Amazon, B&N, Kobo: iOS aps to be pulled in June

[HansTWN]

If a user buys through Apple's itunes system, Apple obviously deserves a cut. But why should Apple deserve a cut when Amazon sells through other channels? Did Apple create the Kindle app? Apple is not giving iphones and ipads away for free -- they are selling them. When Amazon created the Kindle app it actually added great value to Apple devices -- it definitely is not a win-win for both. Apple has no right to control what people do with their devices. But they are trying. And 30% off the top is a great deal for app makers (Apple actually created a market for them), but it is outrageously greedy and unreasonable for books.

Prospective Apple buyers must vote with their pens (write and complain) or their feet (buy something else) to stop this.

And concerted action by Amazon, Sony, Kobo, etc makes a lot of sense. They should all pull their apps and actively promote other tablets. If they don't the results would be tragic for all ebook buyers --- an almost 50% increase in ebook prices! Anyway, if the Amazon and others do pull out I am sure the loss would be entirely Apple's. Avid readers would walk away from Apple and in any case, while the number of books read on Apple devices may not be small (though still a rather small slice of the overall ebook market), most of those were still bought at other stores.

[stonetools]

What will happen is that the agency model contracts will be renegotiated-something that happens frequently in business. Instead of the division being publisher 70/Amazon 30 , the split will end up something like publisher 60/Amazon20/Apple 20 . Remember, Amazon used to take 70 to publishers 30 prior to last year. That's what the negotiations will be about- a readjustment of who gets what percentage.
I must say, I'm rather touched by your solicitude for Amazon-a big company with an army of lawyers at their command. Trust me, the publishers and the booksellers will take care of themselves.

[snipenekkid]

Amazon needs to release their own color Android Slate device the day after the iPad 2 announcement with the added kicker that Apple kicked the K4iOS to the curb unless Apple is paid it's tithe.

FYI, I predicted earlier that this 30% cut thing was more than about books. Last night I received my email that now with my Amazon Prime membership there are free video streaming content from Amazon. I predicted Apple was and still is actively looking to be compensated if the consumer decided to tell the iTunes store to go procreate with itself in favor of other solutions. And I still contend the true reason there is no Flash for iOS has zero to do with stability or resources it's about content control and Apple is treating the iOS devices like the box from your cable company. If you want to use it for anything remotely useful then Apple demands payment via forced compliance.

I suspect the next assault will be on the jail-breaking developers out there. Apple has completed their journey to the Darkside with this total assault on the consumer. And has been pointed out multiple times in this thread, these are the same behaviors which almost killed Apple off way back when even installing a non-Apple approved program voided the warranty.

It's all just enough for me...seriously between the war on ebooks by the publishers themselves and Apple's war on, well, the globe, I really don't care anymore. If a Windows based slate comes out and works properly I'll buy one otherwise I am totally done with all of it.

[HansTWN]

Originally Posted by stonetools

What will happen is that the agency model contracts will be renegotiated-something that happens frequently in business. Instead of the division being publisher 70/Amazon 30 , the split will end up something like publisher 60/Amazon20/Apple 20 . Remember, Amazon used to take 70 to publishers 30 prior to last year. That's what the negotiations will be about- a readjustment of who gets what percentage.
I must say, I'm rather touched by your solicitude for Amazon-a big company with an army of lawyers at their command. Trust me, the publishers and the booksellers will take care of themselves.

In this case they will also take care off Apple buyers (not me, they scared me off for good over a year ago already) and ebook buyers in general in the fight against Apple. Not the lawyers -- this is a matter for the market and not for lawyers. And I don't see an 80-20 split for books either, for magazines, perhaps.

Actually, this rather smells like another attempt by the Apple/big 5 publisher gang to reduce Amazon's influence and push the ibook store.

Yes, the book sellers will take care of themselves --- and Apple can decide if they still want ebook readers to buy their devices or not. My guess is that Apple will back off and quietly negotiate a 2-5% fee. Big Steve will come out and say "this has been a big misunderstanding", wipe the egg off his face, and quietly plan his next attack on Apple buyers.

[OverTwo]

Why people like Apple products is beyond me.

[Lemurion]

Originally Posted by OverTwo

Why people like Apple products is beyond me.

I have a Mac, and I like it because it does what I want it to do easily and with less fuss than either of my Windows boxes. Apple makes good computers.

As for the current iOS app purchase mess - my own stance is simple: the primary reason I would have for buying an iOS device would be to consume content I already own.

The more roadblocks Apple puts in the way of my using the device to meet my needs, the less likely I am to buy in to their devices or ecosystem.

They have every right to do what they want, and I have every right not to buy into a system that doesn't meet my needs.

[CleverClothe]

Originally Posted by stonetools

There’s not too much Apple love on this issue, is there? I think there are two issues here:

1. does Apple deserve a cut of the revenue from the sales of products on its platform
2. what should be the size of the cut.

I guess we need to repeat this once again.

Apple wants a cut of content NOT ON ITS STORE. It wants to do this by forcing all apps to sell through the app API. THAT is what people are really angry with.

[carld]

Originally Posted by snipenekkid

And I still contend the true reason there is no Flash for iOS has zero to do with stability or resources it's about content control and Apple is treating the iOS devices like the box from your cable company. If you want to use it for anything remotely useful then Apple demands payment via forced compliance.

Yes, we've been making that point from the word go with the iPad. I've even seen an Apple fan calling Flash "a cancer on the web." My eyes rolled right out of my head.

[ApK]

I know a lot of technologists who feel that way about Flash.

[Worldwalker]

Originally Posted by stonetools

Before I bought my Ipad in December, I had never purchased anything from Amazon or B&N. Since that time, I have bought nine or ten ebooks from them. Not a red cent has gone to Apple, despite the fact that the purchases were made through the Ipad, for use on the Ipad, by means of apps hosted by Apple.

A very red cent has gone to Apple, quite a few red cents in fact: the money that you paid to Apple to buy an iPad from them.

In the case of apps on Apple's servers, sure, they can charge for the use of their servers if they want. But just because a purchase is made through the iPad (you paid for the iPad, right? and you're paying for your airtime?) and for use on the iPad (I drive a Honda, but Honda doesn't get a cut of what I spend on gas and car washes) doesn't give Apple any stake in it.

The manufacturer of my computer (well, that would be me, so I guess the manufacturers of the various components) don't get payments from Amazon whenever I buy a book there. I ordered some shampoo this afternoon, but the Vermont Country Store has no obligation to give any percentage of my payment to Microsoft, even though the computer uses their OS, nor to the Mozilla Foundation, despite the order being submitted through Firefox. Why should an iPad be any different? When I buy books from Baen to put on my Sony 505, Baen doesn't send Sony a check. You can check with Tim Myers, but I don't think he's had to shell out to Sony, either, despite how many of his books I've bought through Smashwords.

Frankly, anyone who thinks that the manufacturer of a platform is entitled to a cut of all business transacted on that platform should really take a good, close look at themselves and question whether they're being objective here. It doesn't happen with other things. Sandisk gets no money from anyone for the MP3s I put on my Sansa. GE doesn't get any share of the food I cook on my stove. If I buy a house, I'll pay a set amount, not a percentage of every dollar I earn. Whoever made my bookcases isn't entitled to a part of the purchase price of the books filling them. Why should Apple -- whom you've paid once already! -- insist that you (though the seller) pay them again to use the hardware you bought from them? You paid them once already!

[wyndslash]

Originally Posted by carld

Yes, we've been making that point from the word go with the iPad. I've even seen an Apple fan calling Flash "a cancer on the web." My eyes rolled right out of my head.

wow, really? xD; the reason why i never buy any mobile apple device by myself (my ipod touch was a gift) is because there's no flash~

[carld]

Originally Posted by ApK

I know a lot of technologists who feel that way about Flash.

They can consider themselves eyerolled too.

[Andrew H.]

Originally Posted by stonetools

There’s not too much Apple love on this issue, is there? I think there are two issues here:

1. does Apple deserve a cut of the revenue from the sales of products on its platform
2. what should be the size of the cut.

If you think that these are the issues, you don't understand the issues. No one disagrees that Apple deserves a cut of the revenue from the sales of products on its platform.

Apple gets this already, and I don't think that anyone disagrees with it.

What Apple wants is a cut of the revenue of sales *not* on its platform. Basically, Apple is saying: (1) if you have sell something outside our platform that is used on our platform, you have to *also* sell it through our platform and give us 30%; and (2) you have to sell it on our platform for the same or less than you sell it outside our platform.

From a business standpoint, the answer to 1 is Yes. Apple has , at considerable time, expense and risk, built a unique, successful – dare I say insanely great:-) – merchandising platform. Successful merchandising platforms tytpically charge merchants for the privilege of selling on their platforms.
Walmart charges manufacturers for the placement of goods on its shelves.
Best Buy gets a cut of cell phone plans sold at its stores
Shopping mall proprietors charge storeowners-including booksellers- rent for operating in their malls. No one attacks shopping mall owners for charging rent to B&N, yet when Apple hints that it may do the same thing, suddenly Apple is EEEVUUUL! What gives?

Irrelevant. Apple does charge for apps sold through its app store. This is like Walmart taking a cut from the sale of a TV in its store (which it does), and then demanding a cut from the cable company and DVD producers that produce content for WM's TV.

Part of the reason is that Ipad owners interact with their booksellers through those oh-so-convenient reading apps, which Amazon etc. thoughtfully provided to their customers for free. The consumers therefore get mad at Apple for wanting to “gouge” their “ benefactors”.
From a business point of view, of course, those reader apps are really storefronts- channels to the pockets of 160 million IOS device owners. Moreover, these storefronts operate 24/7/365, with the possibility of a sale every time someone looks at the home screen of their Idevice.
Until now, those storefronts have been operating “rent free” , despite negligible setup and rental costs. I myself am an example of this state of affairs. Before I bought my Ipad in December, I had never purchased anything from Amazon or B&N. Since that time, I have bought nine or ten ebooks from them. Not a red cent has gone to Apple, despite the fact that the purchases were made through the Ipad, for use on the Ipad, by means of apps hosted by Apple.

"Rent free" suggests that this is an unnatural state of affairs...but of course it isn't. There are also many free programs that operate on a computer; this is a very normal state of affairs.

That state of affairs was probably never going to continue.

Why? No one else thought it wasn't going to continue...which is why everyone had (and to some extent still has) difficulty parsing Apple's statements on this issue.

Steve Jobs is just too smart a businessman for that. So Apple is looking for their cut. How big should its cut be?

Apple has said 30%

Apple thinks its cut should be 30 per cent for subscription services that get a subscription through an IOS device, plus non-default access to subscriber information Google thinks 10 percent, plus default access to coveted subscriber info. Rhapsody apparently thinks 30 per cent is too high. What do I think it should be? Hell if I know. The market will settle the issue.
Now we haven’t heard anything about one time purchases like ebooks. Apple hasn’t said anything, or Amazon or the others. Some folks have been demanding clear statements from Apple. Again that’s naïve. Nobody is saying anything, because they are all NEGOTIATING, as hard as possible. Once the negotiations are done, there will be clear statements-probably on the last possible day, June 30, 2011.
I expect that there will be lots of changes, even to the dreaded agency model, as the booksellers and publishers make room for Apple’s cut. One thing is certain-Amazon , etc. will want to remain on the IOS platform, if they can possibly help it. Whatever the Android fans may think, the IOS platform is it as far as making money is concerned . The revenues from the App Store are SIXTEEN times those of the Android market. I have no doubt at all that Amazon, etc. will be on IOS come July 1.

Which is why Amazon, B&N, etc. have said that they will pull their apps come June 30.

I have no doubt that they will unless Apple "explains" that they didn't really mean what they said. Amazon is a high volume, low margin seller with a profit margin of just under 5%. Paying 30% to Apple means that they lose 25% on each book. Probably even 1% is too high. B&N's margins, I assume, are similar to Amazon's.

Android is a red herring, as are the revenues from the ios App store. B&N and Amazon aren't selling apps; they are selling books. In the US, they have approximately 95% of the e-book market. The real reason Apple is doing this, IMO, is to increase the market for its spectacularly underperforming iBook platform.

But it's not a risk-free proposition for Apple at all. People buy iPads for the apps. (Just like you buy computers to run programs). If Apple's policy means that fewer good apps are available on their platform, the platform itself becomes less desirable. And particularly wrt books - trying to lock people into iBooks will work about as well as trying to lock people into Atrac did.

[dallas]

Nothing throws cold water on iPad sales then discussing this topic with the Apple sales guy at a Best Buy on a busy Thursday night.

[snipenekkid]

Originally Posted by OverTwo

Why people like Apple products is beyond me.

I can't go that far. I've owned several pocket sized devices over the years. I have to say that the iPod Touch 4th Gen 32gb I owned for a couple weeks was maybe the best pocket sided device of any. It's not perfect, it has areas I would eventually have become frustrated with but it's a very solidly made and useful gadget. Is it worth three-bills? In a word, NO. Is it worth about $100, yup. I was happy to have had the time with it, I found it quite useful but ultimately I was happy to have been able to sell it to a buddy.

And soon after we learned of the potential for the inability to use apps which represent a major part of the reason we bought an iOS device and a major part of it's value to me.

At least now I don't have to tolerate the "...well, if you would try one you would say differently" crap.