Apple backs down on in-app purchasing rules, allows lower prices for out-of-app purchases

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  • Reply 101 of 142
    docno42docno42 Posts: 3,709member
    Quote:
    Originally Posted by Wiggin View Post


    But do you really think Apple's expenses to run the App Store are 30% of revenue and that Apple doesn't make a profit? I realize there are a lot of free and extemely low priced apps, but I find it hard to believe that Apple's operation is that inefficient.



    It has nothing to do with inefficiency and everything to do with laymen that have absolutely no experience with the real operational costs associated with running a business - let alone a project - having completely unrealistic and simplistic ideas about "cost" and "profit". I now understand why it is such a small percentage of the population who can be successful at either starting, running or managing a business...
  • Reply 102 of 142
    docno42docno42 Posts: 3,709member
    Quote:
    Originally Posted by cmf2 View Post


    Glad Apple came to their senses over this. I've had many a heated discussion on these boards over this topic, so this reversal feels somewhat vindicating.



    If a significant amount of publishers (I'll be nice and won't even ask for a majority) price content via in-app purchase differently, I'll be shocked. Have fun waiting to be "vindicated".
  • Reply 103 of 142
    macrulezmacrulez Posts: 2,455member
    deleted
  • Reply 104 of 142
    docno42docno42 Posts: 3,709member
    Quote:
    Originally Posted by cincytee View Post


    Convenience. Consumers have always been asked to pay more for any service they can be convinced is a greater convenience. Banks charge for the convenience of ATM access (and some now charge for teller access [!]), and customers shrug and pay. This will be no different.



    It's more than convenience - it's also about bringing you new customers. I guarantee, if it wasn't' for the Kindle app on the iPad I wouldn't own the growing library of Kindle ebooks that I have. I doubt I'm alone. There are 200 million iOS devices. And with iOS 5 and the dropping of the requirement for a computer, Apple is now opening up markets for those who don't even own a computer - or if they do own one, barely use it for more than email or basic web browsing. The potential iOS userbase is a HUGE market - and that has value. Apple created it, so they should get a cut.



    That these concepts are confusing or flat out misunderstood is depressing...
  • Reply 105 of 142
    docno42docno42 Posts: 3,709member
    Quote:
    Originally Posted by tjwal View Post


    Would someone pay $13 for a book through Itunes or exit an app and get if from Amazon for $10? It doesn't take a genius tp figure out what most people would choose.



    If they didn't know they could get it for $10 on the web they would happily pay $13



    Only an arrogant or ignorant person would assume that everyone shares the same world view they do.



    EDIT: and again I find it amusing that you assume that everyone will automatically charge more now that they can...



    Then again if content publishers are as stupid as the record companies perhaps they will. And they will probably see their sales plummet just like the music companies did once they got multi-tierd pricing and went crazy jacking up prices.



    I mean you can go get a physical CD for the same or cheeper AND you have a physical CD... Yup, that whole convenience thing is overblown
  • Reply 106 of 142
    gwydiongwydion Posts: 1,083member
    Quote:
    Originally Posted by DocNo42 View Post


    Netflix distributes apps?



    No, but the other op said that they have to pay Apple because you can watch movies after paying netflix outside Apple system







    Quote:
    Originally Posted by DocNo42 View Post


    If Amazon could tap into your Microsoft or Google account history through the browsers on those platforms and allow users to seamlessly purchase an item with one click and without having to do anything else, and if Microsoft or Google were processing the transaction on the behalf of Amazon then yes - I absolutely think Microsoft and Google would be entitled a piece of that action.



    Because that's exactly what happens with an in-app purchase. Apple is providing seamless access as well as payment processing. That sounds suspiciously like a service. And not surprisingly, when someone provides a service for someone else, they tend to expect to get something for that.



    In otherwords, don't be an a$$ - ask questions that are based on comparisons that are similar enough to make sense



    Why people insult so easily without even reading what the question is?



    The other post said that out app purchase are cheating and they owe Apple money.







    Quote:
    Originally Posted by DocNo42 View Post


    See my previous response - the only thing being proven by your non-sesensical and unequal comparisons is your ignorance of the topic at hand.



    Perhaps the ignorant is the one that doesn't read the whole discussion before insulting
  • Reply 107 of 142
    gwydiongwydion Posts: 1,083member
    Quote:
    Originally Posted by DocNo42 View Post


    The $99 developer license?



    Just how cheap do you think bandwidth is?



    It doesn't mind, Apple doesn't charges for it, the developer license is all you need to put applications and is all you need to be distributed.



    And if Apple think it's expensive, they can charge for it.
  • Reply 108 of 142
    anonymouseanonymouse Posts: 6,681member
    Quote:
    Originally Posted by MacRulez View Post


    Forgive me if I overlooked something obvious. Could you kindly help me find the post where someone here said that Apple's new policy, which now requires nothing in the way of cheating for any publisher to exercise nearly any payment option they like, was described as requiring publishers to "cheat?"



    Forgive me if I overlooked something obvious. Could you kindly help me find the post that makes this comment relevant?
  • Reply 109 of 142
    srangersranger Posts: 473member
    Quote:
    Originally Posted by MacRulez View Post


    Is convenience worth the extra 30%?

    If not, why is Apple charging it?



    This is a question for the market to decide, not me, not you, not Apple. In free markets, the customer decides the value.



    It's commonly understood in other markets that the more middlemen involved will raise consumer prices.



    This is one of the best moments a consumer can have: the ability to choose whether to pay the middleman or go directly to the vendor.



    Consumer choice is hardly a bad thing.



    This seems like a reasonable arrangement. The content provider can offer a price in the app store that is 30% more than on their web site and the customers can decide if it is worth it or not.
  • Reply 110 of 142
    felipurfelipur Posts: 42member
    Quote:
    Originally Posted by DocNo42 View Post


    So in your mind, the 30% that Apple was charging was 100% expense?



    Put another way, Apple brought absolutely no value for that 30%?



    As was exhaustively discussed when Apple first introduced this policy, the quantifiable value that Apple brought was around 3%, the cost of the credit card processing. As all other costs are borne by the publisher, not Apple, the remaining 27% sure looks like an expense.



    Sure, Apple does bring some difficult to quantify value in the form of customer leads ("bringing the customer"), but many of us find it hard to believe that's 27% of the value of the transaction. There are not many industries where sales guys get 27% sales commissions. For any kind of one time commodity sale (books, etc), there is no way profit margins are high enough to support that kind of commission.



    Apple has wisely recognized this and backed off some. Magazine publishers may still be willing to pay the 30% because the acquisition costs of a new subscriber may pay off over many years of subscriptions. Some may pass along the 30%, or maybe only 15%, or maybe none at all. Other markets, Netflix, Amazon, will probably just skip in-app purchases because it doesn't make much sense for them.



    In my mind, the real justification for Apple pushing in-app purchasing was controlling the quality of the ecommerce transaction. Handling electronic purchasing is hard to do safely and securely. I like that Apple is providing in-app purchasing, handled by them in a secure manner, or forcing the app to go completely outside the app to handle the purchasing. This prevents a lot of custom purchasing systems produced by programmers who are not really experts in that area and a likely source of problems.



    I see absolutely no downside to the new policy and am glad Apple has arrived at something I think is workable for everyone.
  • Reply 111 of 142
    cmf2cmf2 Posts: 1,427member
    Quote:
    Originally Posted by DocNo42 View Post


    If a significant amount of publishers (I'll be nice and won't even ask for a majority) price content via in-app purchase differently, I'll be shocked. Have fun waiting to be "vindicated".



    The vindication is in the fact that Apple reversed policy and my Kindle and Netflix apps are now safe because they don't have to offer in app purchases (at a loss to themselves) to stay in the app store.
  • Reply 112 of 142
    addaboxaddabox Posts: 12,664member
    Quote:
    Originally Posted by DocNo42 View Post


    I wouldn't have had to if you handn't quoted his entire message.



    Thanks for nothing...



    And now you've quoted my "entire message" as I have quoted yours. Damn.



    At any rate, since the guy's message was a single line and I responded to it, it was going to be a little tricky to edit it down. Or maybe I should just stop quoting and start throwing stuff out with no apparent motivation, which could be interesting.



    I'm guessing you don't want me to respond at all to posts you feel are beneath you; regrettably this is not your call.
  • Reply 113 of 142
    cmf2cmf2 Posts: 1,427member
    Quote:
    Originally Posted by DocNo42 View Post


    If a significant amount of publishers (I'll be nice and won't even ask for a majority) price content via in-app purchase differently, I'll be shocked. Have fun waiting to be "vindicated".



    The vindication is in the fact that Apple reversed policy (as I had suggested they would, or face a lawsuit) and my Kindle and Netflix apps are now safe because they don't have to offer in app purchases (at a loss to themselves) to stay in the app store.
  • Reply 114 of 142
    I'm not defending apps that facilitate drunk driving but here in Albany, NY (where good old Chuck Schumer represents), the local newspapers and radio stations broadcast DUI sweeps a week in advance. Where do they get the info? Local and County law enforcement. Hmmm. I'd like to see the politicians try to shut down the "news media" for being guilty of the same thing as the apps! Not with elections always around the corner. If I have to share the road with a drunk driver, I'd choose one that can open and read the app vs. one who heard/read it 20 times that week.
  • Reply 115 of 142
    anonymouseanonymouse Posts: 6,681member
    Quote:
    Originally Posted by felipur View Post


    As was exhaustively discussed when Apple first introduced this policy, the quantifiable value that Apple brought was around 3%, the cost of the credit card processing. As all other costs are borne by the publisher, not Apple, the remaining 27% sure looks like an expense.



    Sure, Apple does bring some difficult to quantify value in the form of customer leads ("bringing the customer"), but many of us find it hard to believe that's 27% of the value of the transaction. There are not many industries where sales guys get 27% sales commissions. For any kind of one time commodity sale (books, etc), there is no way profit margins are high enough to support that kind of commission. ...



    It may have been exhaustively claimed that the, "quantifiable value that Apple brought was around 3%", but it was a) never established as correct, and b) irrelevant since, as I must once again point out since some of you refuse to accept this very simple and very obvious fact, the App Store is not a fee for service or a commission for service based system. It's a revenue sharing system, so your entire analysis is misguided and utterly pointless.
  • Reply 116 of 142
    pendergastpendergast Posts: 1,358member
    Quote:
    Originally Posted by newagemac View Post


    Yeah, everyone except consumers. This new ability to jack up prices is not good for consumers.



    Then don't buy it In-App. Go to the web where it will be priced "normal".
  • Reply 117 of 142
    macrulezmacrulez Posts: 2,455member
    deleted
  • Reply 118 of 142
    tenobelltenobell Posts: 7,014member
    I don't know if I can agree that what Apple brings is only 3% of the value. They bring the entire iOS ecosystem, the App Store, and over 200 million customers. Without Apple's efforts none of that would exist in the way it does. I think that is worth far more than only 3%.



    I agree that I'm happy it comes to a conclusion that works for everyone.



    Quote:
    Originally Posted by felipur View Post


    As was exhaustively discussed when Apple first introduced this policy, the quantifiable value that Apple brought was around 3%, the cost of the credit card processing. As all other costs are borne by the publisher, not Apple, the remaining 27% sure looks like an expense.



  • Reply 119 of 142
    halfyearsunhalfyearsun Posts: 304member
    Quote:
    Originally Posted by MacRulez View Post


    You may be right, that the convenience Apple offers isn't worth the price they're asking. But I disagree, and feel that some Apple customers will appreciate what Apple brings to the table. We'll see....



    I think it may very well be worth the price. People still buy products in stores even though you can find it discounted on the Internet. People still buy albums on iTunes even though you can find it cheaper elsewhere.
  • Reply 120 of 142
    pendergastpendergast Posts: 1,358member
    Quote:
    Originally Posted by tjwal View Post


    Would someone pay $13 for a book through Itunes or exit an app and get if from Amazon for $10? It doesn't take a genius tp figure out what most people would choose.



    Why do you assume publishers will charge that much more? If they charge more, I think it would be in the neighborhood of $11 vs. $10 elsewhere, if there's any difference. More likely, the in-app price will be the normal, regular price, and elsewhere they'll run sales and specials.



    That 30% that Apple charges IS worth something. In addition to processing the credit card, Apple is providing a digital storefront with a wealth of customers and a ridiculously easy one-click way of purchasing content. Spur of the moment purchases are invaluable to content providers. By trying to get a customer to go to their website instead so they make more money, they set up additional obstacles for the customer and reduce the chances of that coveted spur-of-the-moment purchase.



    Apple's App Store and In-App model provide a service that is worth paying for, even if you have to pay more. If you're marketing your product, a highly-read well-regarded magazine is going to be more expensive to advertise in than a lesser magazine. It costs more to rent space for a storefront in the Mall of America than in a strip mall.



    Remember, publishers normally give up a cut to retailers, etc.
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