Amazon Turns Off In-App Purchases In iOS Comixology

whisper_jeff writes: "Under the bold assumption that, since they were able to do it with books, they must be able to do it with comics, Amazon has decided to avoid Apple's 30% cut of in app purchases by removing the option from digital comic book platform Comixology for iOS users. It will be interesting to see if digital comic readers leap through the extra hoops to read digital comics on their iOS device or if Amazon has just signed the death knell for their new purchase. Readers may decide that buying a book and buying a comic aren't the same thing — that the extra hoops they're being forced to leap through simply aren't worth it for a comic that takes five minutes to read."

Comments

As a big comixology user, this *sucks*

[dknight]

Honestly, one of the great things about comixology was being able to quickly buy/download the next comic in the series when I was binge-reading. I have *hundreds* of comics through them, but I'm not sure if I will be buying any more with this new system. The kindle thing was enough of a pain, but at least a book takes a little longer to read.

I think they've shot themselves in teh foot on this one.

Re:As a big comixology user, this *sucks*

[Richy_T]

It's not just taking a poke at apple. Apples fees are egregiously high. Smaller operators may just be forced to suck it up but Amazon is in the position of making a more tactical decision. Not only do they have their own device(s) but Apple is not exactly without other competitors. I guess they feel they're in a position where they can see how it plays out.

Re:As a big comixology user, this *sucks*

[tlhIngan]

Honestly, one of the great things about comixology was being able to quickly buy/download the next comic in the series when I was binge-reading. I have *hundreds* of comics through them, but I'm not sure if I will be buying any more with this new system. The kindle thing was enough of a pain, but at least a book takes a little longer to read.

I think they've shot themselves in teh foot on this one.

And you know what? Comixology knew that, that's why they sucked it up and gave Apple the 30% (though to be honest, the wholesale price Comixology paid meant they still made a profit - even raw comic books that sell for $4 probably cost the store $2 or less). Because by making the user jump through hoops to buy it to get that extra 30% means they'll lose the impulse-buy. And impulse-buy is big - for every person willing to jump through a hoop, 10-20 would just do one-click purchasing (just ask Amazon - if One-Click didn't work, why bother suing B&N over it?), making that 30% easily justifiable.

And no, Amazon won't sell it online any cheaper - they can't. Diamond Comics (the SOLE comic distributor for practically ALL comics worldwide) has a virtual monopoly on it, and they view any reseller that undercuts others (comic stores) very dimly. The only time it doesn't matter is when the items are available through other channels (e.g., most books). But comics are Diamond's property and someone who undercuts may find their orders shorted, especially on items that are often allocated.

Re:As a big comixology user, this *sucks*

[wonkey_monkey]

So, you love the service but not enough just to go to a web site and buy it for 30% (or so) less than you have been paying now?

That's a rather optimistic assumption.

Re:Are they allowed to do that?

[whisper_jeff]

In app purchases pay a 30% fee to Apple to payment processing, etc. Purchases made outside the app (ie: at a developer's website such as amazon.com) do not incur the 30% fee.

It's up to each developer to decide if the 30% fee is worth the ease of use and Apple handling all the payment processing or not. The vast, vast, vast majority of developers happily pay that fee. Amazon is the one high profile developer to buck that trend, first with Kindle and now with Comixology.

You can sell externally, can't provide link in-app

[SuperKendall]

I thought that any bolt-ons for apps had to be sold through the Apple Store so they could collect their 30% cut.

You can sell things externally to unlock features - for instance there are many applications for websites that require a paid subscription to work.

What you can't do is provide a link in the app that takes you directly to a purchasing page to work wrounf the in-app thing.

Honestly tough, I've always thought it was a pretty fair trade-off to pay 30% to gan access to many millions of people who already have payment details entered and ready to go at the press of a button.

I'm pretty sure Comixology will lose far more in sales than they would gain by not giving away 30%, I've bought a number of things in the app but if I can't I simply will not bother to figure out how I can get them.

I do think it's a precursor to Amazon folding Comixology into the Kindle application, then it would be easier for people to make use of to buy comics as they already do books for the Kindle app. In that case I don't think they will lose many sales (though that's long term and I've not heard they plan to do so yet).

30% is such a nice cut

[postmortem]

If you're mafia, or Apple.

Re:30% is such a nice cut

[Gavagai80]

And virtually everyone else that offers payment processing services

Only in mobile app walled gardens. PayPal, 2checkout, authorize.net etc only take about 3%.

Sad to say it, but Go Amazon.

[Anonymous Coward]

Anything that keeps down Apple's extortion, even a bit, is a win in my book. And you can tell that Amazon is doing this _explicitly_ to keep the unearned profits out of Apple's pockets rather than to optimize their own revenue. If all they were concerned about was their bottom line they would offer the in-app purchases at an additional mark-up that covers Apple's 30% and let any customers who value that convenience over the extra cost have at it, while still offering external purchases at current prices. Amazon is by no means a saint either, but a little healthy sibling rivalry and competition can often (though not always) benefit consumers in the long run.

Re:Are they allowed to do that?

[alvinrod]

It probably makes sense for Amazon to do it though considering they have their own infrastructure for handling payments and their own huge customer base. They don't own the content that's being sold either, so I imagine that Apple's 30% cut eats into potential profits by a large amount.

Re:Erh... wouldn't it be smarter....

[whisper_jeff]

Not allowed. If an in app purchase is offered and the same purchase is available on an external source, the price of the in app purchase cannot be higher.

Re:You mean, such a low cut...

[GryMor]

30% wholesale is 23% of retail, apple is taking 30% of retail (42% of wholesale if they were the store), AND THEY AREN'T EVEN THE STORE.

Re:Are they allowed to do that?

[Dahamma]

I know for video that's pretty much the entire profit margin. Apple basically doesn't want any competition to iTunes so they have priced out TVOD/music competitors completely.