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.


“Then they pop up and say ‘Hello, surprise! Give us your money or we will shut you down!' Screw them. Seriously, screw them. You can quote me on that.” -- Newegg Chief Legal Officer Lee Cheng referencing patent trolls

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