Apple unveils subscriptions for iOS App Store, bans links to out-of-app purchases

1212224262729

Comments

  • Reply 461 of 561
    Quote:
    Originally Posted by hatunike View Post


    How about you walk into a wal-mart and try to open a minishop aisle and not pay anything to wal-mart. GADZOOKS! Why has NOONE thought of this!?!?! Think about it, its a great location, people are there to shop! You bought something there, you can just open your own shop up there too. Heck, maybe you even sold some stuff through wal-mart before. Maybe you are the owner of a company that sells through Wal-mart. Of course without people like you wal-mart would NEVER have sold a single item....so of course, it's your right to walk into wal-mart and use wal-mart to open up your own store with your own rules....hmm forget wal-mart....what did they ever do anyways?



    No, but I can buy a "Auto Trader" magazine off the magazine rack in Walmart and buy a car from it and Walmart does not get a cut. Walmart sells iPhones and iPods. Does apple give them a 30% cut of all the music and apps sold on those devices after they are purchased? After all If Walmart didn't have it on the shelf to be sold those subsequent purchases would not have happened.
     0Likes 0Dislikes 0Informatives
  • Reply 462 of 561
    Hypothetical Situation:



    I create a free iOS App to read e-magazines sold on my website.



    3 questions:



    QUESTION 1:

    Can I replace my "Buy on website" button with a big message, saying "Buy magazines from our website URL"?



    QUESTION 2:

    We decide to fall into line and introduce IAPs. If the economics of the sale of an issue of a magazine were this:



    Bought-on-website issue sells for $10.

    Costs are $2.

    We give 75% of margin to the author and publisher = $6.

    We keep 25% of margin = $2.



    Under the new rules, if we added IAP and absorbed the IAP fees equally between us, this would result in:



    IAP issue sells for $10.

    Costs are $2.

    We give $3 to Apple.

    We give 75% of margin to the author and publisher = $3.75.

    We keep 25% of margin = $1.25.



    Does this announcement mean we just have to accept lower profits?



    BUT



    If we also wanted to sell the same magazine on our website slightly cheaper like this, spending more on marketing to support that effort:



    Bought-on-website issue sells for $9.

    Costs rise 50% to $3 (to accommodate additional web marketing).

    We give 75% of margin to the author and publisher = $4.50.

    We keep 25% of margin = $1.50.



    Both we and the publishers make more money - even if the additional web costs rise 50%.



    QUESTION 3:



    Would Apple insist we must charge $10 for it to match the IAP price?

    If so, how is it in the customers' interests to force a price rise?



    Or do people think we would be allowed to charge $10 IAP and $9 on the website under these rules for non-subscription content?



    Not taking sides, just asking.....
     0Likes 0Dislikes 0Informatives
  • Reply 463 of 561
    The revenue split is a great deal for publisher. They get to keep more money than publishing through other channels. And the iPad delivers a large number of active consumers.



    It's good for consumer too. The one-click in-app purchasing is more convenient and they don't have to face the prospect of their personal details being re-sold.



    This is a not a great deal for middle-men. Those companies who take content from publishers, and then want to re-publish it are going to find themselves squeezed.



    If a publisher wants their content on an iPad, why would they want to share revenue with a middle man? They can do better publishing it directly.



    It's possible the move could alienate some vendors. But it's going to attract more content.



    C.
     0Likes 0Dislikes 0Informatives
  • Reply 464 of 561
    kotatsukotatsu Posts: 1,010member
    Quote:
    Originally Posted by Swift View Post


    You win! You are a troll!



    Nope, he's just telling the truth.



    Apple are a millions miles away from being reasonable here, and when Amazon and every other premium content supplier ditches iOS for Android, you can be Apple will, long after everyone else, realise how terribly wrong they were.
     0Likes 0Dislikes 0Informatives
  • Reply 465 of 561
    melgrossmelgross Posts: 33,713member
    Quote:
    Originally Posted by kotatsu View Post


    Nope, he's just telling the truth.



    Apple are a millions miles away from being reasonable here, and when Amazon and every other premium content supplier ditches iOS for Android, you can be Apple will, long after everyone else, realise how terribly wrong they were.



    No, he is trolling. When you start out by stating that if people don't agree with you, they're fanboys, that's trolling. If he just laid out his case, it would be different. Another statement like that, and if I'm here, he's off.
     0Likes 0Dislikes 0Informatives
  • Reply 466 of 561
    asdasdasdasd Posts: 5,686member
    Quote:
    Originally Posted by joindup View Post


    Hypothetical Situation:



    I create a free iOS App to read e-magazines sold on my website.



    3 questions:



    QUESTION 1:

    Can I replace my "Buy on website" button with a big message, saying "Buy magazines from our website URL"?




    Uknown. And that is part of the problem of these loose Apple rulings.



    Quote:

    QUESTION 2:

    We decide to fall into line and introduce IAPs. If the economics of the sale of an issue of a magazine were this:



    Bought-on-website issue sells for $10.

    Costs are $2.

    We give 75% of margin to the author and publisher = $6.

    We keep 25% of margin = $2.



    Under the new rules, if we added IAP and absorbed the IAP fees equally between us, this would result in:



    IAP issue sells for $10.

    Costs are $2.

    We give $3 to Apple.

    We give 75% of margin to the author and publisher = $3.75.

    We keep 25% of margin = $1.25.



    If you can give the reduced margin to the customer. If not - and this is the case with Amazon where prices are agreed - your costs would be $2 + $3 + $6. You cant really hand reduced margin to your customer for certain platforms. In that case your profits are $-1.





    Quote:

    If we also wanted to sell the same magazine on our website slightly cheaper like this, spending more on marketing to support that effort:



    Bought-on-website issue sells for $9.

    Costs rise 50% to $3 (to accommodate additional web marketing).

    We give 75% of margin to the author and publisher = $4.50.

    We keep 25% of margin = $1.50.



    Both we and the publishers make more money - even if the additional web costs rise 50%.



    QUESTION 3:



    Would Apple insist we must charge $10 for it to match the IAP price?

    If so, how is it in the customers' interests to force a price rise?

    .



    Yes, Apple would insist that the price be the same on the IAP and the website. How they enforce this is up for debate.
     0Likes 0Dislikes 0Informatives
  • Reply 467 of 561
    asdasdasdasd Posts: 5,686member
    Quote:
    Originally Posted by tipt View Post


    If you are so confident in your opinion why tell people they can't respond? I really don't think you have any basis to label someone else. Everyone has their opinions. You make statements without much basis.



    He actually laid out three criteria of how resellers would have to handle this issue. There has been a lot of shouting about trolls since, but nobody has really argued coherently against his position.
     0Likes 0Dislikes 0Informatives
  • Reply 468 of 561
    asdasdasdasd Posts: 5,686member
    Quote:
    Originally Posted by Carniphage View Post


    The revenue split is a great deal for publisher. They get to keep more money than publishing through other channels. And the iPad delivers a large number of active consumers.



    It's good for consumer too. The one-click in-app purchasing is more convenient and they don't have to face the prospect of their personal details being re-sold.



    This is a not a great deal for middle-men. Those companies who take content from publishers, and then want to re-publish it are going to find themselves squeezed.



    If a publisher wants their content on an iPad, why would they want to share revenue with a middle man? They can do better publishing it directly.



    It's possible the move could alienate some vendors. But it's going to attract more content.



    C.



    It will only attract more content if iBooks get the publishers, not Kindle. It has become clear to me that this is about kicking the Kindle off the iPad. However Amazon will definitely have more leverage with publishers, and so this war has only begun.



    Apple will probably lose. If Amazon blacklist any publisher also on iBooks - a restraint of trade no less, or more severe than what Apple is doing here - then iBooks is doomed.



    This is a high stakes poker game. If APple wins, they lose in anti- trust.
     0Likes 0Dislikes 0Informatives
  • Reply 469 of 561
    asdasdasdasd Posts: 5,686member
    Quote:
    Originally Posted by Carniphage View Post


    The revenue split is a great deal for publisher. They get to keep more money than publishing through other channels. And the iPad delivers a large number of active consumers.



    It's good for consumer too. The one-click in-app purchasing is more convenient and they don't have to face the prospect of their personal details being re-sold.



    This is a not a great deal for middle-men. Those companies who take content from publishers, and then want to re-publish it are going to find themselves squeezed.



    If a publisher wants their content on an iPad, why would they want to share revenue with a middle man? They can do better publishing it directly.



    It's possible the move could alienate some vendors. But it's going to attract more content.



    C.



    It is good for one Middle Man. However you are correct on Publishers - if they all flock to iBooks then Apple wins ( as the middle man who doesnt soak up the 30% charge on revenue) and publishers dont lose.
     0Likes 0Dislikes 0Informatives
  • Reply 470 of 561
    hirohiro Posts: 2,663member
    Quote:
    Originally Posted by cmf2 View Post


    If you want to use real world analogies, the app store is more like at shopping mall than a store.



    But we aren't discussing the "App Store" in general, we are discussing in-app purchases within an app sold in the App Store. So we did leave the greater mall and entered a single store, in my analogy a grocery store -- maybe a Target Greatland if that makes you feel better since they are attached to malls all over.



    Try to be careful and not miss the actual content of the thread.
     0Likes 0Dislikes 0Informatives
  • Reply 471 of 561
    cmf2cmf2 Posts: 1,427member
    Quote:
    Originally Posted by Carniphage View Post


    The revenue split is a great deal for publisher. They get to keep more money than publishing through other channels. And the iPad delivers a large number of active consumers.



    It's good for consumer too. The one-click in-app purchasing is more convenient and they don't have to face the prospect of their personal details being re-sold.



    This is a not a great deal for middle-men. Those companies who take content from publishers, and then want to re-publish it are going to find themselves squeezed.



    If a publisher wants their content on an iPad, why would they want to share revenue with a middle man? They can do better publishing it directly.



    It's possible the move could alienate some vendors. But it's going to attract more content.



    C.



    If it's such a good deal, it doesn't have to be forced on everyone. People will willingly exercise the option to use it.



    The middle men being squeezed are the same ones that have done the most for online streaming video. I want to see online streaming video succeed, and it doesn't only affect middle men. It affects any cross-platform service. If a network wanted to start streaming their channel live online for a monthly fee, and offered an app to stream to the iPhone, Apple would require them to add an in app subscription button where they'd take 30% of the subscription fee.



    It's quite convenient for Apple that the companies hit hardest with this happen to be in competition with Apple's Music, Video and Print sales. If Apple has sufficient influence over the market (this is different from market share) I still think there could be some valid anti trust claims in there.



    There is a way out though. It's HTML5 (I guess it's just HTML now) and DRM free sales. Online video can be served through HTML5 sites and eBooks and other media sold DRM free could be read by any app that could read the file type and apps not associated with the online store couldn't feature in-app purchasing. I guess standardized DRM, like what Adobe is trying to do for eBooks could also work but DRM free would be better. If Apple does drive companies to do this, I'll be happy with the end result, but I doubt that is Apples intention.
     0Likes 0Dislikes 0Informatives
  • Reply 472 of 561
    hirohiro Posts: 2,663member
    Quote:
    Originally Posted by tipt View Post


    I'm not sure people fully grasp what a monopoly is or anti-trust.



    Don't be not-sure. be very sure that an incredible number of posters have no clue about the terms they use on this board. They just spout self-serving pseudo-logic built on personal definitions of terms, not reasoned use of carefully, precisely, legally defined terminology.
     0Likes 0Dislikes 0Informatives
  • Reply 473 of 561
    hirohiro Posts: 2,663member
    Quote:
    Originally Posted by melgross View Post


    Why don't you tell us then? Explain how Apple is a monopoly, if that's what you're trying to do. I'd be very interested in what you say.



    Mel, I think he's saying the opposite, the Apple is a monopoly folks are out to lunch.
     0Likes 0Dislikes 0Informatives
  • Reply 474 of 561
    hirohiro Posts: 2,663member
    Quote:
    Originally Posted by nikon133 View Post


    I would say it is not impossible that Apple actually wants that - force them out and move users to iBooks. I think that would be very much in line with other moves Apple did in the past (like preventing Apple devices to work with anything else but iTunes).



    This is bandied about in several places, yet I fail to see any way that this alarming possibility is the least bit likely. Easy to state hard to justify.



    Your statement about preventing other devices from working with iTunes is blatantly false. Many devices over the years have worked with iTunes, leveraging off the iTunes XML metadata and processing that in a third party application. What Apple didn't allow was Palm faking a Pre-as-an-iPod over the USB bus so Palm wouldn't have to write any of their own iTunes sync software. A move the USB consortium threatened Palm with expulsion over if they did not cease the illicit ID faking because it broke consortium contracts.
     0Likes 0Dislikes 0Informatives
  • Reply 475 of 561
    hirohiro Posts: 2,663member
    Quote:
    Originally Posted by nikon133 View Post


    What visibility Apple is providing? Are they advertising Amazon, Sony... books on iTunes? They are hardly advertising readers apps - all I have downloaded, I have read about somewhere else.



    Yes, they are. Via the appearance of those entities in the App Store. How narrow minded you are to not see that.
     0Likes 0Dislikes 0Informatives
  • Reply 476 of 561
    hirohiro Posts: 2,663member
    Quote:
    Originally Posted by macarena View Post


    There are 2 models of subscription content we are dealing with here. On one side, we have the Amazon Kindle, where Apple only hosts the Kindle App - and the books themselves are just PDF files hosted by Amazon. I think Apple's new quidelines are a stretch when it comes to the Kindle books - because really, all Apple is doing is providing a platform for the Kindle App.



    On the other side, there are *apps* like "The Daily". In this case, the content is an App - designed to have special effects, and user interaction beyond what regular HTML5 can offer. In this case, Apple actually has to host the content as well, because the content is published in the form of an App. Content owners cannot provide this functionality from a HTML5 website - because the user experience would be impacted badly.



    I think Apple (and for that matter, us) need to distinguish between these two models. I think it is entirely appropriate to get a 30% cut on subscriptions to "The Daily", especially because it comes with a lot of convenience features - the App will be updated automatically for you as you wake up, etc. Also, Apple has to pay credit card charges, bandwidth charges, storage charges, etc.



    The question we should be asking is - are these guidelines even applicable to the Kindle App. Remember, the Kindle App is the only one where this model falls apart totally. After Apple's cut of 30%, Amazon will not be left with anything! I think what Apple is doing, is that rather than create a special category for the Kindle App, they can negotiate directly with Amazon for different terms just for this app. Maybe 10% or so. We will know soon, based on whether the Kindle App stays in the store, or is pulled. Quite obviously, the existing policy does not make any sense for Amazon to continue selling in the store.



    One possible option for Amazon - They can eliminate the link to Safari, and not provide any in-app purchasing capability. They can simply treat iPad subscribers as "Existing Subscribers" for whom the content is free anyway. This is a model allowed by Apple, even under the new guidelines. The only problem is that customers will be forced to buy the App separately, and then use it from the Kindle app. In such a case, the Kindle app will become a simple "Bookshelf" to display the books you own - and not a store.



    While I agree with a significant chunk of your post, the "After Apple's cut of 30%, Amazon will not be left with anything!" is bogus and based on overly naive arithmetic.



    Amazon's pass thru to the supplier is 70%. If Apple gets 30% of the retail cost, Amazon's wholesale cut is 70% of which the pass-thru is 70% of that (~49% overall which is pretty close to the retail norm). If Amazon has any contracts that preclude that those items would rightfully be excluded from iOS in-app purchases by Amazon just not displaying them at all in-App. There is no scenario where Amazon will be forced to sell something and never get anything for the trouble. That's just a sloppily constructed, quite broken, bad example.
     0Likes 0Dislikes 0Informatives
  • Reply 477 of 561
    hirohiro Posts: 2,663member
    Quote:
    Originally Posted by nikon133 View Post


    http://online.wsj.com/article/SB1000...997208194.html



    You are apparently not the only one thinking that way... Wall Street Journal is also thinking about possible antitrust issues.



    Yeah, but you conveniently miss the mention of the quoted professor that outlined several ways that this likely isn't an anti-trust problem.



    The accurate way to summarize the article is -- WSJ examined the anti-trust issues and the expert professor outlined both sides of the issue with compelling reasons why it probably isn't an actual anti-trust problem.
     0Likes 0Dislikes 0Informatives
  • Reply 478 of 561
    hirohiro Posts: 2,663member
    Quote:
    Originally Posted by Voight-Kampff View Post


    I know there's no way for this to not sound... "Trollish," but if you defend Apple on this, then you are biased. You are an Apple fanboy.



    You're right you are a outright troll. Any idiot which cones into a conversation and says ~ If you don't agree with me you are a ____________~ is a worthless troll.



    The rest of your post is poorly crafted bashing that ignores the totality of business reality. I won't even dignify it with quoting it.
     0Likes 0Dislikes 0Informatives
  • Reply 479 of 561
    hirohiro Posts: 2,663member
    Quote:
    Originally Posted by nikon133 View Post


    Well, if they can make $75M selling same stuff outside of iTunes (which is still more than what they are left with, after Apple cuts their share)... why would they stay?



    For me, question is not if Apple can try to pull that sort of move... it is more like, can that move be good for Apple and their users, in the long run?



    Because maybe they sell $90Million with an App too.
     0Likes 0Dislikes 0Informatives
  • Reply 480 of 561
    hirohiro Posts: 2,663member
    Quote:
    Originally Posted by Carniphage View Post


    Doesn't the Amazon book store have an unfair advantage on the Kindle reader?



    C.



    Shhh! Don't rock the trolls with their own logic!
     0Likes 0Dislikes 0Informatives
Sign In or Register to comment.