Apple tells newspapers: no free iPad edition for print subscribers
A number of European newspapers have reportedly been told by Apple that they can no longer offer paid print subscribers free access to an iPad edition through the App Store, as the subscription strategy leaves Apple out of its 30 percent cut.
According to a report issued Friday by deVolkskrant (via Google Translate), Apple has employed "stricter rules" for publishers, informing them that they cannot offer free iPad access to paid print subscribers. By offering free access to print subscribers, newspapers could avoid charging for access through the iPad, and can avoid paying Apple a 30 percent cut of all transactions on the App Store.
In addition, nrc.nl reported Friday (via Google Translate) that Apple will no longer allow newspapers to offer free access to print subscribers after April 1. Content providers are upset with the change, characterizing the move as one that makes Apple "too dominant."
The alleged changes sent out to publishers by Apple come as the company is believed to be working on an update to iOS, its mobile operating system that powers the iPad, that will allow recurring subscriptions for software on the App Store. It is Apple's preparation for the new subscription option that is believed to have allegedly delayed the release of The Daily, a new iPad-only newspaper from media giant News Corporation.
While a number of reports from overseas claim that Apple has contacted publications to inform them of the changes, no such reports have yet emerged from any newspapers in the U.S.
It's possible that the application programming interfaces necessary to allow recurring software subscriptions through the App Store could be a part of the currently-in-beta iOS 4.3, though the first build of the software released for testing to developers this week makes no mention of such a feature. Rumors have suggested the iOS 4.3 update could be publicly released in March.
Apple is rumored to show off the feature, along with The Daily, at a forthcoming event in San Francisco. Numerous reports have indicated that Apple Chief Executive Steve Jobs will share the stage with News Corporation CEO Rupert Murdoch at the San Francisco Museum of Modern Art.
According to a report issued Friday by deVolkskrant (via Google Translate), Apple has employed "stricter rules" for publishers, informing them that they cannot offer free iPad access to paid print subscribers. By offering free access to print subscribers, newspapers could avoid charging for access through the iPad, and can avoid paying Apple a 30 percent cut of all transactions on the App Store.
In addition, nrc.nl reported Friday (via Google Translate) that Apple will no longer allow newspapers to offer free access to print subscribers after April 1. Content providers are upset with the change, characterizing the move as one that makes Apple "too dominant."
The alleged changes sent out to publishers by Apple come as the company is believed to be working on an update to iOS, its mobile operating system that powers the iPad, that will allow recurring subscriptions for software on the App Store. It is Apple's preparation for the new subscription option that is believed to have allegedly delayed the release of The Daily, a new iPad-only newspaper from media giant News Corporation.
While a number of reports from overseas claim that Apple has contacted publications to inform them of the changes, no such reports have yet emerged from any newspapers in the U.S.
It's possible that the application programming interfaces necessary to allow recurring software subscriptions through the App Store could be a part of the currently-in-beta iOS 4.3, though the first build of the software released for testing to developers this week makes no mention of such a feature. Rumors have suggested the iOS 4.3 update could be publicly released in March.
Apple is rumored to show off the feature, along with The Daily, at a forthcoming event in San Francisco. Numerous reports have indicated that Apple Chief Executive Steve Jobs will share the stage with News Corporation CEO Rupert Murdoch at the San Francisco Museum of Modern Art.
Comments
The print price can be reduced by $0.70 and they can charge $.99 via iTunes App Store.
Apple gets it's 30% of $0.99, publisher gets the same revenue, and customer pays $0.29 more.
Isn't this the same model Netflix works on? You pay Netflix for instant streaming then get the Netflix app for free. Each month, Netflix gets their membership fee and Apple gets Zilch. Or is there some other agreement with Netflix? Not making a judgement either way, just noting the similarity and wondering if there's more going on there.
Netflix isn't offered in "print". Newspapers could still offer a free iPad addition to digital subscribers, which is why I don't understand what the big deal about subscription pricing is. If newspapers make a digital version viewable on the web or on other devices, they don't even have to think about giving Apple a cut or negotiating all these subscription pricing details.
Isn't this the same model Netflix works on? You pay Netflix for instant streaming then get the Netflix app for free. Each month, Netflix gets their membership fee and Apple gets Zilch. Or is there some other agreement with Netflix? Not making a judgement either way, just noting the similarity and wondering if there's more going on there.
Interesting point, there are countless apps in the app store that make money in a way that does not give Apple a cut.
Netflix and Hulu+ being two of the most obvious.
Oh bad, greedy, selfish Apple! Bad Apple!
Netflix isn't offered in "print". Newspapers could still offer a free iPad addition to digital subscribers, which is why I don't understand what the big deal about subscription pricing is. If newspapers make a digital version viewable on the web or on other devices, they don't even have to think about giving Apple a cut or negotiating all these subscription pricing details.
According to the article, apparently they do need to give Apple a cut or their app isn't going to be in the App Store. The comparison to Netflix is a good one. Apple gets nothing from them, even though it's a subscription service. It's unclear how newspapers are any different.
Hardly a show stopper!
The print price can be reduced by $0.70 and they can charge $.99 via iTunes App Store.
Apple gets it's 30% of $0.99, publisher gets the same revenue, and customer pays $0.29 more.
That would hardly work, as it assumes that every print subscriber wants the iPad app. The only way I could see that happening is for the paper to continually monitor print and app subscription lists and cut off print subscribers who don't keep up with their app subscriptions. I really don't see why they should be forced to do that, since the existing model is already in use across a wide variety of print periodicals. That is, print subscribers get access to premium web content.
Apple products- so cool, Apple Inc- soo controlling.
Not cool. I get NYTimes for free on my iPhone. Why shouldn't I get it free on my iPad if NYTImes wants to give it to me?
Apple products- so cool, Apple Inc- soo controlling.
The NY Times is going to start charging for their iPad edition. The service is free only during the intro period. It seems they or anyone else could continue to give it away (as does NPR, for instance), but not load the cost onto a print subscription so as to avoid giving Apple a cut. That's the way I read it.
I wonder how long it will be before Apple is sued or decides to be reasonable and reduce it's 30% cut on the revenue. This high a percentage is just not called for and is abusive.
I love the way people without a clue are so eager to prove that.
The average cut that a retail store gets is 50% of selling price. Even other online electronic distribution systems are typically in the 30% range (look up what Google and Amazon and everyone else does).
There is absolutely nothing illegal about charging a lot of money for a service. If the market, on average, was such that distributors kept 95% of the revenue, then keeping 95% would not be illegal.
The only remote argument that could even possibly made involves abuse of monopoly power. To win that, you'd have to prove:
1. Apple has a monopoly (considering how much the Android and RIM folks are bragging that Apple is just a minor player, this will be hard).
2. Apple abused its monopoly position for illegal gains. The most common way to do that would be to argue, for example, that they gave a better price to people who didn't use Android Store. Since that's not the case (everyone has the same terms, as far as we know), winning such a case would be nearly impossible.
It's easy enough to get around it. As someone suggested, the paper could offer a $.99 discount to people if they sign up for their electronic subscription and then charge $0.99 for a lifetime subscription on iTunes.
Instead I would like the journalists to allow me to purchase/subscribe to their news thru a App on my iPad.
This is just one side of the story, but disagree strongly with what's been described here. I'm hoping there's a good explanation from Apple for it.
Yup
Just a guess- if the updates and daily feed is hosted by Apple, by all means Apple has a right to the cut of the subsciption or charge a fee etc (which I suspect is the case).
But, if the hosting and updates are coming from someplace else... and Apple is just being a bully because it can (we are the only game in town, take it or leave it), that would be a monopolistic practice which people tend to not like(*cough* Microsoft).
As an aside - I don't know about periodical 'apps'. Why not just password access to web sites and have ability to save content pages or something. Either way your downloading a lot of info.
According to the article, apparently they do need to give Apple a cut or their app isn't going to be in the App Store. The comparison to Netflix is a good one. Apple gets nothing from them, even though it's a subscription service. It's unclear how newspapers are any different.
I agree. This is weird, if true.
Something tells me that this story is fishy. Let's wait and see.
for in-app subscriptions, apple will charge closer to 10%