The issue has specifically been raised with Microsoft's SkyDrive application for iOS, according to unnamed sources who spoke with The Next Web. The spat reportedly began when Microsoft updated the SkyDrive service to allow users to purchase more storage space, at which point Apple began blocking updates to the iOS application.
Microsoft is said to have a new version of the iOS SkyDrive application completed, complete with bug fixes. But Apple will not approve the software because Microsoft's application does not pay Apple a 30 percent cut of subscription revenue generated from buying additional storage.
"Microsoft does not appear keen to pay Apple the 30% cut, as it lasts in perpetuity, regardless of whether a user continues to use an iOS device or not, as the billing is through their Apple account," author Alex Wilhelm explained.
Update: Microsoft has confirmed that it has seen a "delay in approval" of the updated version of SkyDrive for iOS. The company hopes it will be able to resolve the matter with Apple. The full statement from Microsoft:
"Similar to the experiences of some other companies, we are experiencing a delay in approval of our updated SkyDrive for iOS. We are in contact with Apple regarding the matter and hope to come to a resolution. We will provide additional information as it becomes available."
Microsoft reportedly offered to remove paid subscription options from its SkyDrive application to comply with Apple's rules. But Apple felt that move wasn't enough, as users can still sign up for the SkyDrive service through the application.
And Apple's blocking has allegedly gone further than just Microsoft: The company is also barring third-party applications that interact with SkyDrive because Microsoft isn't paying a 30 percent cut. One such example is the application "Files Pro," which was rejected because it includes a "Sign Up" button for Microsoft's Live login.
The SkyDrive mobile application for iOS launched in the App Store last December. The service competes with Apple's iCloud, offering unique features like collaborative document editing, note sharing, and cross-platform accessibility.
Update 2: AllThingsD is now reporting that inside sources say the issue is connected to Microsoft's upcoming Office 365 for iOS, not just SkyDrive. The argument is said to over subscription fees as Microsoft's Office 365 is a service that allows access to a suite of apps, SkyDrive included. If the publication's sources are correct, Apple is pushing for a 30 percent cut of subscriptions garnered from iOS users.