Apple crosses the line again - UPDATE - Feds getting involved!

[FelixDeCat]

First of all, I dont and never will own any Apple products. I dont know why but everything they do pisses me off. Im not going to recount every last thing since everyone knows what they do. The lastest manuever by those money grubbers (as if the $26,980,000,000 in cash they already have isnt enough per Yahoo Finance) is to force publishers to pay for subscriptions at the Itunes store as opposed to directly from content makers. Why the move? Apple wants a cut of the subscription proft. If you dont offer subscriptions, you cant sell there. In the past, you could buy single editions.

Story:

http://online.wsj.com/article/SB10001424052748704775604576120531458250932.html?ru=yahoo&mod=yahoo_hs

Apple Inc. is working to funnel more electronic sales of magazines, newspapers and other content through its iTunes store, an effort that is making some publishers uneasy.The activity is the latest sign of the swelling influence of Apple's iTunes, which transformed sales of digital music and has more recently become a focal point for distributing software applications, or apps, for the iPhone and iPad. Apple's App Store generated $1.1 billion in revenue in 2010, just a year and a half after it was launched, estimates Gleacher & Co., an investment bank.

A small number of publishers that had their own billing systems—such as The Wall Street Journal and the Economist—have been able to offer subscriptions by taking users to their websites, but most don't have the ability to do so. Such sales through websites don't require sharing revenue with Apple.

Apple is now requiring publishers that conduct sales of content—which includes books as well subscriptions—to offer a way to do so within apps, which will be handled by the iTunes billing system. The policy, which the company says isn't new, was cited in Apple's rejection of a Sony Corp. app for reading digital books earlier this week.

update:

Now the Feds and EU are looking into this greedy Apple move:

NEW YORK/BRUSSELS (Reuters) - U.S. and European regulators are keeping tabs on Apple Inc's plans to take a cut of the revenue generated by the sale of online subscriptions through its App Store following concerns voiced by publishers.

Some app makers are unhappy with Apple's new plan to take a 30 percent cut on all revenue from online subscriptions.

Regulators at the Department of Justice have kicked off an early stage inquiry into Apple's change of policy and are in the process of contacting publishers and also Apple, according to a person familiar with the plans.

In Europe, a European Commission spokeswoman said, "We are monitoring market developments carefully." But an official investigation appears unlikely, however, as commissioners believe rivalry in the field is increasing.

EU Commissioner Andris Piebalgs -- in comments to the European Parliament on the issue -- said it requires, "that Apple holds a dominant position in the relevant market."

"The boundaries of such relevant market(s) are not clear, as the sector is relatively new and evolving."

Apple said on Tuesday that publishers can set the price and duration of a subscription. They can also offer subscriptions through their own existing websites, but would be required to offer the same terms to anyone signing up through Apple.

This would mean customers who want to sign up for a Netflix Inc video account may have just two choices: They could do so through the Netflix website, in which case Netflix would keep the full fee, or they could subscribe through the applications in their iPhone or iPad which would cost Netflix 30 percent of its fees.

Seemingly in response to Apple's plans, Google Inc on Wednesday launched a new subscription service called One Pass for its Android mobile operating system and promised to take just 10 percent of subscription revenue.

U.S. music subscription companies like Rhapsody and Rdio have described the new Apple policy as "economically untenable" for their businesses.
"Digital music is a low margins business. Rights costs typically account for over 70 percent of revenues and payments, technology and marketing taking most of the rest," said Forrester analyst Mark Mulligan. "So Apple's 30 percent levy has the potential to instantly turn premium music subscriptions from low margin to negative margin businesses."

Other media companies likely to be affected include newspaper and magazine publishers who have been looking forward to reinvigorating their flagging print sales by offering their publications through subscriptions on tablets like the iPad.

Apple was not immediately available for comment.

It is not the first time Apple has been investigated by regulators for its role in the music business which it dominates with nearly 70 percent market share of digital music sales. Last May the Justice Department spoke with Internet companies and music labels to determine if Apple was abusing its dominant position.

 

[Mike Gayner]

*yawn*

Publishers have the option of not putting their content on the app store, and consumers have the option of not buying an apple phone. As long as people are exercising their right to use this platform, Apple can do whatever the hell it wants, frankly.

 

[speg]

This is already broken down. I too was upset at the mere thought of loosing the Kindle app, but it turns out Sony didn't make their app anything like the kindle app, instead they broke a bunch of rules and guidelines, got rejected from the app store, and then cried about it.

The new "must have in app method" is interesting, and I don't know how it will play out but in the end I can't see it being a big deal.

 

[KeithP]

There is a thriving Android marketplace that publishers can develop for and consumers can purchase from (assuming they buy Android hardware) if they don't like Apple's policies.

I suggest you buy an Android device and complain about that. At least then you can complain from an informed position.

-KeithP

 

[FelixDeCat]

Apple deserves every bit of scorn I can muster. It is a quasi-monopoly because more people use their products more than those of competitors, which is QUITE unfortunate for those of us who would prefer Apple to be a lot less dominate in the marketplace.

When they throw their weight around and want to add to their huge stockpile of twenty six billion dollars in cash for a couple of bucks from publishers who are barely scraping by in comparison draws ire from well informed and forward thinking consumers.

If youre satisfied with this indolent behavior from a behemoth, your more than welcome to be sedate. Not me. No way.

I hope the government keeps a close eye on this bad Apple. :sneaky:

 

[Mike Gayner]

Apple are not even remotely close to being any type of monopoly. They have fierce competition, and no consumer should ever feel restricted to Apple devices under almost any circumstances. I hate Apple as much as the next sane person, which is why I don't use their products. Try that.

 

[JJChicken]

If you don't use apple products, why create a thread in "All about apple". You are just going to antagonize apple users.

On-topic, smart business move from Apple.

 

[Kaido]

First of all, I dont and never will own any Apple products. I dont know why but everything they do pisses me off. Im not going to recount every last thing since everyone knows what they do. The lastest manuever by those money grubbers (as if the $26,980,000,000 in cash they already have isnt enough per Yahoo Finance) is to force publishers to pay for subscriptions at the Itunes store as opposed to directly from content makers. Why the move? Apple wants a cut of the subscription proft. If you dont offer subscriptions, you cant sell there. In the past, you could buy single editions.

So -

1. Apple sells a service (App Store)
2. Apple wants a cut from companies that use its service (Publishers)

It doesn't make sense from a business standpoint to NOT take a cut. Apple has to run servers (electricity, parts, maintenance labor, bandwidth), have employees to run the app store and development, have systems to take payments, etc. It's not free to keep those systems running or in continuous development. Whereas a publisher would previously pay printing & delivery costs, now they pay a server hosting cost to Apple as a cut.

I see nothing wrong with this. It's standard business practice.

 

[Emulex]

installous

 

[ChAoTiCpInOy]

installous

Installous was meant to be a way to try out apps, and then purchase them. Also, installous wouldn't work because it's basically an in-app purchase.

 

[Tegeril]

The rule change simple requires they -add- the ability to subscribe via in app purchase, not make it the only avenue by which to subscribe.

 

[Ka0t1x]

I don't see how this is a big deal.. They want to control how things are purchased and consumed on their platform.

And as Kaido has said.. Its just a change of hands between what costs a business has to make to get the goods to the consumer.

 

[Ns1]

yeah posting an apple rant in an apple subforum, that always goes well.

 

[FelixDeCat]

yeah posting an apple rant in an apple subforum, that always goes well.

I was going to put it in OT, but I just knew it would have been moved here. So I saved them the trouble. :\

 

[theeedude]

This sounds like it's only a problem for Apple users. But they already know they are signing up to be milked, so I don't feel sorry for them.

 

[Patranus]

Apples "thing" is all about user experience.
Apple wants everything to be integrated not fragmented like Android.
They want you to be able to just click a button and be done with it.
They want the process to be as easy as possible and as smooth as possible.
Providing an in app link to make the purchase ensures this.

Now I am not ignoring their incentive for revenue but usability certainly has something to do with it.

Not sure why the amount of cash Apple has on hand has to do with anything. They are a successful company and don't waste money on things that are going to fail. They make smart investments to better their products. Not sure why this is a bad thing.

 

[Kev]

Publishers should just charge a 30% itunes surcharge for everything. Consumers will pick up on the fact that they can purchase the same content for 30% less on an outside service. Or, if they're too stupid to realize they can pay less elsewhere, they can pay the 30% extra.

This is why I never buy mp3's on itunes. I can always get it for .99 on amazon as opposed to 1.29 on itunes.

 

[runawayprisoner]

So why should this enrage users when they are not charged more for the same content?

Or why should it enrage you when you're not one of the publishers tied to the policy?

I fail to see any valid reason for this rant to be.

 

[bigsnyder]

What happened to the good ole days when Microsoft was the evil bad guy and Apple was the underdog who we rooted for to come be our savior? As they say, careful what you wish. Boy has times changed.

 

[Patranus]

What happened to the good ole days when Microsoft was the evil bad guy and Apple was the underdog who we rooted for to come be our savior? As they say, careful what you wish. Boy has times changed.

Companies are neither good or evil.

 

[Zen0]

Apple deserves every bit of scorn I can muster. It is a quasi-monopoly because more people use their products more than those of competitors, which is QUITE unfortunate for those of us who would prefer Apple to be a lot less dominate in the marketplace.

When they throw their weight around and want to add to their huge stockpile of twenty six billion dollars in cash for a couple of bucks from publishers who are barely scraping by in comparison draws ire from well informed and forward thinking consumers.

If youre satisfied with this indolent behavior from a behemoth, your more than welcome to be sedate. Not me. No way.

I hope the government keeps a close eye on this bad Apple. :sneaky:

I believe your argument comes down to:

Apple should not charge publishers a fee or commission to use its App Store service because Apple is already wealthy enough.

While it is a noble position, it is an irrational one for running a business.

 

[James Bond]

The rule change simple requires they -add- the ability to subscribe via in app purchase, not make it the only avenue by which to subscribe.

As already stated, they are just requiring that they ADD the ability to subscribe via in-app purchase. It's not the only way. You can still use the old method and not give Apple your money if you want.

I will probably use the in-app purchase just because it is easier.

 

[FelixDeCat]

I believe your argument comes down to:

Apple should not charge publishers a fee or commission to use its App Store service because Apple is already wealthy enough.

While it is a noble position, it is an irrational one for running a business.

They should not force publishers to make available subscriptions on Itunes (to scalp profit) vs. having the option of paying for them at the publishers website (no extra profit for Apple). The will either increase costs for consumers as publishers raise prices to compensate, or reduce profits for cash strapped publishers trying to reach this market.

 

[Zen0]

They should not force publishers to make available subscriptions on Itunes (to scalp profit) vs. having the option of paying for them at the publishers website (no extra profit for Apple). The will either increase costs for consumers as publishers raise prices to compensate, or reduce profits for cash strapped publishers trying to reach this market.

But they SHOULD force publishers to do this in order to increase their own profits.

Again, you are approaching this business decision irrationally as if it is natural or justified that Apple should reduce their own profits in order for other players to increase theirs.

That - will you fail to get you into business school.

 

[VinylxScratches]

a violinist plays a weeping piece for you Felix.