Print 14 comment(s) - last by lawrance.. on Feb 17 at 6:55 PM

Apple is finally preparing to roll out it solution for streamlined subscriptions to periodicals.  (Source: SFN Blog)
Apple delivers yet another way for its developer community to monetize their work

One of the key reasons why Apple still retains a lead when it comes to apps (there's currently 350,000 iOS apps) -- despite having been passed by Android in market share -- is that it offers industry-leading monetization for its developers.  From direct sales to in-app purchases and ad-driven apps, Apple offers developers a number of ways to make the almighty dollar.

Now it's giving them one more.

Today Apple announced [press release] that it would be giving developers access to in-app subscriptions.  The move is designed to placate disgruntled magazine and newspaper companies, who were upset by Apple's enforcement of a prohibition on external storefronts (Apple requires those who submit apps to conduct all business that flows through the app within Apple's ecosystem.

Now periodical publishers can let Apple do the dirty work for a small cut.   Apple CEO Steve Jobs, who is currently on medical leave, but actively involved with the company's day-to-day operations, states:

Our philosophy is simple — when Apple brings a new subscriber to the app, Apple earns a 30 percent share; when the publisher brings an existing or new subscriber to the app, the publisher keeps 100 percent and Apple earns nothing. 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. We believe that this innovative subscription service will provide publishers with a brand new opportunity to expand digital access to their content onto the iPad, iPod touch and iPhone, delighting both new and existing subscribers.

The tricky part will be that Apple is allowing developers to offer subscriptions on their own portals outside their iPhone app.  Users who sign up in this fashion for services will have to go through a separate in-app authentication process.  But businesses that sign up users in this fashion will not have to pay service fees.

Developers are still banned from putting links to their off-site purchase portal in their app.  They're also required to provide an in-app subscription option for any off-app subscription options they've made available.

Interestingly publishers are allowed to ask for additional personal information as long as they make it clear that the user will be adhering to the publisher’s privacy policy and not Apple's.  Apple says that protecting privacy is a key to the success of subscription-based apps.

So to recap for developers:

  1. You can not put links to external portals that sell subscription services.
  2. You can allow purchases on a non-linked external portal to allow users to access in-app subscription content.  The responsibility for authentication rests on developers, not Apple.
  3. You must allow an equivalent in-app subscription option to what is on the portal.
  4. You may ask for additional personal data when taking subscriptions, but you have to clarify that it's you who wants it and not Apple.
The policy seems pretty straightforward -- it's unlikely to keep everyone happy, but it seems like a decent compromise.

Apple has not made it clear how the new subscription features will be rolled out, but they'll likely be including in the upcoming release of iOS 4.3.


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By Alexstarfire on 2/15/2011 1:47:35 PM , Rating: 2
Seems like rule 3 is designed to put Apple in control. Since the offers are equal there isn't a reason for consumers to go outside the app to get the product. This won't affect end-user consumers directly, but could indirectly. Obviously Apple just wants a cut and forcing them to have equal offers will do that since the only ones going outside the app to get it will likely be those who already have/had it. In the end producers/companies might just forget about their own implementation since it doesn't make much sense to have both of them running. If that happens they might increase the price to make up some of the lost profit.

Though, after writing this I realize that it might largely depend on how in-app subscriptions can function. If the in-app subscription gives you access to things outside the app, even though they can't post links directly, then I could see them keeping their own implementation running. Wouldn't make sense for them to force people to get an iPhone just so they could pay for a subscription to view the website on their desktop after all.

RE: Rules...
By Moishe on 2/15/2011 2:28:43 PM , Rating: 5
I think the purpose of #3 is to prevent the content owner from pricing it higher on Apple's platform and essentially preferring their own platform over Apple's.

It's a double-edged sword.

If it saves you 30% to NOT go with Apple then you have that much more to build your own subscription platform.


Then you don't get Apple's customer base and you don't satisfy your own customers that want to view your content on the Apple device.

Personally, I think 30% is WAY too high for Apple to be wanting. The customer pays for the device and connection. The content owner pays for creating the content and the platform to distribute it (iOS app and others)... Apple provides the app store. That's it. Essentially, Apple wants 30% for doing (almost) nothing. They profit from the device and they should profit from the store, but wanting a 30% cut is too high.

This is why I avoid Apple devices. They make nice stuff, but it costs more and they really do try to lock you into their ecosystem, far, FAR more than other companies (Microsoft for instance). I don't want to be tied down. I don't like artificial limits placed where they are not wanted or needed.

RE: Rules...
By Kiffberet on 2/16/11, Rating: 0
RE: Rules...
By InsaneScientist on 2/17/2011 5:14:11 AM , Rating: 2
If they have such insanely huge costs associated with developing iTunes, then would you care to explain why iTunes is still the worst steaming pile of garbage I've ever installed on my computer? (which I'm trying rather hard to free myself from)
I don't care what kind of features they've baked in... when I can open half of the Adobe CS5 master collection in the same time it takes my media player to open, they've done something VERY, VERY wrong.
And you're trying to convince me that they actually put money into the development of this thing? >_<

RE: Rules...
By Kiffberet on 2/16/2011 7:54:28 AM , Rating: 2
30% is more than fair I'd have thought.

Having the best idea/software in the world is all fine and dandy, but if you can't find anyone to buy it, then you're no better off. You could go to android and charge 30% less, and see if that increases your sales. Changes are it won't because people don't buy anything on Android...

That 30% isn't pure profit by the way. Apple have huge costs associated with developing and marketing itunes.

150,000 apps in Android Market, tripled in 9 months
By Gio6518 on 2/15/2011 6:56:27 PM , Rating: 2
As Eric Schmidt mentioned in his keynote address at Mobile World Congress, the Android Market now has over 150,000 applications. The number of apps has tripled over the past nine months, and grown by a full third since last fall. They're getting better as well -- I think we all have noticed applications of a much higher quality appearing, as well as cross platform apps and games from the bigger developers.

By Kiffberet on 2/16/2011 7:57:41 AM , Rating: 2
The problem is, no body buys anything on Android. They expect developers to build things out of the kindest of their hearts and everything to be free.

By cjohnson2136 on 2/16/2011 2:56:25 PM , Rating: 2
Also keep in mind that to develop for iOS it cost a developer 99 dollars a year. For Android it cost 25 dollars for a lifetime. So some developers will just make stuff cause its what they like to do and if you only have a cost of 25 dollars then not much lost. But if you are paying 99 for a year to want to recoup some of that loss

By InsaneScientist on 2/17/2011 5:17:25 AM , Rating: 2
Ehhh? I've spent more on the android market in the last few months than I did over the last two years on the iTunes store with my iPod touch...
And I can't even begin to count the number of people I know with android phones that want a PAID version of the Angry Birds app so they don't have to deal with the ads.

By dagamer34 on 2/15/2011 11:36:57 AM , Rating: 2
30% cut for every Kindle book sold. Amazon will not be happy.

RE: Hmm..
By Tony Swash on 2/15/2011 12:23:20 PM , Rating: 2
30% cut for every Kindle book sold. Amazon will not be happy.

The 30% is for stuff sold via an app in iOS on an Apple device. If you sell something independently (via a web link for example) even if it is consumed/viewed/stored on an i-device then you get 100% and Apple takes 0%.

RE: Hmm..
By zaxxon on 2/15/2011 12:57:13 PM , Rating: 2
sounds fair....

RE: Hmm..
By Tony Swash on 2/15/11, Rating: 0
By lawrance on 2/17/2011 6:55:44 PM , Rating: 2
Gee, I wonder how long it will take Google to once again copy Apple's new....


Less than 24 hours after Apple's announcement, Google has just announced it has copied Apple's In-App subscription with it's own "Google One Pass" subscription model.

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