Slashdot Mirror
Apple To Keep 30% of Magazine Subscription Revenue
Hugh Pickens writes writes "The Guardian reports that Apple has launched a new subscription service for magazines, newspapers and music bought through its App Store, expanding the model developed for Rupert Murdoch's iPad newspaper and will keep 30% of the revenue from subscriptions if the subscription is purchased through Apple. 'Our philosophy is simple – when Apple brings a new subscriber to the app, Apple earns a 30% share; when the publisher brings an existing or new subscriber to the app, the publisher keeps 100% and Apple earns nothing,' says Steve Jobs, Apple's chief executive, who is presently taking a medical leave of absence from the company. 'All we require is that, if a publisher is making a subscription offer outside of the app, the same – or better – offer be made inside the app, so that customers can easily subscribe with one click right in the app.' Apple's control over its App Store payments plan has long been a cause for concern for content companies. Publishers want to have access to subscriber data which can provide lucrative demographics on which to base advertising campaigns and targeted reader offers. Apple says customers purchasing a subscription through its App Store will be given the option of providing the publisher with their names, email addresses and zip codes. The use of such information will be governed by the publisher's privacy policy rather than Apple's."
Publishers in the print world will happily sell subscriptions for less than the price of postage in order to increase their paid subscription count (and hence their ad dollars). To get 70% of the subscription money, all of the ad money, and have no printing/postage costs actually doesn't sound too bad for publishers. If Apple demanded that they get 30% of ad revenue too, that would start to be a much larger issue.
Did they just wait around for Murdoch's The Daily experiment for this? Is this just round two of wait-for-third-parties-to-develop-apps-and-then-hold-them-ransom like with eBooks? What's next?
...
If I were a mobile app developer I'd be asking myself right now if it's a smart idea to try to plan a viable business plan around iOS right now. Any good will you build by bringing people to iOS with your app is totally overlooked by Apple while any customers "they bring" to you runs a hefty 30% Apple tax.
I think it's highway robbery but I'm okay with it because I didn't buy into that bullshit. I bought into Android and instead of lording my decision over everybody I'm just going to remind everyone that the long run has been predicted by many industries. Apple and Blackberry will remain as niche players but it's going to be an Android future. So go ahead and hold publisher's -- who already hemorrhage cash -- feet to the fire. It's just going to hasten your fall.
Apple sits atop a crumbling marketshare (Schmidt claims 300,000 activations a day) and their response is to turn the screws on the third parties that set them apart from the competition? Doesn't make a whole lot of sense to me
My work here is dung.
Most magazine distributors only charge 7 cents per copy (about 2%), and that's for dead trees. It should be a LOT cheaper for electronic editions, or at least the same price, not a higher amount.
Information wants to be expensive AND wants to be free. So you have Value vs. Cheap distribution fighting each other.
To get 70% of the subscription money, all of the ad money, and have no printing/postage costs actually doesn't sound too bad for publishers.
Okay but why not just go to the Android Market where you get 100% of the subscription money, all of the ad money, and have no printing/postage costs?
My work here is dung.
Is that 30% for as long as they keep renewing or is it 30% for the initial term? How does one determine if it's a new subscriber?
Also, charging the same price in and out of the apple verse could increase prices for all
They are taking a page from the bankers..
A one time commission for making a sale, doing some marketing, etc is fine. Normal business practice. Scooping a portion of the revenue stream *forever* is never done unless the scooper has way too much power.
You notice Apple is taking no risk if the magazine fails? They have no downside and unlimited upside. Sound familiar?
Was anybody seriously expecting the app store not to degenerate into blatant rent seeking?
The original deal, while compulsory(which is not a good sign) was a 30/70, where apple took 30 in exchange for hosting the thing, transaction handling, etc. The fact that that was the only deal in town was a bit skeezy; but it was certainly a boon for the indies who couldn't or didn't want to deal with logistics themselves.
At this point, though, it's a pure money grab. Hey, Amazon, want to offer customers the ability to purchase ebooks(downloaded from your server, linked to their amazon accounts, through the kindle application)? 30% of that is ours, and you aren't allowed to charge a higher price in-app to make up for that. You don't like that? Well, it's a nice app you've got there. It'd be a pity if it were to suffer a cryptographic revocation accident, Capiche?
This is a serious question. Apple set up the App store with the intent that they host and provide ads and what not, and they get their 30%. They are in fact providing services, so Apple's model makes sense to me, at least in terms of fairness. In terms of competition it's an entirely different matter.
It's fairly easy to post a free app to a specific Market, which is marketed and hosted by the android market, but since it's free, they get no money. You could then create an in app subscription model where you get all the subscription fees and the Android market gets nothing even though they are doing some of the lifting for you, namely app marketing and hosting.
Originally the iTunes store was a loss leader for selling iPods and creating a top to bottom environment for people to buy and consume content. Now it's a money making powerhouse for all iOS devices. Perhaps the Android Market is doing the same thing in it's early stages, but it doesn't have the benefit of music or movie downloads to help (does it?) and it would have to start turning a profit quickly to be sustainable unless Google plans on simply sinking money into it.
Again this is a serious question I'm trying to understand the model.
"All great wisdom is contained in .signature files"
The issue here is that Apple is demanding the option for users to purchase content directly through the app. Currently, most publishers have been handling payment through their own online payment service. Apple would still be letting people pay through those services, but would also force app developers to give the option to pay through Apple's payment service. If you don't want to support Apple's new subscription service, your app gets rejected.
So how long until the Netflix app gets rejected? I can't imagine Netflix would allow Apple to keep a 30% cut of their revenues. Same for Kindle. While Kindle doesn't use subscriptions, this same policy will force them to allow in-app purchases, which Amazon would lose money on. There should be major backlash on this.
There is not a single Android tablet in the market now or in the near future that comes even remotely close to the user experience provided by the iPad. I've had one since April of last year, and it's pretty much the only thing I use when I get home.
Like iTunes, the Android Market charges 30% on app purchases and 30% on in-app purchases conducted through the Market, as well. The difference is that the Open Handset Alliance doesn't require you to use the Android Market to deliver apps to Android devices, and does not appear require that content subscriptions are available through in-app purchase on the same terms as out-of-app purchases (they do require that payment you receive for the app itself be through the Market, but do not appear to prohibit out-of-Market purchases for services or content that may be accessed through the app, especially services/content that are not exclusive to the app so that they aren't just a form of payment for the app.)
The Android Market gets paid by encouraging developers that using the Market is worth using for distributing apps and for in-app purchases.
After all, he only asks that you donate 30% of your income.
This tithe is now mandatory however, and rather than costing your soul for refusal, it will only cost you your market presence.
Whether or not to play in Apple's iOS garden is a business decision companies like Amazon or B&N will have to make. There's no reason for them to offer iOS versions of the e-readers. Oh, except for the large customer base. If that customer base is big enough I'm sure Amazon and B&N and others will agree to Apple's rules. 70% revenue for a customer pool of millions of iPhone and iPad users is better than 100% revenue for zero of them.
Apple is offering others the ability to take advantage of their platform. How many Nook books can you buy from B&N on the Kindle, or Apple iBooks on the Nook? None. Apple is creating a place where Amazon and B&N will be able to compete with iBooks on price using the same e-reader. Neither Amazon nor B&N open their gardens to competitors.
Even so, one issue that annoys me will still remain. On the iPad ATT plan, we are paying twice for content when downloaded through ATT. We pay for the content, and we pay ATT for the download. To be truly mobile, and fair, we should not have to pay for content downloaded from Apple. If this were the case, the 250 MB plan would be a great deal instead of a annoying necessity.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
And this why Android will eventually displace IOS as the mobile operating system of choice, those vendors who choose to sell only for Android will be at least 30% less expensive.
The truth is that all men having power ought to be mistrusted. James Madison
One could make the in-app ordering so much harder:
Please type this captcha with your tiny on screen keyboard to prevent wrong orders:
"l am a human! N0 or YEs.Donottypespaces or 2? Live or memorex? O or 0? 1 or I? areu? L am not.!lIlIllIIllIIIllIllIIlIlIlllIIIIIiIIlliIiL!"
[.......] - tiny entry field
Or click _this_link_ to order through our website!
Apple takes a 30% cut of charitable donations made through an app. Disaster relief, feed the hungry, all of it. Everybody pays. In an era where credit card processors are getting hit by regulators (correctly!) for charging 2-4% transaction fees, Apple says it's 30% or nothing.
You'd think the phones were free.
I welcome the mass exodus of developers from iOS to alternative platforms, and then I welcome the later transition to HTML5 instead of "apps" to deliver what should have been web pages anyway.
Reference: https://www.nytimes.com/2010/12/09/technology/09charity.html?_r=1
Yet the iPad experience is also woeful. App switching and the lack of multi-tasking is a woeful experience.. After ten minutes use the task bar of previously used apps is full and you're left scrolling to find the app you want.
Text entry is abysmal - where's the numeric row on the keyboard. If you can fit three rows on an iPhone, you can easily fit four rows on an iPad.
Mobile Safari is a poor excuse for a browser. No tabs, no ad blocking. No flash. Burrying your head in the sand and pretending it doesn't exist won't make it go away.
Apple's rules on apps mean there's no integrated groupware. Want to check your email and calendar first thing in the morning, you need to switch between two applications.
The iBooks app doesn't even let you organise your books onto separate shelves or into folders.
You're absolutely correct. No other tablet comes close. Yet. As the Android tablets mature, there are countless areas that they will be able to deliver a better end user experience than Apple's effort.
For something that's fairly cheap, 30% is a good deal to avoid all the credit card processing fees (paypal charges $.30 + 2%-3%, so it's over 30% for something that costs $1). For larger more expensive purchases, it's not such a great deal.
Most of your criticisms are just opinions (you think this is a bad implementation of feature X) so I'm not going to address them since the factual informations is correct. One in particular is an incorrect statement of fact. iBooks does let you organize your books in the latest version.
After all these years, Apple is still as capable of cutting its own throat like it was in the 80s. Oh the nostalgia.
"Neither Amazon nor B&N open their gardens to competitors."
But Android does, and Windows does. Yes, Apple is not the only company with a more locked down, rent-seeking model than fracking Microsoft, but I'm not sure why I'm supposed to like it any better rather than just hating them too.
When I pay money for products or services, I want to be treated like I'm the customer, not like I'm the product to be captured and used as leverage. If Apple is deriving profit by withholding access to me from people I'd like to do business with, why am I paying them to do it?
A high price in one market and a low price in another is an arbitrage setup, right?
So. Start a site where people can subscribe to stuff that's in these apps; but just make sure you advertise it so as to not offend the Lord and Master from Cupertino. Charge a much lower fee. The rest is pure profit.
I have used an iPad and a Galaxy. The iPad is okay for Angry Birds, but unusable for anything involving text. Scrolling is erratic. Text selection ranges from frustrating to impossible. The magnifier comes up all the time when I am trying to do something else. Flipping from one orientation to the other is buggy.
The Galaxy is quite usable.
Go green: turn off your refrigerator.
70% revenue for a customer pool of millions of iPhone and iPad users is better than 100% revenue for zero of them.
It's not when you only have a 5% profit margin. When you're losing money on every unit sold, you can't "make it up in volume."
And this why Android will eventually displace IOS as the mobile operating system of choice, those vendors who choose to sell only for Android will be at least 30% less expensive.
I doubt that. Do you actually think that if Amazon sold a book on the iPhone for $10, they'd sell the same book on Android for $7? Why would they give you the three bucks? They'll sell it for the same price on ALL platforms and just keep the extra they make from non-iOS sales.
"Apple To Keep 30% of Magazine Subscription Revenue" of subscriptions purchased through their store infrastructure and through their servers. Publishers are not restricted from also providing a link to their own website as long as the link is in addition to in-app purchases, and the pricing must be equal or better for the in-app purchase.
Not such a big deal.
And this why Android will eventually displace IOS as the mobile operating system of choice, those vendors who choose to sell only for Android will be at least 30% less expensive.
Just like PC market-share is increasing every year, because PCs are at least 30% cheaper than Macs? ;-)
I don't own an iPad and buying an eBook for my iPhone never seemed too attractive.
Is there actually an iBookstore equivalent on Android?
I think "mobile operating system of choice" may be misleading. Apple will simply continue to siphon-off the top-profits from the market and leave the rest to whomever wants to fight for it.
Windows 2000 - from the guys who brought us edlin
Amazon and Barnes and Noble are already giving that 70% to the publisher, thanks to Apple forcing everyone's hand over to this Agnecy Model for eBook distribution.
If they sell through Apple, they're gonna get dick. Nadda, zilch. Apple is trying to take the 30% they themselves were taking, and they have to give the other 70% to the publisher already.
Apple is forcing them to offer the same price in the InApp purchase through iTunes (where apple get's the 30%), as they offer through their Website Purchase (where Amazon or B&N gets the 30%). Why are people going to click through the App to Amazon's or B&N's page to purchase a book and give Amazon or B&N their money, when Apple has forced them to provide an easy In App purchase through iTunes, where the 30% goes to Apple.
Except that Amazon is not a subscription service, so it hardly even seems to apply.
Even if it did, is Amazon really going to get new customers through Apple, even if the Amazon app offered the ability to sign up via the Amazon app?
No, Amazon won't sell it for 30% less on Android (that would probably violate Apple's rules anyway), but someone else will. However, if someone with deep pockets (say, perhaps Walmart) decided to start up a competitor to Amazon and came out with their own e-reader software, they might come out with it only for Android. This hypothetical company could sell their e-books for 20% less than Amazon and make more profit. How long do you think it would take for everybody using an Android as an e-book reader to switch? How many such companies would it take for products sold for use on IOS devices to be perceived as being routinely overpriced?
The truth is that all men having power ought to be mistrusted. James Madison
That pretty much makes revenue drop by 30% for iOS platforms. How bad do the content providers want iOS ?
Sorry, you are comparing to the wrong point in the history of PCs. What I am describing is exactly how the Macintosh computer was perceived back in the day. It is also what Windows did to the MacOs when it came out.
The truth is that all men having power ought to be mistrusted. James Madison
I'm not sure how big a deal this will be for Amazon. It doesn't apply to books sales, since they aren't subscriptions. I know that Amazon offers magazine and newspaper subscriptions, but the Kindle isn't really all that great for mags and newspapers. The slow display and the lack of touch interface are fine for books, but not so good for media where you are jumping from story to story. So the iPad could bring in Amazon subscription purchases that they wouldn't otherwise get at all, in which case the 30% tax isn't such a terrible deal. And some of those people will likely order through Amazon's web site, anyway, in which case Apple gets nothing?
Still, enforcement is likely to get complicated. For example, is Amazon allowed to offer a great big button on their app's front page to link to their web site, and bury in-app purchases 3 menus down?
I don't think this affects Amazon or B&N at least as far as book sales. This is about subscriptions. You don't subscribe to a Kindle book.
Apple already made the same changes to their InApp Purchases requirements with the same 30% cut to Apple if purchased via the InApp Purchase, and that they have to offer the same price via their own website and through the Apple Store. The new Subscription Model is a continuation of the policy they've already put in place.
With Amazon and B&N, the entire garden is mobile. That's why any of this is any issue at all. These other "walled gardens" can be used from anywhere including Apple's own closed system. It's only Apple's stuff that's locked to Apple devices. The stuff from these other vendors is intended to be used on a wider range of platforms.
People can take their Amazon stuff and give Apple the big middle finger.
From that perspective, it makes absolutely zero sense for anyone to use Apple's private offerings.
A Pirate and a Puritan look the same on a balance sheet.
It doesn't really matter who keeps the difference. They will all see the injustice internally and eventually push absolutely any other advantage they can into alternative channels - if they can't differentiate on price then they'll do it on other aspects - maybe the iOS store will just not have the same range (if your margin is less by 30% then that's a whole swathe of content that goes from profitable to unprofitable) or they'll lock it down more (buy for iOS read ONLY on iOS, buy outside read anywhere), or whatever else. It may not happen for a while because they are all feeling their way through this and iOS still dominates revenue for now, but in the end it will.
You're wrong. Apple changed the InApp purchase requirements to match this weeks ago.
30% of InApp Purchases go to Apple, Website purchases go 100% to Amazon or B&N, but the InApp purchase price must be equal or lower than the website price.
Apple has already pushed the ebook industry into an Agency Model where most publishers are looking at this 70/30 split between themselves and the publisher. Apple's changes mean they're basically taking Amazon and B&N's 30% if people buy books from Amazon or B&N through InApp purchase, which is always going to be easier to do than going through the website. They're just extending these recent changes to the newly announced Subscription Model.
You have "used" both devices, meaning you have browsed Best Buy and could not afford either device, so now you think you are an expert. Everything you wrote about the iPad is a lie, and what's worse, applies directly to the Tab. On the Tab, scrolling is laggy and erratic. Generally, it's much slower. Also, iOS has over 350K apps and over 150K iPad apps. Android has 0 tablet-specific apps. Nice.
No, the GP was right, it is about how the company is actually run, who decides. Apple is run by marketing
I've seen how marketing people think. If Apple were run by marketing, there never would have been an iPod Touch because it would hurt iPod sales. The iPhone would have all the features people say they want (like a keyboard and FM radio) but don't really need. They would never have dropped floppy drives early, etc.
In short there are pretty much no products that Apple produces that show signs of being driven by marketing. Now the competition - marketing checklists galore.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Really? Then why is it that book purchases that I make through the Amazon app go into my shopping cart at Amazon, the same one as when I make a purchase via their web site? And if I purchase a book via the Kindle iPhone app, why does it still send me to Amazon's web site?
Because the rules are new and the app hasn't been updated or removed.
It's pretty clear that, unless Amazon have managed to negotiate individual rules (which would probably cause all sorts of regulatory issues) the app as it stands is not compliant with the new rules.
Whether or not to play in Apple's iOS garden is a business decision companies like Amazon or B&N will have to make. There's no reason for them to offer iOS versions of the e-readers. Oh, except for the large customer base. If that customer base is big enough I'm sure Amazon and B&N and others will agree to Apple's rules. 70% revenue for a customer pool of millions of iPhone and iPad users is better than 100% revenue for zero of them.
Apple's iOS customer base, while large, is much smaller than the general book buying customer base. With this move, Apple is trying to control the pricing on all eBook products sold. If Amazon or B&N want to continue to offer their iApps, they will have to make their eBook prices the same both in-app and on their storefront. To cover the 30% that goes to Apple they'll have to either lose money on every eBook they sold in any way to an iOS device basically, or raise their prices for everyone.
I seriously doubt Amazon or B&N either one is going to find Apple's iOS customer base large enough to justify the money loss or lowered sales due to higher prices. I'm sure they'll be complaining to regulators (I doubt this is going to fly in Europe, even if it does in the US), and more than likely dropping their apps when they come up for renewal. Apple already refused to approve Sony's eReader app last month, that was probably the first shot across the bow.
This move hurts consumers, hurts developers, and hurts publishers. The ONLY thing it benefits is Apple. I don't think this will end well for Apple though, even if the massive power grab doesn't get regulatory attention (and it's likely to do so, Apple's trying to command pricing on the entire eBook market with this move) it's likely to end with either higher prices for everyone, or the removal of some very, very popular apps. Apple may think that doesn't matter, but I just can't see people buying their eBooks from Apple just because Apple essentially demands they do so.
Amazon and the like are selling bits. How do they lose money on a sale?
Actually unless the vendor is greedy, that should read "up to 30%" instead of "at least".
...if 10% of a vendor's content purchasers go through Apple's system, and providing in-app purchasing actually increases the number of purchasers significantly, then the content vendor might determine that getting 70% of the additional purchases leaves them in a better position than they would be in if they raised their overall price to maintain the same average revenue per sale. Remember, this is digital content and the marginal cost per copy is a tiny fraction of a cent, so even if the additional option of in-app purchasing via Apple's system gives them a 3% bump in transactions against 7% of transactions moving from full price to -30%, that would be enough of a bump that it's in the vendor's best interest to just keep their prices as is.
If 100% of a vendor's content purchasers go through Apple's system, then their costs are 30% higher and they'll need to pass that along to customers.
If 10% of a vendor's content purchasers go through Apple's system, then their costs are 3% higher and they could pass that along to customers. However...
Look at the numbers: Let's say you expect 100,000 customers to buy $6.00 worth of content over a year, that's be $600,000.00. If 7% move to the Apple purchase system and you lose 30% of their revenue, or a total of $12,600. If you also get a 3% bump in buyers, then 70% of their purchases equals $12,600 and everything is perfectly balanced.
As to whether or not Android will displace iOS, well, it seems to me that if it hasn't already, from a sheer numbers perspective, it already has. Whether that means anything is a different question. As long as the chicken-and-egg pairing of consumers and developers stick to iOS in high enough numbers--if one side flees, so will the other--then iOS devices will continue selling in solid numbers, and profits for Apple and for iOS developers will continue to be quite competitive with those for Android device manufacturers and developers.
The CB App. What's your 20?
A mobile OS that tells me what software I am or am not allowed to run is out of the running by definition.
OS X is just BSD with a crappy window manager you can't get rid of.
And this why Android will eventually displace IOS as the mobile operating system of choice, those vendors who choose to sell only for Android will be at least 30% less expensive.
I have to disagree with this. While a vendor's margins might be 30% more selling though Android, I would be shocked if they passed those savings onto the customers. At the end of the day, Amazon, B&N, Apple, Google, etc. are all companies looking to make as much money as possible.
They are paying the owners of those bits for every copy that they make...(specifically, 70% of retail, in most cases. This is going to leave them pretty unmotivated to give apple 30% of retail...)
Wrong. 70% of the sale on an item that they have to turn around and give >70% of the sale to the publisher IS worse than 100% of the sale with no items being sold. In the first case they are losing money, in the second they are dead even. The size of Amazon's and B&N's customer base just means those loses would be magnified further. So given that choice they would clearly leave the iOS garden. Then Apple gets everything they want: the 30% cut from EVERY eBook sold for an iDevice, and a weakening of the Amazon and B&N user base from the loss of iDevice compatibility, which could lead to a weakening of the appeal for other mobile platforms.
This may be a "business decision", but it is being forced by a company that has claimed a large section of the mobile market and is now twisting every arm they can to increase their revenue. This is not the type of business I deal with and hope the draconian policies bite them in the ass.
Your math is wrong in many cases. -20% profit on millions is much worse than 100% of nothing.
So why dont publishers charge 30% marked up then offer a 30% after purchase refund when purchased from anywhere except iTunes store.
Sounds like two different devices - the Galaxy doesn't even track my finger when I scroll.
And to expand on your point about subscription becoming basically an impulse purchase, Apple are offering the publishers an enormous carrot: access to 160 million credit card numbers. Apple are betting huge here. They're gambling that publishers will grumble about the 30% cut they have to give to Apple, but will weigh that against the potentially huge pool of paying customers who will suddenly be presented with easy one-click access to subscriptions. How many of these people would be more willing to subscribe to content if it's reasonably priced and only one-click away, rather than signing up through the publisher's own site and having to provide payment information all over again when Apple is already in possession of it?
The real sticking point for the publishers though, isn't the 30% cut; it's that Apple refuses by default to give them access to the gold mine of customer data that goes along with those credit card numbers. Subscribers have to choose whether they want to provide the publisher with their name, home address, and email, all of which are essential for targeted marketing, a lucrative source of revenue. They're pissed that Apple is acting as a gatekeeper between them and their subscribers. But from Apple's point of view, these people are Apple's customers, not the publishers, and they're determined to provide content and services with the ease and convenience they've become accustomed to. Apple is actually providing a system that could be extremely lucrative for all concerned. Of course it could blow up in their faces if companies decide that they don't want to play ball, but I personally wouldn't bet against Apple.
Here's the thing that has spurred much of the Apple hatred in the tech community: many geeks feel that Apple don't care about them because of their "walled garden" approach, and guess what? They're right. Apple's priorities are, in descending order:
1) Apple (duh!);
2) their users;
100) everyone else;
the last group to include developers, content providers, publishers etc. Apple's brand is a contract of trust with their users, that they will provide easy to use, dependable hardware, software, and services, and they will not let any group break that contract. Do you honestly believe that the totality of people railing against the "evils" of Apple's "walled garden" constitute even a blip on Apple's radar, when compared to their tens of millions of paying customers? Keep hoping.
Despite the popular portrayal of Apple as some sort of totalitarian state sending in the digital tanks to take away our hard won tech freedoms, Apple is in fact very much a democracy. It's a democracy in which people vote with their dollars, and they voted nearly twenty seven billion times last quarter alone.
Basically 30% is 100% of Amazon's cut. It doesn't matter though. Amazon is going to do what Google did when Apple tried to block Google Voice. They will will release a mobile web application. Everything will just run in the browser. This will last a few months before Apple gives up and lets Kindle back in.
No they specifically blocked Sony's ereader application for this very reason.
This move by Apple totally screws over the authors who want to sell anywhere else but Apple - and who wants just a single distributor handling their work?
Here's how it works to the author's disadvantage. Amazon returns 70% royalties to the publisher, who then takes their cut before returning the rest to the author. If Amazon is forced to sell through the Apple store, Apple takes that 30% and Amazon gets nothing - which isn't good for Amazon. Amazon can't raise the price of books sold through Apple with a convenience fee for the ease of purchasing through the App store, nor can they discount their product in other markets, because Apple DEMANDS the lowest price available. If Amazon is to stay in business they either have to not sell through Apple at all - the publishers can cut their own deal through Apple and keep the 70% that Apple gives them leaving Amazon out entirely - or take a larger cut themselves returning say only 50% to the publishers, who will pay their authors correspondingly less as a result. In the end it will be the authors who take the hit for Apple's actions.
Frankly Apple is Evil and I wish that people wouldn't buy their overpriced, over-restricted crap.
As for Amazon, their best move would be to pull their Kindle software from Apple and focus on Android - while doing their best to sue Apple into oblivion for Illegal Tying. After all, would you buy a car that you could only fill with one brand of gasoline regardless of how high the price of that brand of gasoline went?
Or Amazon could create such a superior book buying and experience that Apple can't compete and Amazon has some leverage with them.
And if Amazon does raise prices everywhere to still eek out some profits from Apple, then ALL OF US end up paying the Apple tax even if we don't ever touch a piece Apple hardware.
We're all stupid if we let Apple get away with this crap!
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
How many such companies would it take for products sold for use on IOS devices to be perceived as being routinely overpriced?
These are Apple customers. You think they've ever operated under the impression they paid less?
Apple is right for one reason. Imagine you have a store and one day a man comes to you and say. Hey, I represent a free magazine. Can I put a stand on your store to distribute my magazine for free for your customers? You see that the magazine is cool and allow the guy to put a stand there for free. One day you notice that the guy is now offering a paid subscription service to those who come to him. He is now mounting a business inside your store and profiting for it. WIll you allow this guy to continue? Obviously not. Apple was clear. Free apps cannot sell anything and paid apps must deliver digital content to users and the content must be in one of two forms: already inside the application or on a server outside. If the user chooses the second option, the server must be prepared to talk to Apple's servers acknowledging the delivery of the digital content. What these guys were doing were mounting a store inside Apple's store. No business in planet would ever allow that. Try to make your stand inside Barnes & Nobles for free and tell me if you was successful.
False. The Kindle app was updated today.
Here is a news! Apple stock went from record high to free fall within minutes Thursday. A flash crash sent Apple stock reeling for four minutes in a $10 dip. Analysts guessed that either Steve Jobs health rumors or gaming by short-sellers triggered the flash crash of Apple stock. On the upside of things, if you wanted to invest in Apple stock, that would have been the best time to take out a payday loan and get in on the action.
My subscription rate is $30 for a year.
I need to offer a "better" rate through the app? OK
The rate through the app is FREE for a 1 week subscription (1 to a customer).
That's a neat trick -- only 5% profit margin when your incremental cost for additional subscribers is essentially zero.
You must be one of those Haavaad grads.
Have your people call my people, I've got a bridge for sale that's perfect for you
The cries of everybody that the profit margin on ebooks is only 5% deafen my ear.
Ebooks are pure revenue, especially considering how lackluster (absent?) editing is these days. The cost is some bits down the line.
I would guess that Amazon and the publishers each make an enormous amount of profit on each ebook sold, and that it only appears that they do not because of Hollywood style accounting.
Too bad you knew you had to do it anon, lest the "ostrasized geek" culture mod you down.
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
Absolutely agree. Apple does it much better than the other big companies. Evidence? Look at their MASSIVE stock price premium as compared to quarterly or annual earnings per share. Investors aren't stupid. They know Apple has positioned themselves well.
What does this even mean? Stock price is irrelevant - P/E is what matters. Apple makes more in a quarter than Google does in a year - and sports 70% annual growth - yet AAPL (20) has a P/E ratio about 80% of GOOG's (24). Don't even get me started on Netflix (81) or Amazon (74).
Apple is horrendously undervalued at its current stock price and revenue growth.
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
The trick is that it was to a large extend the support of companies like Amazon and Rhapsody that gave Apple such a customer base.
> Apple is offering others the ability to take advantage of their platform.
Apple is demanding others to offer services through their store in other to work in their platform.
As a stockholder, I'll be able to buy a Gulfstream.
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
This is pure gouging. My mobile platform is just that, a platform, a computer in my hand for interacting with the rest of the internet. To insist that if I right an app for my mobile platform I have to get Apple's permission to offer it to anyone else and that I give Apple a cut of 30% if I charge for it was bad enough. To now insist that if my app interfaces with anything else for sale whatsoever that it must be sold through Apple as well for another 30% is absolutely beyond belief. Tell Apple to Stuff It in no uncertain terms. Buy Android phones, jailbreak your phone, do whatever it takes to show Apple who owns what and who is just a provider of tools, not the robber barons we must all pay tribute to at every turn. I love Apple products. But I will not pay through the nose at every turn or be coerced in what I can do on my own devices.
What happened to you Steve? You started with the rest of us homebrew folks believing in computer power to the people. Now you are just a stuck up, greedy suit out to squeeze your customers every way you can. Screw you.
...the publishing industry's favorite little gem, data mining. Apple won't give it up, and the publishers are fuming because they want to spam subscribers. I wonder what "do no evil" Google will be doing with their subscriber personal info?
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
"Okay, but why not just subscribe directly from the publisher then"
1) Apple already has iPhone user's credit cards on iTunes, so it's easy as one click. Why go to the trouble of re-entering your credit card on an outside Website? Even try that on an iPhone? 2) Apple, unlike publishers and "What's Privacy?" Google, will stubbornly protect users' data and will not give it to publishers (who are fuming over it) unless subscribers affirmatively opt-in.
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
for stockholders like myself!
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
How much is 100M credit cards on file, one click away, worth? Should that be free? As a stockholder, I say no.
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
You know what? Fuck Apple. Fuck Steve Jobs.
This greedy bastard already managed to raise the price of e-books across the board. I don't own shit by Apple, but if I am going to buy books, I will pay more because of Apple.
Now they want to charge a piece of everything that touches of their shitPhones. Just like MS did with PCs.
Just like MS, this will raise prices across the board. Whether one uses Apple or not, everyone will pay more.
"At this point, though, it's a pure money grab."
"There is only IBM and ITT, and AT&T...and now Apple."
http://www.youtube.com/watch?v=zI5hrcwU7Dk
Apple doesn't "own the market." To be a monopolist, a company must control 60-70% of the relevant market. iOS isn't even in the 30's.
EU MMV.
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
Get out of your bubble, nerdy little retard, this isn't 1988. Walk into an Apple store sometime. The kids playing with iPads don't give a rat's ass about your silly open source religion. They like the devices, so they buy them, simple. And developers who want to get out of their moms' basements will sell out and take the 70%. And they will say thank you for the access to 100M credit cards, Mr. Jobs!
Fucking open source nerds must die.
Love,
AAPL Stockholders.
Err... how does this screw over authors?
As you said, all publishers have to do is go straight to Apple and ignore Amazon as the middleman, they still get 70%.
I don't see a problem really, it's not as if publishers can't sell to both Amazon and Apple. They sell to B&N and Amazon at the same time with no problems.
Dumbfuck, iPods never had to chase prices, and neither does the iPhone. Not everyone wants the cheapest piece of crap. Quite the contrary, most people want the best.
"you forgot one: price. that shoe has yet to drop, but when it drops and all those Android manufacturers start drop their prices to compete against each other that is going to force Apple to either compete on price, or be relegate to being a bit player. And we've seen this movie before so we know it won't be the former."
Apple buys flash and screens in such enormous amounts (in the billions at a time), they can dictate their price and everyone else is left scrambling for parts and can't compete with the iPad on price and actually make money. And how did competitors do against the iPod making cheap knock-offs the last 10 years?
Wishing doesn't make it true.
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
About making money for shareholders? You know, Apple's legal duty?
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
Especially when Apple has 130 million credit cards on file, one click away? Why should publishers get this for free? As an Apple stockholder, I say, "charge those freeloaders rent!"
Is everyone here a freaking socialist?
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
3) Not participating in Apple's one-click 130 million credit card database.
That's a privilege you have to pay for, my friend.
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
WTF is "rent seeking behavior?" What an incredibly stupid comment, you stupid fuck. Do you know Apple is a publicly held corporation? And that it has duties to its stockholders to maximize profits? And that 100 million credit cards on file is worth a fortune? Should Apple just give away one-click access to 100 million credit cards that are one click away and say "fark the stockholders, this nerd on Slashdot doesn't like it."?
Who fucking cares what you would rather Apple do? As a stockholder, I say, go fark yourself and go back to your coding cubicle.
Do you have any idea how dumb you sound? Apple has 130 million credit cards on file. Yes, you need to PAY RENT for the privilege of having access to being one click away from 130 million freaking credit cards! Why on earth should Apple give that away for free? Do you even know what a publicly held corporation is? Don't you own any stock, directly or through funds?
and the US government does nothing as Apple is one of the few remaining US-based consumer tech companies (though I suspect Steve has made plenty of threats to move house in order to get his way).
Because they have to pay someone else for those bits. If the cost to them is 5USD and they sell for 6USD, then giving Apple 30% means they lose 0.8USD on every sale.
As they're not allowed to charge more for in-app sales than normal ones, they either eat the loss or raise prices across the board (and consequently lose sales to cheaper competitors who choose not to deal with Apple).
And yes, obviously those numbers are pulled out of my arse, but they illustrate the answer to your question.
It's official. Most of you are morons.
And the rules apply from June. Your point is?
If you were following the thread, the claim was, "Apple already made the same changes to their InApp Purchases requirements with the same 30% cut to Apple if purchased via the InApp Purchase, and that they have to offer the same price via their own website and through the Apple Store."
As of yesterday, that is false. None of the reports I've seen and nothing I've found on Apple's web sites indicate that the new rules are being delayed until June (perhaps you can point out where Apple announced this?), but in any case, the new rule is limited to subscriptions and new customers. So it looks like the claim that Apple is trying to grab a share of Amazon's book/Kindle sales is also untrue.
http://apple.slashdot.org/story/11/02/02/179215/Apple-eBook-Rules-Changing-For-Sellers
The changes for eBooks were discussed here on Slashdot exactly two weeks ago. They're not in effect yet, but they're the same rules and percentages as the new Subscription model.
On Android there's Google Books, Kindle, Nook for Android, Sony Reader (the one denied by Apple), and plenty of others.
-]Phreak Out[-
You might find a large range of terms that the adults in this conversation have been using that you have so far, failed to understand.
As a magazine and book publisher we spent about 120% of our subscription revenue on production and mailing of the magazine. It was the advertising that saved us. If I could have cut that 120% to a mere 30% I would have been over joyed.
I think you're stating something as fact when it's only speculation.
I keep on seeing claims without evidence that this effects kindle books purchased outside of the app but as far as I can see, it only effects paid digital subs where you are required to also offer in app subs if you use the app to drive traffic to digital subs. If you offer free digital subs to supplement dead tree ones then it does not effect your app. It also does not appear to effect the Kindle app either since they do not offer access to subscriptions in any Kindle apps. The Amazon subs only seem to work with the Kindle hardware.
Please prove me wrong but citation other than another slashdot article is needed.
Jesus was a compassionate social conservative who called individuals to sin no more.
http://lmgtfy.com/?q=apple+subscription+rules+June&l=1
I asked you to point out where Apple announced this. Needless to say, an article on a rumor site (and quoting a non-Apple source) does not qualify as an Apple announcement.
Dumb assumption #1: Most companies do not have to "pass on savings" (I think you mean extra expense) for sales that would have never happened in the first place. It might hurt Amazon's margins (fuck them - as a book seller, I can tell you that they rape third party sellers with a similar commission to Apple's), but certainly not digital publishers.
Dumb assumption #2: That Apple users are hipsters. 1999 called and wants your dumb statement back. Apple is no longer a niche product maker. They've sold 100's of millions of devices. I guess half the country are now "hipsters?" WTH is a hipster anyway, nerdster?
Dumb assumption #3: That a stockholder defending Apple taking a cut is an Apple product user. Other than a recent iPhone I got as a gift, I am not.
So keep on keepin' on being dumb!
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
I don't get it... What's the big deal?
So if you don't want to pay a 30% Apple tax, don't let people subscribe to your content in the App. Force them to go online to do it.
Or am i missing something?
Over the years I have bought a slew of laptops and notebooks, TI, Gateway, Toshiba, Sony, Apple... Without exception the Apple equipment lasted longer physically and stayed viable performance wise than other competing brands I tried. And it wasn't that I was buying cheap non-apple gear. The toshiba notebooks were all near the top of the line when I bought them, but each one soon displayed too much personality, and became troublesome. Each with so many software and firmware updates, it is near impossible to keep them straight. And so much junkware. The last toshiba I bought was a 17" hi-def multimedia enhanced Wonder-machine, except that after a short period of time, it would overheat and suddenly shut itself down unexpectedly. Not very healthy for data or OS. The Sony VAIO laptops I bought, don't get me started about the Vista Capable fiasco turned out to be junk. I bought the most expensive VAIO in the line at the time, fingerprint scanner and all. I am on my third battery. Keys constantly fall off the keyboard, The internal wi-fi is non-standard and flakey. and now it works fine, if you keep it plugged in, use an external keyboard, mouse, and display. The Apple hardware on the other hand, has faired better. Even the iMac 17" flat panel 1GHz PPC still runs leopard well enough to do mail, browse the web, and use iWork. That machine is now 7 years old, an working fine. I assure you I don't have any PC's that old that are worth plugging in. I have had a few problems with the hardware, and Apple promptly took care of the few things that have happened over the years. Apple's success is about choosing what to build, and supporting it well. They don't try to run every version of every operating system in the world, because there is no way to do QA for that. While brilliant in some respects because it allowed a healthy third party hardware add-in market, IBM opened a serious can of worms with the clone architecture, and even in the early days, it was hard to test all the configurations. but then a plethora of video cards, and audio cards, and motherboard hardware made PC tech support terribly painful. Plug and pray didn't help that much, and only PCI saved the architecture at all. The contemporary personal computer marketplace has enough choice for anyone, and we all have our favorites. I will continue to buy Apple and expect I will continue to have the same satisfaction level I have had for the last 7 years. Ever since Mac OS X, apple machines have been wonderful for me. But that's me. IMHO