NYT: Apple Moves to Tighten Control of App Store

[Crowl]

Originally Posted by leebase

I don't even like, personally, every one of Apple's policies. But I like that Apple has been very successful in getting support for the iPad. And Apple's content providers are very happy that Apple has attracted customers like me who are willing to actually pay for some of our content.

They were successful in attracting support from companies like Amazon that has greatly enhanced the overall attractiveness of the ipad, those companies are not going to hang around and continue to make the ipad look good if they make no money and for anyone that isn't a mindless isheep willing to accept only the likes itunes or ibooks to provide them with content that is a bad thing.

If apple wanted to demand that there was a minimum charge for service-related apps or wanted to charge those companies money for hosting a free app based on the amount of times people actually downloaded it then that would be more than fair since beyond supplying the hardware for sale (and they have obviously got their cut there) that is all they are actually doing for a lot of them and in any case that is also apple's choice due to them blocking other options for installing apps.

[Horemheb]

Every conscious customer should be worried about this Apple initiative because clearly there is only one possible player who will pay for Apple's greed: the customers.

The main problem here is that Apple suddenly wants a slice from the pie of e-publishing and from the pie with which Apple has absolutley nothing to do at that.

Apple wants money for something it provides NOTHING in turn. E.g. as far as Amazon or B&N books Apple adds nothing to the story. There were some claims previously in this topic that Apple does provide some kind of service for which it deservers some money.

Well, here is a scenario which reveals that Apple indeed provides absolutely nothing for the money it claims.

Jack and Jill have identical content consuming habits, especially for e-books.

- In the morning they both read on their PC.
- In the afternoon they both read on their phone.
- In the evening they both read on their e-reader.
- They purchase e-books immeditely as the idea comes into their mind, and they purchase the e-book on the same platform they are reading on at the moment.

The only difference is that Jack has iPhone and Jill has Android.

The cost of Jill's reading is:
Cost = Author + Copyright owner + Publisher + Retailer

The cost of Jack's reading for books he purchases not in the afternoon:
Cost = Author + Copyright owner + Publisher + Retailer

The cost of Jack's reading for books he purchases in the afternoon:
Cost = Author + Copyright owner + Publisher + Retailer + Apple

Who would pay for the extra cost in the last example? Of course the customers! Only infinitely naive people would think otherwise.

If really there is value added by Apple (thus justifying the extra cost) then it is easy to answer the following questions:

1. How is it any better for Jack than for Jill?
2. How is it any better for Jack to read in the evening on his e-reader the e-book he purchased in the afternoon than to read in the evening on his e-reader the e-book he purchased in the morning?
3. How is it any better for Jack to read on his PC the e-book he purchased in the afternoon than the e-book he purchased in the evening?

[Andrew H.]

Originally Posted by Horemheb

Every conscious customer should be worried about this Apple initiative because clearly there is only one possible player who will pay for Apple's greed: the customers.

No, the authors could end up paying, too.

[Graham]

Originally Posted by Horemheb

The cost of Jack's reading for books he purchases in the afternoon:
Cost = Author + Copyright owner + Publisher + Retailer + Apple

Who would pay for the extra cost in the last example? Of course the customers! Only infinitely naive people would think otherwise.

Except that Apple's rules state that the price cannot be lower outside the app, so Jack's cost of reading would be the same as or lower than Jill's. It is possible, yes, that all prices would rise to cover this.

However, the rules only definitely apply to subscriptions, not individual books, and in the case of subs Apple definitely are providing a service (purchase, renewal, support, refunds) not "nothing in return". Worth 30%? I think not. Worth something? Yes; Google thinks 10%.

Graham

[snipenekkid]

Originally Posted by Maggie Leung

Android's momentum and range of devices give consumers more options than ever. It'll be interesting to see how Apple will balance not alienating consumers, app developers and vendors as it tries to maximize profits. Even successful companies can overreach.

Mobile devices have become user-friendlier over the years, which also weighs against Apple. The fact that someone as tech-limited as I am is willing to switch to Android doesn't work in Apple's favor, for instance.

Apple's key strength has been creating user-friendly access to content. The company is risking undermining that key feature with this current course. If I were a content provider, I might go along with Apple in the short term, to avoid losing market share, but I would be developing Web access so I could abandon Apple as quickly as possible, while holding onto my content buyers longer term. Even if content providers go along for now, they've gotta be wondering what happens the next time Apple decides to put the screws to them.

Apple has created a chilling effect with its current course -- among informed consumers, as well as content providers and app developers. That does not seem like a good long-term business strategy when Android is waiting to eat your lunch. Apple might gain short term, but short-term strategizing can bite. For one thing, it's much cheaper to keep existing customers than it is to attract new ones. And it will be harder to attract new ones if you've made content providers, vendors and app developers skittish.

very solid posts Maggie. Does the bolded part bring to mind any OS from the past going head to head with Apple and Apple doing essentially the same thing as they are doing now "...do it our [the Apple] way or you can't run on our hardware." Guess which OS won that competition? MS and MS-DOS & Windows of course. Now it's just Google in the place of MS with the with a company already experienced and a HUGE foothold in the business market which is, gee, just like 25-30 years ago. So while MS might be in decline vision wise, there still may be a bright young mind out ther, heck for all we know Google could cough up the cash to do what was unthinkable just 5-6 years ago and BUY MICROSOFT to move in a serious way into the office place overnight. I good example only on a very small scale was HP-Compaq's purchase of Palm. HP knew the hole left in the market, when Palm pretty much went teats-up and Sony dropped out of the PDA market, was never filled yet there is a huge demand for just those devices only updated to modern needs.

If Apple keeps on this path of basically trying to control everything and force compliance from developers (akin to herding cats even in the boom years) it's just going to fall flat when there exists a way to develop for pretty much any hardware platform running the Android OS. And if they ever get apps that can work in harmony with MS OS based business apps, the companies which move in that direction and just drop Apple as they did those 25-30 years ago because of the PITA anal Apple restrictions and limitations, but those companies will be the real winners in this exploding market.

I just don't see any developers writing apps for my industry for OSX or iOS. Still I saw some very nice small utility apps I used on my Touch which i found just great. problem is the aid in productivity those iOS apps offered for me don't translate into increasing the efficiency in doing my day-to-day work. But I do see the potential for and Android + Windows synergy. Sadly, because, as I have stated over and over, I actually LOVED the newest 4th gen Touch. With just a bit larger screen, maybe a 5" 16:10 screen and the ability to add a 3G/4G data only, SIM card would make it the perfect hardware and form factor for my needs.

I guess I just agree with your take on the issue. Give me a device that does what I need, gets out of my way when I need to add more functionality outside your ecosystem and does not make me worry about me placing my trust in a very, well, for lack of a less inflammatory word, fickle company and platform. I need to know it will still be there letting me do what I need to do 10-yrs from now as it's a big investment of time and resources. Right after I find I really enjoyed using the iOS on the Touch, Apple pulls a stunt to make me leery of putting my trust in them, almost the same as back in the late 80s to early 90s when the lost for basically the same reasons to MS.

[Piper_]

Originally Posted by Graham

I've realised that even if this does only mean subscriptions - as I think is likely - it still gives Amazon a problem with selling content.

From the press release:



Now, Amazon does sell digital subscriptions via their website, and that content can be read in the app. Therefore by these rules they would have to a) offer Apple's service within their app for those subscriptions, and b) remove the links to the web store from the app.

So even if the rules don't apply to content, they are worded in such a way that they would break the way Amazon sells content.

It seems to say that if Amazon are in the magazine subscription business on the web, then they can't sell content via a link from an app on iOS.

Graham

Right now, my understanding from a developer is that the rules are - I think he meant always have been - that Apple takes 30% of any sale of any item or subscription made through the ap, whether you also sell subscriptions or not.

The new rules add that in-ap links to purchase from the seller's store are forbidden, and a link to purchase through the Apple ap is required.

So Apple will get the 30% on any purchase or subscription, unless the user knows to avoid using the link in the ap.

Who knows what the result will be after all the negotiations and other response, though. I expect/hope it'll be amended, or we'll see a quicker move from use of dedicated Apple aps to browser-based aps.

I'd sure like to be a fly on the wall in the negotiations room.

[RockdaMan]

Originally Posted by Crowl

Should microsoft, google etc. expect a cut of all sales made via web browsers since they are supplying as much as apple does if you ignore the payment processing that most companies do not want to be forced to use?

If their ecosystem was the same as Apples, yes. But it is not.

[RockdaMan]

Originally Posted by Graham

Apple's rules state that the price cannot be lower outside the app

No, Apple has said that the in app price has to be the same as the out of the app price.

No, wait...they said the prices have to be equal. Thats it.

[RockdaMan]

Originally Posted by Graham

Worth 30%? I think not. Worth something? Yes; Google thinks 10%.

Graham

Lets leave the market to decide. What is the problem with that?

[tomsem]

Originally Posted by Graham

Now, Amazon does sell digital subscriptions via their website, and that content can be read in the app. Therefore by these rules they would have to a) offer Apple's service within their app for those subscriptions, and b) remove the links to the web store from the app.

Actually I don't think Amazon allows subscriptions to be sent to the iOS apps (not even sure you can send any subscription to any app just yet, though this capability was announced, and it will be up to the publisher whether it is allowed). In any case, Amazon could just stop doing that if it was a problem.

[Horemheb]

Originally Posted by Andrew H.

No, the authors could end up paying, too.

You are right. This is ironic: the whole publishing business exists only because there are authors and customers - readers would like to read authors' writings. Yet these players should pay for Apple's greed. I still think however that it is almost guaranteed that the customers will pay for the whole extra cost or at least for the vast majority of it.

[Horemheb]

Originally Posted by Graham

Except that Apple's rules state that the price cannot be lower outside the app, so Jack's cost of reading would be the same as or lower than Jill's. It is possible, yes, that all prices would rise to cover this.

It is more than possible, it is almost guaranteed that exactly this is how it will be covered. All prices go up.

However, the rules only definitely apply to subscriptions, not individual books,

It applies to everything. There are subs of course where Apple is the retailer (thus entitled for a cut) but this is a minority in the sea of content (e.g. Amazon and B&N books). Apple wants money for nothing from all other content.

[RockdaMan]

Originally Posted by Horemheb

these players should pay for Apple's greed.

They are free to sell them outside the normal markets. Indie authors are growing in popularity these days. If they've signed a contract that prohibits them from doing that...well they decided to sign that contract.

[Horemheb]

Originally Posted by RockdaMan

They are free to sell them outside the normal markets. Indie authors are growing in popularity these days. If they've signed a contract that prohibits them from doing that...well they decided to sign that contract.

The author signs the contract with one of the big six and you (and all other customers) will pay for the extra cost of Apple's greed. If you don't read at all then of course it is not an issue. Otherwise it should be.

[Graham]

Originally Posted by RockdaMan

No, Apple has said that the in app price has to be the same as the out of the app price.

No, wait...they said the prices have to be equal. Thats it.

From the press release:

However, Apple does require that if a publisher chooses to sell a digital subscription separately outside of the app, that same subscription offer must be made available, at the same price or less, to customers who wish to subscribe from within the app

Graham