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

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  • Reply 21 of 180
    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
  • Reply 22 of 180
    zoetmbzoetmb Posts: 2,445member
    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.
  • Reply 23 of 180
    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.
  • Reply 24 of 180
    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.
  • Reply 25 of 180
    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.
  • Reply 26 of 180
    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.
  • Reply 27 of 180
    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.
  • Reply 28 of 180
    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.
  • Reply 29 of 180
    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.
  • Reply 30 of 180
    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.
  • Reply 31 of 180
    Quote:
    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
  • Reply 32 of 180
    Quote:
    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.
  • Reply 33 of 180
    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."
  • Reply 34 of 180
    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.
  • Reply 35 of 180
    gwydiongwydion Posts: 1,067member
    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.
  • Reply 36 of 180
    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.
  • Reply 37 of 180
    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?
  • Reply 38 of 180
    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 .
  • Reply 39 of 180
    gwydiongwydion Posts: 1,067member
    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
  • Reply 40 of 180
    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.



    Well now that we know how mdriftmeyer feels about it I guess we can all go home.
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