What's wrong with devs/publishers upcharging an app/subscription by 30% in the App Store, but offering a coupon code on their own individual websites that discounts the purchase price (but only through them?) Then technically they would be offering the same good at the same price in the App Store, but not be taking a hit.
It doesn't have to work exactly this way, but do you see my point? And if consumers found out about this (which they certainly would), the devs/publishers wouldn't even have to have a hyperlink in their own app-- we'd find it ourselves.
Just a thought.
I sincerely hope these services do leave or use the loophole pointed out above: price it all the same across the various distribution networks (Android Market, App Store, web store), and then offer customers a perpetual 43% discount (it's 30% of gross Apple is demanding, not net...that's actually a 43% price increase to compensate) if you buy the service anywhere but the App Store.
Barring that, I hope these services leave. Nothing will improve competition more than Apple shooting itself in the foot and compelling all these services to go to competing platforms. If they are really arrogant enough to think that their plaform will survive without any of these services, I am all for putting it to the test. After all, loyal Apple users insist that a controlled choice is good. So let's see how well iOS does when all content in the ecosystem is only distributed by Apple. It's the ultimate end-state of Apple's curation efforts.
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Originally Posted by jkichline
I'm a developer who's making both iOS and Android apps. It's not the developer who makes the decisions. It's the end-user. As long as Apple holds the mind share of the public, they are going to have a lot of users. If Amazon, Instapaper and the like leave, they are shooting themselves in the foot. I think they understand this. It's going to take at least a year for the MS/Nokia deal to produce anything and by then Apple will be further ahead.
I really can't see how Netflix or Skype or Time or Rhapsody can abide by this condition. Apple is now dictating their prices across all their distribution networks and insisting that the App Store be the cheapest while taking its 30% cut. That'd be disastrous for a business like Netflix which charges $8 a month. Either they drop iOS or they have to raise prices for everybody. So now Apple gets to tax Android and web users? Even worse, the policy basically bumps off any competing media distributor (Amazon, B&N, etc.), which given Apple's proclivities towards issues like censorship (er?"curation") should be deeply disturbing to anybody.
I find it disturbing that Apple fans actually support this. Would anybody here have said the same thing if Microsoft had said that you were only allowed to buy software (approved by them of course) for your PC from a Microsoft store and then turned around and insisted that not only should they get a 30% cut of intial app sales but also a 30% cut of every subscription sold and every transaction made from the app? Oh?and you've got to price the subscription the same, inside and outside the software. If Microsoft had done this, people would be screaming, "bloody murder." But people defend this move because, "Apple made the ecosystem." Gimme a break.
Should Apple get compensated for their efforts in maintaining the store? Sure. And if the $99 per year that they charge for the app is not enough, then I'm sure they can negotiate higher rates. A 30% cut of every transaction and every subscription, however, borders on extortion. Hell, that's more than double the sales tax in most countries.
Developers forget to mention that although they pay a hefty 30%, they have no advertising costs, no distribution costs and their app can potentially be purchased worldwide. That's also worth a lot of money...
Who says you have no advertising costs? Apple does very little promotion for you unless you are a real cool app or rack up some impressive download / purchase numbers and make one of the top 10/25/50 lists. The real successful apps have had to do their own marketing and promotions just like any other software product. Read up on Angry Birds on how they blasted the internet to get more sales. Big names like Amazon, Hulu and Netflix can ride on the million of customers they already have and the millions they are spending in marketing to get their app downloaded.
Who says you have no advertising costs? Apple does very little promotion for you unless you are a real cool app or rack up some impressive download / purchase numbers and make one of the top 10/25/50 lists. The real successful apps have had to do their own marketing and promotions just like any other software product. Read up on Angry Birds on how they blasted the internet to get more sales. Big names like Amazon, Hulu and Netflix can ride on the million of customers they already have and the millions they are spending in marketing to get their app downloaded.
Rentals are not affected and publishers who direct customers to the iTunes store get 100% of their price.
These outcries reflect how big Apple is, for good and for bad. And I think it's a bit overblown much like Antennagate.
For example people talking about Amazon or Netflix pulling the app. Why should they? All they need to do is delete any link to outside store or subscription service, then nothing will change. No price change. No need to pull off.
Amazon can delete in-app links to their store. Make it purely a reader app. Have people go to Safari to purchase book. Once it's purchased it'll be on your account. Go back to the app, sign in and read. Apple get nothing.
Netflix? Just don't put any subscription service in the app. Have people subscribe on website then if you want to watch it on your iPad, pick it up, sign in and watch. Apple also get nothing.
If you want the convenience of Apple system then pay. If you don't want to pay, don't use it.
Do I understand something wrong?
Yeah. You're not allowed to link away. So in your scenario, you can't even link people to the web store. You just have to tell people to go to the store (can't direct them there). These apps will have to be pure content consumption tools....setting them at a distinct disadvantage to whatever competing service Apple offers itself. I don't even know why Amazon or Netflix would even bother. I think it's far better to pull out completely at this point and make a statement. For a company like Skype, they'd have to actually reduce features in their app. No more buying credits through the app. Skype and its customers suffer. Apple comes out ahead. Actually, I'm not even sure if Skype is allowed to even operate in iOS if they still sell credits elsewhere.....maybe they'll pull out too.
Fact is that some of these "too big to ignore" companies are freeloading on THE ONLY WORKING MOBILE platform on the planet.
You mean like Apple is freeloading off of Windows, the DOMINANT desktop OS on the planet?
If the iPod had stayed exclusive to Macs what are the chances we'd even be discussing Apple right now except in the past tense? How quickly would Apple start to tank if Microsoft could find some legal way to prevent Apple devices from working on the Windows platform?
The conceit that companies are leeches, parasites or freeloaders is just ridiculous. Apple benefits from having Netflix, Hulu, Kindle, etc. on the iOS platform. And in return, those companies benefit from being on the iOS platform. It's a symbiotic relationship. It's the apps that make iOS more attractive than other smartphone platforms. How many times has someone rattled off the 300K iOS apps vs the 135K Android apps (or whatever the exact numbers are now) as a reason for iOS's success?
As someone else said, I wonder if part of this is to get competing services off of the iOS platform. As has been repeated already, there's no way Kindle can support staying on iOS with Apple now set to take 100% of Amazon's cut of the sale price of every book. The same for all other e-reader book stores. Which leaves the iBookstore the only game in town, only now with a stronger position to negotiate with the content providers (after all, if they want to be on iOS they're only option will be Apple). With Netflix, Hulu, Rhapsdody and other audio/video content providers gone, options narrow back to the iTunes Store. If Apple is prepping a subscription music service, now would be a good time to get the competition off of iOS and then announce the new iTunes subscription service.
I wonder how so suddenly apple got a 100% market share in book publishing inside iOS...
You mean the way the Kindle and Nook currently have a 100% market share inside their platforms?
Newsflash: This is not about iOS! This is about the app store! They are two different things. I'm tired of people making comments like, "What if Microsoft charged for every application you loaded onto Windows?" Microsoft never had an app store, but if they had -- a source for applications that they built where users could purchase software with a single, easy to use interface -- then they would be perfectly within their right to charge a fee for it.
The app store is not the web! It's a curated storefront created and maintained by Apple, where they are allowing competitors access to Apple's customers. How many GM cars do you see being sold at Lexus dealerships?
... Should Apple get compensated for their efforts in maintaining the store? Sure. And if the $99 per year that they charge for the app is not enough, then I'm sure they can negotiate higher rates. A 30% cut of every transaction and every subscription, however, borders on extortion. Hell, that's more than double the sales tax in most countries.
And $99/year is more than double the cost of a meal at McDonald's, and has about as much to do with the fee to join the developer program as sales tax has to do with the 70/30 revenue split.
A 30% cut is, in reality, much less than developers "distribution costs" have traditionally been. For publishers of periodical content, despite some grumbling, this will end up working out just fine for them since most of their revenue comes from advertising anyway, and Apple gets 0% of that revenue. For "developers" like Amazon and Netflix, the whole thing is overblown. Since 100% of their sales will never come through in-app purchasing, and Apple is simply requiring that as an option, they won't be paying 30% of their total related revenue to Apple. Frankly, I'd be surprised if what they end up paying is even 5% of their total related revenue, probably much less.
Highly unlikely. Their sales would be hurt significantly by a subscription model. It's easy to get someone to pay $.99 for a app but $.99 a month would be a deal breaker for most so any retooling would just be them shooting themselves in the foot.
If I have an app priced at $0.99 on straight sell, I would price it as $0.1/month for 12 months. Seems it might be even easier to hook someone, and I got more out of it. Plus I would have paid Apple less, if their subscription model is lower priced.
Of course, I would have to actually offer some content through the app to quality. But there's always something one could think up.
So a non-uniform pricing model is certainly open to gaming. The only way to avoid that would be to make non-uniform deal only available through individual negotiated deal with the app publisher. But that opens another can of worm in itself.
I don't think so; Apple may desire affordably low prices, but Google's eventual aim is NO price at all, as their market strategy is focussed on commoditisation which allows them to push their advertising cash cow to everyone everywhere, which will be to the detriment of said publishers and developers and much to Google's prosperity.
That would be the last resort of the desperate.
That's BS. I know there's this myth with Apple Fans that Android geeks don't pay for content. But it's not true. The only reason that paid content on Android Market isn't doing well is because Google has cocked up payment methods and has not made paid apps accessible in every country yet. When that changes (and that seems to be Google's big push right now), paid apps will take off in Android land too.
Now if that was the hidden motive instead of an "evil" money grab... That would be cool
+1
If getting everybody to go to the web with HTML5 is Apple's goal, I will wholeheartedly back them. Somehow though, I seriously doubt that's their end game here.
And $99/year is more than double the cost of a meal at McDonald's, and has about as much to do with the fee to join the developer program as sales tax has to do with the 70/30 revenue split.
I only bring up the $99 because people keep spouting off about apps being free. That's BS. They are most certainly not free. And I would never suggest that they should be. Ditto for the 70/30 split for app sales.
Now as to this subscription business.
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Originally Posted by anonymouse
A 30% cut is, in reality, much less than developers "distribution costs" have traditionally been. For publishers of periodical content, despite some grumbling, this will end up working out just fine for them since most of their revenue comes from advertising anyway, and Apple gets 0% of that revenue.
Agree?up to a point. I have an issue with Apple dictating the pricing outside of their little universe. But hey, these developers are grownup business people, they can decide if it makes sense for them to play with Apple.
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Originally Posted by anonymouse
For "developers" like Amazon and Netflix, the whole thing is overblown. Since 100% of their sales will never come through in-app purchasing, and Apple is simply requiring that as an option, they won't be paying 30% of their total related revenue to Apple. Frankly, I'd be surprised if what they end up paying is even 5% of their total related revenue, probably much less.
Except, that Apple now dictates that you must offer a subscription model through the app and you must price it the same as elsewhere and you must pay Apple a 30% cut. In essence, Apple is hoping to redirect business from their other distribution networks to the App store and get a 30% from it. That's going to be a lot more than 5%.
Beyond that, I see this as purely anti-competitive. This is a dick move by Apple to basically eliminate competition before they get to go to the studios and networks and content creators and say to them, "There's only way to sell your content to our 160 million+ client base. That's through us." No more Netflix Watch Instantly or Hulu Plus or Kindle. From now on, all content runs through an Apple branded service (iTMS, iBookStore, etc.). If that's not abusing a dominant position in one field to create an unfair advantage in another, I don't know what is. Microsoft got its peepee slapped for a lot less than what Apple is attempting here.
This whole brouhaha is fascinating to watch, and as expected, playing out much like the iTMS situation. The music business was livid that Apple imposed a 30% split with music publishers and they threw a fit that Apple shouldn't be able to dictate the cost at $.99 a track. But Apple took a stand and created a billion dollar business, tweaking the formula after building the foundation. That didn't stop the music business from demonizing Apple, threatening to remove their catalogs, giving sweetheart deals to competitors, etc. But the checks from iTMS dwarfed every other distributor combined, so the music industry has had to tone down their objections and rhetoric. It turns out Apple knew what they were doing better than everyone including Microsoft, Wal-Mart, Amazon, et al.
I find striking similarities to this subscription policy and if I were betting on anyone, I'd put money on Apple. It's not to say that they're right or wrong, but they're drawing upon their past experiences (including a lot of hostility with these same publishers). But regardless of all the apoplectic responses on this forum, Apple has a goal in mind and will drag the publishing industry along. It may be traumatic and painful, but publishers who sign on will likely see a new source of revenue that may offset and even reverse their declines over the past few years. And if Apple's wrong, they will adjust their policies to help improve the ecosystem for both their customers and publishers.
The publishing industry is a complex beast, with fiefdoms that have been established long ago. They aren't used to having a powerful outsider like Apple come in and dictate their world to them. But money talks, and that's the key to how this plays out.
Does Netflix count as a rental or a subscription service? After all, it's a flat rate for x amount of movies. Sounds like a subscription to me.
It doesn't matter. You can't use the new API to rent content directly through the iTunes store.
And as Apple has posted in their press release, "?publishers can sell digital subscriptions on their web sites, or can choose to provide free access to existing subscribers. Since Apple is not involved in these transactions, there is no revenue sharing or exchange of customer information with Apple,"
I would suggest that it covers the likes of Netflix.
I'm tired of people making comments like, "What if Microsoft charged for every application you loaded onto Windows?" Microsoft never had an app store, but if they had -- a source for applications that they built where users could purchase software with a single, easy to use interface -- then they would be perfectly within their right to charge a fee for it.
So you'd be okay with MS insisting that all software be purchased through a Windows Store and that MS take a 30% cut off every transaction in the Windows universe.
Wow.
MS must have the dumbest executives on the planet. Imagine the billions they could have made taxing iTMS sales at 30% alone.
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Originally Posted by David Forbes
The app store is not the web! It's a curated storefront created and maintained by Apple, where they are allowing competitors access to Apple's customers. How many GM cars do you see being sold at Lexus dealerships?
Actually, they do sell used cars from competitors...but that aside....when your store is rather dominant, anti-trust issues do come into play. Especially when you try to knock off the competition. You may approve of such practices. Most consumers do not. We don't like being left with one choice. I sincerely hope this gets the attention of anti-trust authorities worldwide.
That's BS. I know there's this myth with Apple Fans that Android geeks don't pay for content. But it's not true. The only reason that paid content on Android Market isn't doing well is because Google has cocked up payment methods and has not made paid apps accessible in every country yet. When that changes (and that seems to be Google's big push right now), paid apps will take off in Android land too.
Like I said above in a post: The only working mobile platform on the planet.
How many times does that have to be said? There is NO competing platform except for Apple's... yet!
If the landscape changes, maybe Apple will reconsider.
However, as someone mentioned, maybe it is because Apple is trying to force their own offerings in the future. That data center is sitting just waiting for something to fill it and stream out of.
It comes down to the fact that every single store of any kind, has been "cocked-up" as you say. If... if... if.... yeah... I personally would LOVE to see someone besides Apple come out and actually do something about this.
Same as the hardware story: where are all those great iPad-killers? How many people use them? What's the market situation look like to get me as a consultant to advice my clients that they better get developing quick for the Android market... which BTW, is still "cocked-up" as we speak... as is their platform truth be told.
Which is why there should be anti-trust implications.....
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Originally Posted by ThePixelDoc
If the landscape changes, maybe Apple will reconsider.
And if the landscape changes (and I hope it does), this problem will sort itself out pretty quickly. There is no way Apple would have even contemplated something like this if the market was truly competitive.
So hopefully, if anti-trust threats don't work, I hope the competitive threat can keep Apple in place.
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Originally Posted by ThePixelDoc
However, as someone mentioned, maybe it is because Apple is trying to force their own offerings in the future.
I think so too. Once they kick Netflix and Hulu Plus off, they'll have lots of negotiating power with Hollywood....something they can't have as long as there are competing services.
So you'd be okay with MS insisting that all software be purchased through a Windows Store and that MS take a 30% cut off every transaction in the Windows universe.
Wow.
MS must have the dumbest executives on the planet. Imagine the billions they could have made taxing iTMS sales at 30% alone.
Microsoft doesn't make the hardware, so it's not the same situation. OEMs never put a store together, in part because in the early days of PCs there was no delivery method they could use. You had to go to a physical store or purchase something by mail. It's a completely different model, but even today there's nothing to stop Dell or HP from putting an app store on their branded PCs.
Whether anyone would use them is an entirely different matter.
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Actually, they do sell used cars from competitors...but that aside....when your store is rather dominant, anti-trust issues do come into play. Especially when you try to knock off the competition. You may approve of such practices. Most consumers do not. We don't like being left with one choice. I sincerely hope this gets the attention of anti-trust authorities worldwide.
Used cars return zero revenue to that manufacturer, so that's a bogus point. It's not like new GM cars are being sold at Lexus dealers with GM making the money from the sale. That's a more accurate comparison to the app store.
I'm actually not a fan of this move, but not for the reasons most people are giving (like the idiotic comparison to "if MS did this...").
Again, is the iBookstore available on the Kindle or the Nook? Why is it okay that they're not, but when Apple opens up it's products to competitors it's somehow now a world-ending event that they want to charge their competitors for the privilege of access.
The fact that Rupert Murdoch is okay with this model says he probably understands it better than most others who are commenting on it.
This and so many 1000's more available soon on Android... because it's free and open. Oh wait, there is no in-app purchases within Android, because their marketplace is still "cocked-up".
Comments
So somebody correct me here:
What's wrong with devs/publishers upcharging an app/subscription by 30% in the App Store, but offering a coupon code on their own individual websites that discounts the purchase price (but only through them?) Then technically they would be offering the same good at the same price in the App Store, but not be taking a hit.
It doesn't have to work exactly this way, but do you see my point? And if consumers found out about this (which they certainly would), the devs/publishers wouldn't even have to have a hyperlink in their own app-- we'd find it ourselves.
Just a thought.
I sincerely hope these services do leave or use the loophole pointed out above: price it all the same across the various distribution networks (Android Market, App Store, web store), and then offer customers a perpetual 43% discount (it's 30% of gross Apple is demanding, not net...that's actually a 43% price increase to compensate) if you buy the service anywhere but the App Store.
Barring that, I hope these services leave. Nothing will improve competition more than Apple shooting itself in the foot and compelling all these services to go to competing platforms. If they are really arrogant enough to think that their plaform will survive without any of these services, I am all for putting it to the test. After all, loyal Apple users insist that a controlled choice is good. So let's see how well iOS does when all content in the ecosystem is only distributed by Apple. It's the ultimate end-state of Apple's curation efforts.
I'm a developer who's making both iOS and Android apps. It's not the developer who makes the decisions. It's the end-user. As long as Apple holds the mind share of the public, they are going to have a lot of users. If Amazon, Instapaper and the like leave, they are shooting themselves in the foot. I think they understand this. It's going to take at least a year for the MS/Nokia deal to produce anything and by then Apple will be further ahead.
I really can't see how Netflix or Skype or Time or Rhapsody can abide by this condition. Apple is now dictating their prices across all their distribution networks and insisting that the App Store be the cheapest while taking its 30% cut. That'd be disastrous for a business like Netflix which charges $8 a month. Either they drop iOS or they have to raise prices for everybody. So now Apple gets to tax Android and web users? Even worse, the policy basically bumps off any competing media distributor (Amazon, B&N, etc.), which given Apple's proclivities towards issues like censorship (er?"curation") should be deeply disturbing to anybody.
I find it disturbing that Apple fans actually support this. Would anybody here have said the same thing if Microsoft had said that you were only allowed to buy software (approved by them of course) for your PC from a Microsoft store and then turned around and insisted that not only should they get a 30% cut of intial app sales but also a 30% cut of every subscription sold and every transaction made from the app? Oh?and you've got to price the subscription the same, inside and outside the software. If Microsoft had done this, people would be screaming, "bloody murder." But people defend this move because, "Apple made the ecosystem." Gimme a break.
Should Apple get compensated for their efforts in maintaining the store? Sure. And if the $99 per year that they charge for the app is not enough, then I'm sure they can negotiate higher rates. A 30% cut of every transaction and every subscription, however, borders on extortion. Hell, that's more than double the sales tax in most countries.
Developers forget to mention that although they pay a hefty 30%, they have no advertising costs, no distribution costs and their app can potentially be purchased worldwide. That's also worth a lot of money...
Who says you have no advertising costs? Apple does very little promotion for you unless you are a real cool app or rack up some impressive download / purchase numbers and make one of the top 10/25/50 lists. The real successful apps have had to do their own marketing and promotions just like any other software product. Read up on Angry Birds on how they blasted the internet to get more sales. Big names like Amazon, Hulu and Netflix can ride on the million of customers they already have and the millions they are spending in marketing to get their app downloaded.
I really can't see how Netflix?
According to Apple's newly posted iOS developer's terms, rentals are not affected.
Who says you have no advertising costs? Apple does very little promotion for you unless you are a real cool app or rack up some impressive download / purchase numbers and make one of the top 10/25/50 lists. The real successful apps have had to do their own marketing and promotions just like any other software product. Read up on Angry Birds on how they blasted the internet to get more sales. Big names like Amazon, Hulu and Netflix can ride on the million of customers they already have and the millions they are spending in marketing to get their app downloaded.
Rentals are not affected and publishers who direct customers to the iTunes store get 100% of their price.
These outcries reflect how big Apple is, for good and for bad. And I think it's a bit overblown much like Antennagate.
For example people talking about Amazon or Netflix pulling the app. Why should they? All they need to do is delete any link to outside store or subscription service, then nothing will change. No price change. No need to pull off.
Amazon can delete in-app links to their store. Make it purely a reader app. Have people go to Safari to purchase book. Once it's purchased it'll be on your account. Go back to the app, sign in and read. Apple get nothing.
Netflix? Just don't put any subscription service in the app. Have people subscribe on website then if you want to watch it on your iPad, pick it up, sign in and watch. Apple also get nothing.
If you want the convenience of Apple system then pay. If you don't want to pay, don't use it.
Do I understand something wrong?
Yeah. You're not allowed to link away. So in your scenario, you can't even link people to the web store. You just have to tell people to go to the store (can't direct them there). These apps will have to be pure content consumption tools....setting them at a distinct disadvantage to whatever competing service Apple offers itself. I don't even know why Amazon or Netflix would even bother. I think it's far better to pull out completely at this point and make a statement. For a company like Skype, they'd have to actually reduce features in their app. No more buying credits through the app. Skype and its customers suffer. Apple comes out ahead. Actually, I'm not even sure if Skype is allowed to even operate in iOS if they still sell credits elsewhere.....maybe they'll pull out too.
Fact is that some of these "too big to ignore" companies are freeloading on THE ONLY WORKING MOBILE platform on the planet.
You mean like Apple is freeloading off of Windows, the DOMINANT desktop OS on the planet?
If the iPod had stayed exclusive to Macs what are the chances we'd even be discussing Apple right now except in the past tense? How quickly would Apple start to tank if Microsoft could find some legal way to prevent Apple devices from working on the Windows platform?
The conceit that companies are leeches, parasites or freeloaders is just ridiculous. Apple benefits from having Netflix, Hulu, Kindle, etc. on the iOS platform. And in return, those companies benefit from being on the iOS platform. It's a symbiotic relationship. It's the apps that make iOS more attractive than other smartphone platforms. How many times has someone rattled off the 300K iOS apps vs the 135K Android apps (or whatever the exact numbers are now) as a reason for iOS's success?
As someone else said, I wonder if part of this is to get competing services off of the iOS platform. As has been repeated already, there's no way Kindle can support staying on iOS with Apple now set to take 100% of Amazon's cut of the sale price of every book. The same for all other e-reader book stores. Which leaves the iBookstore the only game in town, only now with a stronger position to negotiate with the content providers (after all, if they want to be on iOS they're only option will be Apple). With Netflix, Hulu, Rhapsdody and other audio/video content providers gone, options narrow back to the iTunes Store. If Apple is prepping a subscription music service, now would be a good time to get the competition off of iOS and then announce the new iTunes subscription service.
According to Apple's newly posted iOS developer's terms, rentals are not affected.
Does Netflix count as a rental or a subscription service? After all, it's a flat rate for x amount of movies. Sounds like a subscription to me.
I wonder how so suddenly apple got a 100% market share in book publishing inside iOS...
You mean the way the Kindle and Nook currently have a 100% market share inside their platforms?
Newsflash: This is not about iOS! This is about the app store! They are two different things. I'm tired of people making comments like, "What if Microsoft charged for every application you loaded onto Windows?" Microsoft never had an app store, but if they had -- a source for applications that they built where users could purchase software with a single, easy to use interface -- then they would be perfectly within their right to charge a fee for it.
The app store is not the web! It's a curated storefront created and maintained by Apple, where they are allowing competitors access to Apple's customers. How many GM cars do you see being sold at Lexus dealerships?
... Should Apple get compensated for their efforts in maintaining the store? Sure. And if the $99 per year that they charge for the app is not enough, then I'm sure they can negotiate higher rates. A 30% cut of every transaction and every subscription, however, borders on extortion. Hell, that's more than double the sales tax in most countries.
And $99/year is more than double the cost of a meal at McDonald's, and has about as much to do with the fee to join the developer program as sales tax has to do with the 70/30 revenue split.
A 30% cut is, in reality, much less than developers "distribution costs" have traditionally been. For publishers of periodical content, despite some grumbling, this will end up working out just fine for them since most of their revenue comes from advertising anyway, and Apple gets 0% of that revenue. For "developers" like Amazon and Netflix, the whole thing is overblown. Since 100% of their sales will never come through in-app purchasing, and Apple is simply requiring that as an option, they won't be paying 30% of their total related revenue to Apple. Frankly, I'd be surprised if what they end up paying is even 5% of their total related revenue, probably much less.
Highly unlikely. Their sales would be hurt significantly by a subscription model. It's easy to get someone to pay $.99 for a app but $.99 a month would be a deal breaker for most so any retooling would just be them shooting themselves in the foot.
If I have an app priced at $0.99 on straight sell, I would price it as $0.1/month for 12 months. Seems it might be even easier to hook someone, and I got more out of it. Plus I would have paid Apple less, if their subscription model is lower priced.
Of course, I would have to actually offer some content through the app to quality. But there's always something one could think up.
So a non-uniform pricing model is certainly open to gaming. The only way to avoid that would be to make non-uniform deal only available through individual negotiated deal with the app publisher. But that opens another can of worm in itself.
I don't think so; Apple may desire affordably low prices, but Google's eventual aim is NO price at all, as their market strategy is focussed on commoditisation which allows them to push their advertising cash cow to everyone everywhere, which will be to the detriment of said publishers and developers and much to Google's prosperity.
That would be the last resort of the desperate.
That's BS. I know there's this myth with Apple Fans that Android geeks don't pay for content. But it's not true. The only reason that paid content on Android Market isn't doing well is because Google has cocked up payment methods and has not made paid apps accessible in every country yet. When that changes (and that seems to be Google's big push right now), paid apps will take off in Android land too.
Now if that was the hidden motive instead of an "evil" money grab... That would be cool
+1
If getting everybody to go to the web with HTML5 is Apple's goal, I will wholeheartedly back them. Somehow though, I seriously doubt that's their end game here.
And $99/year is more than double the cost of a meal at McDonald's, and has about as much to do with the fee to join the developer program as sales tax has to do with the 70/30 revenue split.
I only bring up the $99 because people keep spouting off about apps being free. That's BS. They are most certainly not free. And I would never suggest that they should be. Ditto for the 70/30 split for app sales.
Now as to this subscription business.
A 30% cut is, in reality, much less than developers "distribution costs" have traditionally been. For publishers of periodical content, despite some grumbling, this will end up working out just fine for them since most of their revenue comes from advertising anyway, and Apple gets 0% of that revenue.
Agree?up to a point. I have an issue with Apple dictating the pricing outside of their little universe. But hey, these developers are grownup business people, they can decide if it makes sense for them to play with Apple.
For "developers" like Amazon and Netflix, the whole thing is overblown. Since 100% of their sales will never come through in-app purchasing, and Apple is simply requiring that as an option, they won't be paying 30% of their total related revenue to Apple. Frankly, I'd be surprised if what they end up paying is even 5% of their total related revenue, probably much less.
Except, that Apple now dictates that you must offer a subscription model through the app and you must price it the same as elsewhere and you must pay Apple a 30% cut. In essence, Apple is hoping to redirect business from their other distribution networks to the App store and get a 30% from it. That's going to be a lot more than 5%.
Beyond that, I see this as purely anti-competitive. This is a dick move by Apple to basically eliminate competition before they get to go to the studios and networks and content creators and say to them, "There's only way to sell your content to our 160 million+ client base. That's through us." No more Netflix Watch Instantly or Hulu Plus or Kindle. From now on, all content runs through an Apple branded service (iTMS, iBookStore, etc.). If that's not abusing a dominant position in one field to create an unfair advantage in another, I don't know what is. Microsoft got its peepee slapped for a lot less than what Apple is attempting here.
I find striking similarities to this subscription policy and if I were betting on anyone, I'd put money on Apple. It's not to say that they're right or wrong, but they're drawing upon their past experiences (including a lot of hostility with these same publishers). But regardless of all the apoplectic responses on this forum, Apple has a goal in mind and will drag the publishing industry along. It may be traumatic and painful, but publishers who sign on will likely see a new source of revenue that may offset and even reverse their declines over the past few years. And if Apple's wrong, they will adjust their policies to help improve the ecosystem for both their customers and publishers.
The publishing industry is a complex beast, with fiefdoms that have been established long ago. They aren't used to having a powerful outsider like Apple come in and dictate their world to them. But money talks, and that's the key to how this plays out.
Does Netflix count as a rental or a subscription service? After all, it's a flat rate for x amount of movies. Sounds like a subscription to me.
It doesn't matter. You can't use the new API to rent content directly through the iTunes store.
And as Apple has posted in their press release, "?publishers can sell digital subscriptions on their web sites, or can choose to provide free access to existing subscribers. Since Apple is not involved in these transactions, there is no revenue sharing or exchange of customer information with Apple,"
I would suggest that it covers the likes of Netflix.
I'm tired of people making comments like, "What if Microsoft charged for every application you loaded onto Windows?" Microsoft never had an app store, but if they had -- a source for applications that they built where users could purchase software with a single, easy to use interface -- then they would be perfectly within their right to charge a fee for it.
So you'd be okay with MS insisting that all software be purchased through a Windows Store and that MS take a 30% cut off every transaction in the Windows universe.
Wow.
MS must have the dumbest executives on the planet. Imagine the billions they could have made taxing iTMS sales at 30% alone.
The app store is not the web! It's a curated storefront created and maintained by Apple, where they are allowing competitors access to Apple's customers. How many GM cars do you see being sold at Lexus dealerships?
Actually, they do sell used cars from competitors...but that aside....when your store is rather dominant, anti-trust issues do come into play. Especially when you try to knock off the competition. You may approve of such practices. Most consumers do not. We don't like being left with one choice. I sincerely hope this gets the attention of anti-trust authorities worldwide.
That's BS. I know there's this myth with Apple Fans that Android geeks don't pay for content. But it's not true. The only reason that paid content on Android Market isn't doing well is because Google has cocked up payment methods and has not made paid apps accessible in every country yet. When that changes (and that seems to be Google's big push right now), paid apps will take off in Android land too.
Like I said above in a post: The only working mobile platform on the planet.
How many times does that have to be said? There is NO competing platform except for Apple's... yet!
If the landscape changes, maybe Apple will reconsider.
However, as someone mentioned, maybe it is because Apple is trying to force their own offerings in the future. That data center is sitting just waiting for something to fill it and stream out of.
It comes down to the fact that every single store of any kind, has been "cocked-up" as you say. If... if... if.... yeah... I personally would LOVE to see someone besides Apple come out and actually do something about this.
Same as the hardware story: where are all those great iPad-killers? How many people use them? What's the market situation look like to get me as a consultant to advice my clients that they better get developing quick for the Android market... which BTW, is still "cocked-up" as we speak... as is their platform truth be told.
Geez!
There is NO competing platform... yet!
Which is why there should be anti-trust implications.....
If the landscape changes, maybe Apple will reconsider.
And if the landscape changes (and I hope it does), this problem will sort itself out pretty quickly. There is no way Apple would have even contemplated something like this if the market was truly competitive.
And there's hope:
http://venturebeat.com/2011/02/16/pa...ndroid-market/
http://www.pcworld.com/businesscente...acing_ios.html
So hopefully, if anti-trust threats don't work, I hope the competitive threat can keep Apple in place.
However, as someone mentioned, maybe it is because Apple is trying to force their own offerings in the future.
I think so too. Once they kick Netflix and Hulu Plus off, they'll have lots of negotiating power with Hollywood....something they can't have as long as there are competing services.
So you'd be okay with MS insisting that all software be purchased through a Windows Store and that MS take a 30% cut off every transaction in the Windows universe.
Wow.
MS must have the dumbest executives on the planet. Imagine the billions they could have made taxing iTMS sales at 30% alone.
Microsoft doesn't make the hardware, so it's not the same situation. OEMs never put a store together, in part because in the early days of PCs there was no delivery method they could use. You had to go to a physical store or purchase something by mail. It's a completely different model, but even today there's nothing to stop Dell or HP from putting an app store on their branded PCs.
Whether anyone would use them is an entirely different matter.
Actually, they do sell used cars from competitors...but that aside....when your store is rather dominant, anti-trust issues do come into play. Especially when you try to knock off the competition. You may approve of such practices. Most consumers do not. We don't like being left with one choice. I sincerely hope this gets the attention of anti-trust authorities worldwide.
Used cars return zero revenue to that manufacturer, so that's a bogus point. It's not like new GM cars are being sold at Lexus dealers with GM making the money from the sale. That's a more accurate comparison to the app store.
I'm actually not a fan of this move, but not for the reasons most people are giving (like the idiotic comparison to "if MS did this...").
Again, is the iBookstore available on the Kindle or the Nook? Why is it okay that they're not, but when Apple opens up it's products to competitors it's somehow now a world-ending event that they want to charge their competitors for the privilege of access.
The fact that Rupert Murdoch is okay with this model says he probably understands it better than most others who are commenting on it.
http://www.appleinsider.com/articles...pples_ire.html
This and so many 1000's more available soon on Android... because it's free and open. Oh wait, there is no in-app purchases within Android, because their marketplace is still "cocked-up".
How convenient.