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Apple: if we get you subscribers, we deserve a cut

36 pointsby baxterover 14 years ago

18 comments

nomurrcyover 14 years ago
Full disclosure: I generally like apple products and have used NeXT / apple products for a long time.<p>I don't see how Apple's stance here is defensible or honest. They using their position as a large platform provider to steal from 3rd party developers.<p>To me this is akin to me writing a program for OSX that allows users to sign up for a subscription service, and apple taking a 30% cut of my cash flows just because I targeted their platform. They have been paid for their device by the consumer, they don't own all the software running on the device. They provide an OS, 3rd party developers provide the applications.<p>Most iOS programs receive absolutely no advertising from apple. In these cases how has apple contributed anything - how as Apple brought them customers. What if I run an ad-words campaign and drive my own app sales? If Apple were to make deals with developers for cuts of cash flow in exchange for advertising on the store, that would seem more honest.<p>To me this seems anti competitive and just plain dishonest. Apple is at risk of becoming the troll under the bridge here.
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kalak451over 14 years ago
Hmmm....and if my app gets someone to buy your iPad, what do I get?
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nhangenover 14 years ago
As an indie developer, this excites me. Sure, I can understand how the big guys might see it differently, but now I don't have to build an entire distribution network should I decide I'd like to develop subscription based content.<p>I read many digital PDF's (like Hacker Monthly) and though I enjoy downloading and reading the PDF on my iMac, I would be delighted to pay 99 cents to have each issue delivered to my iPad on a monthly basis.<p>And as a developer, it's added value.
JoeAltmaierover 14 years ago
So arrogant - "We get you subscribers"!<p>How did they do that? They didn't create the ad, they didn't put it in the app, they did diddly-squat in fact. You (the app developer) did the work, take the risk, and now cannot even get paid properly - you have to essentially make iPhone your sole outlet, or charge 30% premium everywhere else.
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BigZaphodover 14 years ago
I'm a huge Apple fan, but I admit there's something about this which doesn't feel entirely... right, and that's concerning.<p>That said, however, there's decent and non-evil reasons for them to think like this - at least in terms of subscriptions, IMO.<p>One issue is that subscription-based apps are almost always free in the app store. Apple loses money on free apps that don't include iAds. If the subscription fee itself is also outside of Apple's control, they're hosting your app, getting you "shelf space", driving people to your app, etc. and they get nothing in return. With such an app, the content is basically replaced every month (or week or day or whatever) which makes the process a bit like a scheduled purchase of a new version of an app - hence the 30% cut.<p>On the surface, I disagree that Apple should get 30% forever for a subscription - especially if the publisher is providing all the infrastructure necessary to deliver that content. What if, though, the subscription system allowed publishers to upload the content once to Apple, and Apple hosts and distributes it to the apps and users? Now the 30% starts looking a bit more reasonable. If indeed it works this way (or will eventually work this way), you could be a very small shop and still manage to support thousands or, indeed, millions of subscriptions with virtually no support infrastructure of your own. That's <i>certainly</i> worth 30% IMO.<p>The flip side, though, is if you already have your own content delivery mechanisims in place, Apple taking 30% each billing cycle seems unfair. IMO, they should offer the subscription products in two flavors - one where they host and distribute your content, and another where you are doing that work. In the second version, Apple could easily take 30% of, say, the first billing cycle and take diminishing amounts for as long as the subscription remains in effect - perhaps even going all the way down to something like 2% just to cover the payment processing. That would seem a lot more fair to me than taking 30% forever.<p>Sadly, though, I haven't yet seen anything that suggests that either of these situations are even true. For all I know, Apple might not be offering any distribution or hosting services and might not even have an API to allow apps to easily take delivery of subscription content, and if that's the case, taking 30% forever seems excessive.
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c2over 14 years ago
The flip side of course is that these apps make the iPhone/iPad more appealing to more people. I can see Apple shooting themselves in the foot with their predatory practices against app publishers. Losing a big chunk of your margin while developing apps for free for Apple's products is only going to be sustainable for so long. And more likely then not, it will drive away the big players first where each percent means more.
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sethgover 14 years ago
Apple is trying to prevent the following maneuver:<p>¶ FooPub Inc. publishes FooMag through the App Store, at a price of $1/year.<p>¶ Each issue of FooMag contains some small amount of content and a link: “To read more, go to foopub.example.com and subscribe to FooMag Deluxe for $20/year!”<p>¶ Users download FooMag Deluxe through FooPub’s own servers, bypassing the App Store completely.<p>¶ Scads of people discover FooMag through the App Store, subscribe to it (giving Apple 30¢ out of each $1 subscription), and a significant fraction of them upgrade to the deluxe version (giving Apple nothing).
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galuggusover 14 years ago
the only company that will kill apple is apple
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kbutlerover 14 years ago
In related news, the US Interstate Highway system will now require a 30% cut of the purchase price of every vehicle purchased in the United States. "Our philosophy is simple—when US Highways bring a new driver to the car company, US Highways earn a 30 percent share."<p>The US Postal Service considered a similar regulation, but found that customers would simply divert shipments to competitors UPS, DHL, and Fedex, and is instead filing suit against those companies for unfair trade practices, and lobbying congress for a retroactive grant of a business method patent on package delivery with corresponding extension of patent duration to life of the organization plus 70 years.<p>kb
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waterlesscloudover 14 years ago
By this logic, the customer's ISP also deserves a cut.
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jscoreover 14 years ago
(Disclaimer: I don't work for Apple or own any of their stock, just a happy dev in their ecosystem)<p>I completely agree with this model.<p>Apple's marketing muscle is HUGE. I'm perfectly OK with splitting one-time or recurring revenue with them if they help bring me customers.
ezyover 14 years ago
Obviously, any app store-only app will not care about this other than reduced margins for subscriptions -- they weren't making money any other way. But folks who sell through other channels than ipad will .. just leave. I wonder if that's the goal.<p>But then again: it's like the ebook purchase thing -- Amazon and BN have been strangely silent -- maybe they decided to relent, maybe they're going to get a special deal, or maybe they'll pull their apps just before the ipad2 launches. :-)
pixdamixover 14 years ago
<i>"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."</i><p><i>"Apple's announcement went on to emphasize that publishers are not limited to using the App Store for subscriptions; they're allowed to use their own websites to sell subs."</i><p>So purchase can be made in Safari in order to bypass the AppleVAT ?
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brisanceover 14 years ago
I think this whole thing is overblown.<p>When I trade stock, options or pretty much anything, I get charged commissions. So by the same reckoning e*trade, Schwab, Ameritrade, &#60;insert brokerage here&#62; are thieves and have been "stealing" from investors/traders for centuries.
christo16over 14 years ago
It's more than just providing a subscriber base, it's the infastructure to process recurring payments, while making it stupid simple for the customer. Whether this is worth 30% is debatable, as some of us know it's not trivial/cheap to do on your own.
trotskyover 14 years ago
Does the upcoming launch of Apple's NFC system and general purpose payments platform suggest that the same rules will be coming for ecommerce and general transactions? Sounds like bad news for people like Square or PayPal.
afortyover 14 years ago
Just based on that one line argument in the subject, I can't say I disagree.
alexobenauerover 14 years ago
To round the issue out from their side, not that I agree, from their point of view, it's "If we bring you subscribers via our devices, we deserve a cut"
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