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Google launches 'One Pass' for publishers as Apple's iOS payments frustrate

post #1 of 181
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Google on Wednesday announced a new Web subscription service for publishers called "One Pass," in which the search giant will keep just 10 percent of revenues in transactions, compared to Apple's 30 percent cut of iOS content.

Google One Pass allows subscribers to access content they've paid for on a variety of devices using a single username and login on a website. It also offers business model flexibility, allowing content providers to offer subscriptions, day passes, metered access, pay-per-article, or multi-issue packages to customers.

"By providing a system for user authentication, payment processing, and administration, Google One Pass lets publishers focus on creating high quality content for their readers," the company said. "Publishers have flexibility over payment models and control over the digital content for which they charge and the content that is free for consumers."

One Pass also allows publishers to grant access to existing subscribers through a coupon-based system. Publishers host their own content, and must add what is referred to as a "small amount of code" to a website. "Development effort is minimal," Google said.

The new service was announced just a day after Apple unveiled its own subscription plan for software on the iOS App Store. Apple takes a 30 percent cut of all sales through the App Store, but publishers can offer access to existing subscribers if they provide their own authentication process inside their iOS application.

According to The Wall Street Journal, Google's One Pass will undercut Apple, and the search company will only keep a 10 percent cut of sales. But Google will also allow publishers control of subscribers' personal data, something Apple has been reluctant to do.



But Apple has also chosen to enforce a rule banning links to external websites that allow customers to purchase content or subscriptions. If a publisher chooses to sell a digital subscription separately outside of an application, the same subscription offer must be made available -- at the same price or less -- to customers who wish to subscribe from within the application.

Apple's changes have frustrated publishers who believe that the iPad maker's 30 percent cut is too high a share for content. The rules for App Store software have even led to speculation that Apple's subscription plans could lead to antitrust scrutiny from the U.S. government.

Makers of software already on the App Store that does not comply with newly enforced in-app subscription rules, such as the Amazon Kindle e-reader, have until June 30 to comply with the rules, or they could be removed from the App Store.
post #2 of 181
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Originally Posted by AppleInsider View Post

But Google will also allow publishers control of subscribers' personal data, something Apple has been reluctant to do. ][/url][/c]

There it is! Google continues to do what's good for them while Apple does what's good for them and their customers.
post #3 of 181
Quote:
Originally Posted by bcahill009 View Post

There it is! Google continues to do what's good for them while Apple does what's good for them and their customers.

Of course, Android is just a loss leader trojan for collecting personal data and delivering ads. Meeting those goals is all that matters to Google.
post #4 of 181
10% sounds really great on Google's part, but what is yet to be determined is will people use the Onepass for purchases? 90% of not much is exactly that. We know Apple can sell media through its purchase model. The question is, will 90% of Google sales be greater than 70% of Apple's?
post #5 of 181
Quote:
Originally Posted by AppleInsider View Post

Makers of software already on the App Store that does not comply with newly enforced in-app subscription rules, such as the Amazon Kindle e-reader, have until June 30 to comply with the rules, or they could be removed from the App Store.

Good bye Kindle, Netflix for iPad.

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post #6 of 181
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Originally Posted by freddych View Post

Good bye Kindle, Netflix for iPad.

You're delusional. The install base available to Netflix is > 100 Million with iOS. They aren't going to lose that base. I could care less about Kindle.
post #7 of 181
Quote:
Originally Posted by mdriftmeyer View Post

You're delusional. The install base available to Netflix is > 100 Million with iOS. They aren't going to lose that base. I could care less about Kindle.

If their margins are less than 30% they will be losing on every iOS subscription, isn't?
post #8 of 181
Quote:
Originally Posted by bcahill009 View Post

There it is! Google continues to do what's good for them while Apple does what's good for them and their customers.

Unfortunately for customers, developers hold the cards. If they don't like Apple's terms, we're the ones that get screwed by not getting access to a lot of great apps. (Darwin will take care of the shitcrap apps.)

That being said, I doubt they'd eschew the Brinks trucks that back into their banks everyday, even with the 30% going to Apple. I'd call their bluff by checking up on the bitching developers that claim they're going to bail on the App Store; I bet they're still there in 90 days.
post #9 of 181
Quote:
Originally Posted by bcahill009 View Post

There it is! Google continues to do what's good for them while Apple does what's good for them and their customers.

There it is, Google wait to see what Apple does first too ..

Plus don't forget Apple's cut is all Apple get, they don't sell / exploit the information as Google does.
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Use duckduckgo.com with Safari, not Google Search
Been using Apples since 1978 and Macs since 1984
Long on AAPL so biased. Strong advocate for separation of technology and politics on AI.
Reply
post #10 of 181
I can see Apple blinking on this one... but I don't see 10%... maybe 20%... just enough of a cut to keep a few more publishers happy.
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post #11 of 181
The irony is stark. First, Google kills off the publishers' traditional business. Now, they are being induced to take their new business to Google.....

All thanks to the magic of ad dollars and monetizing user info, both of which Apple lacks (or refuses to monetize). Wait till Facebook and Twitter get their act together, and start to compete seriously for those same, finite ad dollars and user info. Google's attractiveness will start to sink like a stone.
post #12 of 181
Quote:
Originally Posted by digitalclips View Post

There it is, Google wait to see what Apple does first too ..

Maybe Apple should hold off on occasion to see what Google is going to do. Google can't wait forever so they're going to have to lay down their cards at some point if Apple holds its hand tight.
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post #13 of 181
Quote:
Originally Posted by AppleInsider View Post

According to The Wall Street Journal, Google's One Pass will undercut Apple, and the search company will only keep a 10 percent cut of sales. But Google will also allow publishers control of subscribers' personal data, something Apple has been reluctant to do.

And now we see the REAL nature of the battle Apple is fighting. Google will be joining Apple in cutting out the reseller middlemen. The siren song for content providers is "control of subscribers data". But will they abandon the massive user base that iOS represents to go exclusively to Google? Not likely. The battle will eventually devolve to (1) who will charge less for a given content and (2) which platform gives the customer a better experience.

Competition still exists, pronouncements of doom to the contrary.
post #14 of 181
Quote:
Originally Posted by Gwydion View Post

If their margins are less than 30% they will be losing on every iOS subscription, isn't?

So by ignoring iOS users, Netflix is somehow going to reduce the fixed cost they have to pay for the warehouses, data centers, license and royalty for the contents? Yeah, reduce your subscription base while doing nothing to fixed cost is really going to help your margin. World according to the business illiterate.
post #15 of 181
Quote:
Originally Posted by xsu View Post

So by ignoring iOS users, Netflix is somehow going to reduce the fixed cost they have to pay for the warehouses, data centers, license and royalty for the contents? Yeah, reduce your subscription base while doing nothing to fixed cost is really going to help your margin. World according to the business illiterate.

What? If you didn't understood it I can explain better, or I will try to do
post #16 of 181
Quote:
Originally Posted by Gwydion View Post

If their margins are less than 30% they will be losing on every iOS subscription, isn't?

Your analysis is fallacious. You are assuming that the publishers' marginal and average costs are the same.

Perhaps an Econ 101 course is in order.
post #17 of 181
Quote:
Originally Posted by anantksundaram View Post

Your analysis is fallacious. You are assuming that the publishers' marginal and average costs are the same.

Perhaps an Econ 101 course is in order.

No, I'm asking what happens if Netflix margins are less than 30%, nothing more
post #18 of 181
Quote:
Originally Posted by bcahill009 View Post

There it is! Google continues to do what's good for them while Apple does what's good for them and their customers.

You won't think its such a good thing if you see companies raising prices by a third.

Quote:
Originally Posted by mdriftmeyer View Post

You're delusional. The install base available to Netflix is > 100 Million with iOS. They aren't going to lose that base. I could care less about Kindle.

Doesn't matter what the number is if Apple's taking all the profit. Apple's trying to take the one size fits all software model and apply it to other segments which might have different margins.
post #19 of 181
Quote:
Originally Posted by Gwydion View Post

What? If you didn't understood it I can explain better, or I will try to do

Don't bother. I think you said it well enough above. Clearly 30% is a big commission to swallow. There are clearly positives and negatives to be ironed out here but Apple has drawn the line and we'll see if someone blinks.

A company, whether dealing solely in bits like Netflix's streaming or with legacy media like magazine/newspapers, needs subscribers but handing over 30% may be a non-starter simply if you look at the margins. They can't lose money on each customer and expect to make it up in bulk.

But this clearly changes the whole equation. There are savings from having Apple (and the internet) participate in distribution but the big question is whether you're going to realize enough savings to justify handing over 30%. Any company would prefer less of course but there's a big negotiation going on right now. It's fun to watch from the sidelines as we ALL can watch it as it plays out.
post #20 of 181
Quote:
Originally Posted by ddawson100 View Post

There are savings from having Apple (and the internet) participate in distribution but the big question is whether you're going to realize enough savings to justify handing over 30%. Any company would prefer less of course but there's a big negotiation going on right now. It's fun to watch from the sidelines as we ALL can watch it as it plays out.

In the case of Netflix, Kindle or Nook books, whichs saving can they have having Apple or Google? The distribution, hosting and advertising doesn't change, only chganges the pay processing.
post #21 of 181
It's great that people have an option to compare for themselves and providers can reap the benefits of both if they choose.
The more Google creates these side-by-side comparisons with Apple, the better for Apple I think.
Because it only highlights the ways in which Apple is superior. Because given Google's resources and strategy they should be blowing Apple away in every capacity - and yet with all their copying and one-upping they can only manage to stay competitive with Apple.
post #22 of 181
Quote:
Originally Posted by freddych View Post

Good bye Kindle, Netflix for iPad.


Not at all. They will make the change and probably pretty quick. Kindle is a loss leader product for Amazon. They have thousands of folks with accounts set up that are just as likely to keep going back to the site to buy anything and everything. And the iOS folks will be just as likely to hit the site for non kindle stuff.

Netflix also has a huge base of previous customers. The few that might come via the app will be icing. And it could be totally legit for Netflix o restrict the in app to streaming only plans, so long as the price is the same as on the website. Since not everything is streaming, folks could ditch the in app plan to reup on the site with a plan the also has disks
post #23 of 181
Quote:
Originally Posted by Gwydion View Post

If their margins are less than 30% they will be losing on every iOS subscription, isn't?

No. If Apple takes 30%, their gross margin is 70%. Netflix does a ton of Google and other advertising. My bet is that all that advertising takes almost a big a chunk of revenue as Apple does.

Personally, I think competitive pressure will force Apple to relent somewhat on this issue. I think the compromise will be that Apple still gets 30% of first-year revenue, but they'll get less in subsequent years of continuous subscriptions. This is similar to the current model for magazines, where they actually pay pretty high fees to third parties who sell subscriptions in order to acquire customers. That's why you see these deals where you get a magazine (print) for $10 for the first year, but the renewal price is $30 (although magazine print publishers are so desperate to keep customers, they're offering discounts forever these days.)

As far as the customer information is concerned, I think smart publishers will find other ways to get that information, by offering customers special deals on other items outside of the app, if they supply it. When you subscribe to a print magazine, unless you voluntarily provide other information, what do they really know about you? They only know your address and with that they can estimate your income based upon zip + 4. Everything else is voluntary. Publishers want it because without demographic info, it's hard to sell advertising.
post #24 of 181
Hey, if I can get content like Harpers, the New Yorker, The Atlantic and other mags I subscribe to on Android but not Apple, then bye-bye Apple for my content delivery.
post #25 of 181
you can't make up a loss with volume sales unless your cost structure changes. I don't think the studios give Netflix volume discount on the number of movies they stream. And ISPs like have started making them pay extra to reach their customers so they aren't saving money there either. So, it doesn't matter how many IOS subscribers Netflix misses out on if they lose money on each one. There is a reason they are not in the free service business.

If they stick around on the app store either they can make money giving apple 30% or they find a way to absorb the loss.
post #26 of 181
Quote:
Originally Posted by Gwydion View Post

If their margins are less than 30% they will be losing on every iOS subscription, isn't?

You're making a few unfounded assumptions in your hypothetical. First that their margins are less than 30%, an assumption for which there is no evidence. Secondly that every subscription will be done through iOS, which seems very unlikely. The question is will their margins and subscriptions, through iOS and through other mechanisms allow them to make a profit. I'd say the answer to that is very likely yes, and that being on iOS offers them more value than not being there.
post #27 of 181
The issue facing Google is getting their Android customers to actually buy apps. Their offering may sound good on the surface but if no one is buying then they are just wasting money following Apple around copying their business model.
post #28 of 181
Quote:
Originally Posted by zoetmb View Post

No. If Apple takes 30%, their gross margin is 70%. Netflix does a ton of Google and other advertising. My bet is that all that advertising takes almost a big a chunk of revenue as Apple does.

Being in the App store and on the iOS devices does not eliminate the need for advertising and marketing. In fact, their advertising is the only reason they are relevant right now and we are talking about them. Otherwise, they would be some no name app getting clobbered by Apple that we wouldn't have any interest in.
post #29 of 181
Quote:
Originally Posted by ddawson100 View Post

Don't bother. I think you said it well enough above. Clearly 30% is a big commission to swallow. There are clearly positives and negatives to be ironed out here but Apple has drawn the line and we'll see if someone blinks.

Are you an app developer by chance. I'm thinking not.

When you sign up you agree right then that Apple gets that 30%. if you don't like that don't hit 'agree'. If anything some of these boys may have agreed to give Apple that money and then cheated the company by folks going outside the app. So it is possible that these folks are in breach of contract. If that is the case I would say that Apple is being every generous still allowing outside forms of payment (which they don't have to do) and giving these folks 4 months to make the change rather than only a few days or pulling the apps until it is fixed. Particularly since the in app option rule has been around for a while.
post #30 of 181
Quote:
Originally Posted by charlituna View Post

Not at all. They will make the change and probably pretty quick. Kindle is a loss leader product for Amazon. They have thousands of folks with accounts set up that are just as likely to keep going back to the site to buy anything and everything. And the iOS folks will be just as likely to hit the site for non kindle stuff.

Netflix also has a huge base of previous customers. The few that might come via the app will be icing. And it could be totally legit for Netflix o restrict the in app to streaming only plans, so long as the price is the same as on the website. Since not everything is streaming, folks could ditch the in app plan to reup on the site with a plan the also has disks

You're ignoring the fact that if Kindle and Netflix provide content to their apps available to their previous subscribers, they must allow some option for subscription purchases through the iOS system.

I can't tell what they want to do, but if they don't want to pay 30% commission to Apple for perpetuity on those customers that buy the subscription through the app, they will have to leave the App store.

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post #31 of 181
Again with Google and privacy issues, wait till these publishes etc., start to sell off people's personal information, see who screams then, of course it won't be google's problem they'll just play it off on the app publishers, people never learn.
post #32 of 181
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Originally Posted by DougEEE View Post

The issue facing Google is getting their Android customers to actually buy apps. Their offering may sound good on the surface but if no one is buying then they are just wasting money following Apple around copying their business model.


https://www.mylookout.com/appgenome
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post #33 of 181
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Originally Posted by charlituna View Post

Are you an app developer by chance. I'm thinking not.

When you sign up you agree right then that Apple gets that 30%. if you don't like that don't hit 'agree'. If anything some of these boys may have agreed to give Apple that money and then cheated the company by folks going outside the app. So it is possible that these folks are in breach of contract. If that is the case I would say that Apple is being every generous still allowing outside forms of payment (which they don't have to do) and giving these folks 4 months to make the change rather than only a few days or pulling the apps until it is fixed. Particularly since the in app option rule has been around for a while.

Right, and what we are saying is that we think that in July, Kindle and Netflix will click "Do Not Agree" and the apps will leave the App store.

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post #34 of 181
The assumption that publishers will just hike up the cost of the subscription 30% to offset the Apple tax is wrong. The actual hike would have to be ~43% to bring back the publisher income back to pre Apple tax levels.

Also is this statement stating that a publisher can't provide it's content at a lower price on a different platform (IE Android, it's own website)? If so this will fail miserably in court....

"If a publisher chooses to sell a digital subscription separately outside of an application, the same subscription offer must be made available -- at the same price or less -- to customers who wish to subscribe from within the application."
post #35 of 181
Apple will lose this battle and quickly. And it might even be the war. I'm thinking of Amazon in particular. For me, Kindle is the key app and if Amazon pulls Kindle from the app store the iPad becomes a doorstop.

Apples Bookstore is a joke, and Apple doesn't have the clout to get the same of books on to their site that Amazon has.

There is no way Apple can now save face either. It will be seen as an emperor with no clothes.
post #36 of 181
Quote:
Originally Posted by anonymouse View Post

You're making a few unfounded assumptions in your hypothetical. First that their margins are less than 30%, an assumption for which there is no evidence. Secondly that every subscription will be done through iOS, which seems very unlikely. The question is will their margins and subscriptions, through iOS and through other mechanisms allow them to make a profit. I'd say the answer to that is very likely yes, and that being on iOS offers them more value than not being there.

No, I'm not ssuming nothing, someone said that the installed iOS base is so high that they won't leave and I have asked why can't they leave if the cut Apple will make is greater than their margins.
post #37 of 181
The cost of producing at extra copy of a digital magazine is basically zero. Thus profitability for a publisher is determined entirely by revenues (okay once you clear fixed costs).

As long as having an iOS App delivers at least 30% more unit sales than not having an iOS app, then the publisher makes more money by going through the App Store.

So it's a simple question. Can the App Store deliver at least 30% more unit sales then a publisher's other digital channels? I would say yes. Way more than 30% even.

Of course the publishers are profit maximizers as well and they'd want to keep as much of that 30% cut as they can. There are really no moral or legal issues at play here. It's just a commercial dispute over how profits are split between Apple and the publishers. Whoever has the stronger bargaining position wins of course.
post #38 of 181
So, shouldn't Netflix, Amazon, and Hulu let their apps lapse past June 30th and see how it shakes out? I mean, they could do a "download and install" drive to get everyone to get the app, and then they could let their app get pulled from the store.

Apple would have to explain to new iOS users why they can't have the legacy apps that existing customers have.

Meanwhile, Amazon, Netflix and Hulu are on all of the installed base prior to June 30th with the existing business model for which they signed up.


But does this really affect Amazon? They don't have subscriptions (or I guess they do) but when you're talking about books, isn't this rule only about subscriptions and not the sales of books?
post #39 of 181
Quote:
Originally Posted by InLightOf View Post

The assumption that publishers will just hike up the cost of the subscription 30% to offset the Apple tax is wrong. The actual hike would have to be ~43% to bring back the publisher income back to pre Apple tax levels.

Also is this statement stating that a publisher can't provide it's content at a lower price on a different platform (IE Android, it's own website)? If so this will fail miserably in court....

"If a publisher chooses to sell a digital subscription separately outside of an application, the same subscription offer must be made available -- at the same price or less -- to customers who wish to subscribe from within the application."

not sure how they do it with books or streaming movies (unless formated for a different size screen) but I would image that they could just create a separate product called "iPad Edition" that they sell only in the app store and charge whatever they want and not have to alter the pricing of their other editions .
post #40 of 181
Quote:
Originally Posted by tlevier View Post

But does this really affect Amazon? They don't have subscriptions (or I guess they do) but when you're talking about books, isn't this rule only about subscriptions and not the sales of books?

The rules affects subscriptions and one time purchases of video, music, books, publica<tions, etc
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