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An Open Letter to Apple on the Readability App rejection

478 points by bensummers 16y ago

sammcd 16y ago
Google cache: http://webcache.googleusercontent.com/search?sourceid=chrome&ie=UTF-8&q=cache:http://blog.readability.com/2011/02/an-open-letter-to-apple/ http://webcache.googleusercontent.com/search?sourceid=chrome...
- alecco 16y ago
  An Open Letter to Apple by Richard Ziade on Feb 21, 2011 Dear Apple: It’s your friends from Readability. Remember us? You put our technology into your Safari browser last year. We’re writing this open letter because – well – we’re a little upset right now. Last Friday, you notified us that our Readability iOS application was rejected. In explaining the rejection, you pointed us to 11.2 in the App Store Review Guidelines: 11.2 Apps utilizing a system other than the In App Purchase API (IAP) to purchase content, functionality, or services in an app will be rejected. We’re obviously disappointed by this decision, and surprised by the broad language. By including “functionality, or services,” it’s clear that you intend to pursue any subscription-based apps, not merely those of services serving up content. Readability’s model is unique in that 70% of our service fees go directly to writers and publishers. If we implemented In App purchasing, your 30% cut drastically undermines a key premise of how Readability works. Before we cool down and come to our senses, we might as well share how we’re feeling right now: we believe that your new policy smacks of greed. Subscription apps like ours represent a tiny sliver of app sales that represent a tiny sliver of your revenue. You’ve achieved much of your success in hardware sales by cultivating an incredibly impressive app ecosystem. Every iPad or iPhone TV ad puts the apps developed by companies like ours front and center. It was a healthy and mutually beneficial dynamic: apps like ours get exposure and you get to show the world how these apps make your hardware shine. That’s why we’re a bit baffled here. To be clear, we believe you have every right to push forward such a policy. In our view, it’s your hardware and your channel and you can put forth any policy you like. But to impose this course on any web service or web application that delivers any value outside of iOS will only discourage smaller ventures like ours to invest in iOS apps for our services. As far as Readability is concerned, our response is fairly straight-forward: go the other way… towards the web. Since we re-launched, we’ve already seen a significant amount of usage across a wide range of browsers, operating systems and devices via the Readability web interface – for both mobile and desktop. Looking ahead, we plan to redouble our efforts to deliver the best possible reading app using the latest best-of-breed web technology. The new Readability is fueled by the free-form nature of the web. Just as content pumps through the web’s piping, apps like ours thrive as nodes on the web – unencumbered by levies or barriers imposed by others. As we said months ago: “for us, the web is the right bet.” Still, we’re always looking to give readers the best possible reading experience and a native iOS client would help us do that. We hope you’ll change your mind. If you do, we’d be happy to resubmit the Readability iOS app. Regards, The Readability Team P.S. We’d we be glad to deliver Readability for iOS – with in-app purchasing – if you’d carve out 70% from your 30% fee and share it with writers and publishers, just as we do.
kmfrk 16y ago
I like to think of Apple's side of all the negative stories, but this time, I can't come up with a cogent excuse for what they are doing - save inept App Store policies/reviewers. By this logic, flattr will never get a native iOS app. And when are Apple going to shut the Instapaper app down, when Marco decides to let his one-dollar monthly subscribers[1] receive premium benefits? Apple really hates newspapers and magazines. [1]: http://www.instapaper.com/subscription http://www.instapaper.com/subscription
- statictype 16y ago
  I think a large chunk of Instapaper's revenue comes from the iOS apps so assuming Apple continues to keep acting like a douche, Marco would probably just as soon cancel the subscription plan rather than let his app get rejected.
  - kmfrk 16y ago
    How dare you answer my rhetorical questions?! :) That's the most obvious route for Marco - the (rhetorical!) question was directed at Apple, because they appear to thwart a large domain of what iOS could be used for.
  - nika 16y ago
    When he doesn't, and when he adds in-app subscriptions, will it cause you to revise your perspective? Instapaper is exactly the kind of app this is directed at. It is a SaaS subscription. It would be foolish to turn away all the additional sales you'd get by being able to offer subscriptions within the app (something you couldn't do previously, forcing Marco to take paypal.)
    - statictype 16y ago
      When he doesn't, and when he adds in-app subscriptions, will it cause you to revise your perspective? Sure, I'd be curious to see if it's economical to hand over 30% of whatever subscriptions he receives to Apple.
Niten 16y ago
> To be clear, we believe you have every right to push forward such a policy. In our view, it’s your hardware and your channel and you can put forth any policy you like. It isn't Apple's hardware; let us not forget the hardware belongs to the people buying the iPhones and iPads out there. Apple's enforcement of what can and can not run on these devices is not some fundamental property right, but an artificial construct.
- rimantas 16y ago
  There was another part that you omitted "and your channel". Or did people buy that also?
  - Kylekramer 16y ago
    That is part of the artificial construct. There is no reason for the channel to be Apple's except that they enforce ridiculous rules like this rejection to maintain complete control. And the channel loses value every time they pull something like this.
    - rimantas 16y ago
      I don't get your argument. > There is no reason for the channel to be Apple's How about the reason that it is Apple's? And why would they not want to have their rules on their channel? I am also not sure about ridiculousness of the rules; and finally "losses value"—it depends. One can argue that this is true for some segment wanting to participate in Apples ecosystem, but it is offset by another, larger, segment which actually benefits from it.
      - gaustin 16y ago
        >How about the reason that it is Apple's? And why would they not want to have their rules on their channel? The only viable channel at this point is Apple's. If there were a way to access non-Apple blessed applications without rooting your device, then people might not complain so much. Savvy consumers don't appreciate monopolies.
joebananas 16y ago
So basically: "We totally think your policies are right and groovy, but please make an exception for us"?
- shantanubala 16y ago
  Not quite. More like a "we know it's in your legal power to be needlessly greedy, but we'd like you to stop swimming in money and be a little more friendly for small developers."
talbina 16y ago
Why do these types of letters have to start with the headline "An Open Letter to...". If you're publishing it, it's obviously open.
- Bud 16y ago
  Just to be nice and actually answer this person's question rather than just downvoting them: The distinction, as I understand it, is that labeling it an "open letter" tells us that one entity (Readability) intends not just to publish a given letter for all to read, but also make clear that it is directed at a second entity (in this case, Apple), in the same way as if Readability had sent it directly TO Apple. It is also often hoped that such an open letter might elicit a public response.
russnewcomer 16y ago
I really don't understand Apple's moves here. They have a terrific platform, and much of the value of their platform comes from third-party apps. If app devs start leaving for WebOS or Android in droves, much of their traction is going to be lost. I think if they would have gone for 10% or 15% they wouldn't have gotten this kind of response. I predict either reversals or abandonment of their platform. I still maintain that HP or RIM have a great opportunity here to announce that they are going to build app stores that are low fee for subscription apps. I think you'd definitely see a move there from numerous devs. And I too worry that my beloved Instapaper may be going to face trouble soon as well.
- thailandstartup 16y ago
  Apple feels its position is now strong enough that it can dictate terms.
  - tomjen3 16y ago
    Considering that almost nothing happened when the iphone was released on Verizon, Apple is at an extremely weak position and can not only not dictate terms but they are very far from being at a point where they can.
    - marshray 16y ago
      Perhaps it really does reflect Jobs' weakness, or maybe he's behind it all too. Man if it were my business I sure wouldn't want to risk pissing off developers or the consumers right now: http://www.zdnet.com/blog/btl/how-will-smartphone-market-share-figures-be-impacted-by-launch-of-verizon-iphone/44349 http://www.zdnet.com/blog/btl/how-will-smartphone-market-sha...
  - kenjackson 16y ago
    Funny how everyone used to say that Apple was benevolent due to their actions in the PC space. My argument was always they've never been in a position to really be aggressive. Now that they are in a borderline position they are quickly being a lot less benevolent. Does anyone honestly think if they had 90% PC/browser share they'd be "nicer" than Microsoft?
statictype 16y ago
Perhaps this will be the one that gets enough publicity to make Apple come to their senses and see the collateral damage being caused by their War on Amazon.
- sofuture 16y ago
  The collateral damage? They're making out just fine, what do they care about a handful of app developers? Maybe this will be the one that gets developers to realize this is not a sustainable game they are playing with Apple, by Apple's rules, in Apple's world.
maguay 16y ago
If the subscriptions policy isn't the absolutely craziest move Apple's ever made, I don't know what is. iOS has converted me into an Apple fan, but not if stuff like this continues.
- Zakuzaa 16y ago
  It still doesn't beat the "Objective-C Only" fiasco..does it?
  - maguay 16y ago
    It's a strong second place then if it's not the first. Good thing is, Apple backed down on that which is why I was just today trying out Airplay SDK on Windows. Hopefully they'll back down on the subscriptions plan, too. That said, it really should require us all getting up in arms over it for Apple to stop stuff like this. They shouldn't have made such a policy to start with! Very worrying for the future of the platform...
    - nika 16y ago
      That policy has been in place for 2.5 years, since the original AppStore terms and conditions. It wasn't enforced because before now, Apple didn't offer SDK support for subscriptions. People have had 2.5 years to prepare.
      - maguay 16y ago
        The App Store terms have said that subscriptions had to be offered though Apple since the App Store was launched? As far as I'd heard, this was just added...
      - zacharypinter 16y ago
        To draw a parallel: A law is only as good as it is enforced. There's a huge amount of laws out there that would be very controversial if they started getting enforced. For example, many states still have crazy/puritanical sex laws on the books.
iPhone1 16y ago
What a slap to the face. Apple uses their technology then tells them they can't use it themselves without offering in app purchases?!?!
- kmfrk 16y ago
  Not exactly. If you haven't read about it, Readability (Arc90) has a new subscription model[1]. That's the point of contention. (Not that it's any less stupid.) [1]: https://www.readability.com/learn-more https://www.readability.com/learn-more
  - iPhone1 16y ago
    I know about the subscription model; I'm a subscriber.
- panacea 16y ago
  I could be wrong, but I don't think Apple actually used their technology, but rather implemented a similar feature into desktop Safari.
  - maguay 16y ago
    Actually, if you look in the Safari 5 credits, you'll find reference to the original Readability script. Here's the official Readability (arc90) blog post about it: http://blog.arc90.com/2010/06/10/why-we-built-readability/ http://blog.arc90.com/2010/06/10/why-we-built-readability/
jammur 16y ago
I'm fairly quick to defend Apple, because a lot of the flack they take is BS, but in this case I'm really struggling to find the upside. Richard says that their 30% would account for a tiny sliver of Apple's overall revenue, but lots of tiny slivers start to add up eventually. The problem though, is that if the cost of those slivers is to drive the developers away from the App Store, then those slivers disappear. Considering that third party apps are possibly the most important feature of the platform, it doesn't seem like a smart idea. The 30% cut on App sales is understandable, because software generally has high margins, but it doesn't sound like the same is true for content subscriptions. Maybe it's a case of trying to keep their policy too uniform (i.e 30% on everything)? Does anyone know where the subscription content comes from? From my understanding, the subscription content will usually come from a third party, rather than Apple's CDN, so there's no marginal cost to Apple.
EnderMB 16y ago
This may be a stupid comment to make, but one I feel should be added to the conversation. Why are people so willing to develop for Apple when Android is now the larger platform, and has a far easier barrier to entry?
- yannickmahe 16y ago
  Revenue on iOS devices is far greater than on Android devices: it seems people paying for Apple products are far more eager to pay for apps.
  - kenjackson 16y ago
    What about ad revenue? Angry Birds appears to be making more money from Google ads than iOS sales, from what I can tell...
- ekanes 16y ago
  In part because Android's many devices/configurations make it a less predictable development platform. (I'm not saying there aren't reasons to develop for Android, but you asked for one reason people don't do it more.)
  - estel 16y ago
    I'm not sure I've talked to a single Android developer I know, including myself (yes, I talk to myself) that sees fragmentation as a significant difficulty in developing apps. Something to consider whilst developing? Of course (and fundamentally moreso if someone wants to support tablet devices now), but supporting multiple devices is something that Google's made ridiculously easy.
    - robrenaud 16y ago
      A friend of mine develops games for phones professionally, and he says fragmentation and the lack of ability to query the device for what operations it supports and only sell software for the supported hardware is a big problem for him.
Xpirate 16y ago
I wonder if there are anti-trust concerns here.
joshmanders 16y ago
I don't understand why Apple is putting themselves in this situation.. Bad for business. Apple HAD the market, then Google came along with Android, now they're being snobs and just forcing their own users to switch to Android powered phones just because of this exact thing. Shame really.
nika 16y ago
I think it is worth noting, because everyone seems to have forgotten, that this has always been the rule. I remember it from the very first reading of the terms and conditions (back when they were under NDA). It has always been against AppStore rules to monetize apps outside of the AppStore. Apple has been lax in enforcing it, primarily because Apple didn't offer a subscription mechanism. Now they offer a mechanism, and so now people can comply with the rule, and so now they are enforcing it.
- dpcan 16y ago
  The same thing happens in the Android Market. Apps get removed for policies that have always been there, and then they complain that they exist AFTER they develop the app. READ THE TOS PEOPLE.
- ChrisLTD 16y ago
  A rule isn't a rule until it's enforced. Apple has effectively changed the rules after tricking companies like Amazon and Netflix to develop software for the App Store, which was – until now – a mutually beneficial arrangement.
  - commandar 16y ago
    Wasn't Netflix functionality something Apple used as a selling point for the iPad?
ascendant 16y ago
Through all of this I wonder if they knew there'd be so much angst and now they will "concede" to something like 15% with that being their plan all along. When you make a policy that's really really really bad to then scale it back to just being really bad, people think they're getting a deal.
MartinCron 16y ago
I haven't heard anything about this subscription model and Netflix. Will Netflix be able to continue to provide their iOS apps without giving a cut to apple? Seems crazy that they would have to.
- irons 16y ago
  Netflix may be exempt, somehow: http://www.businessinsider.com/netflix-not-affected-by-apples-new-subscription-plan-2011-2 http://www.businessinsider.com/netflix-not-affected-by-apple...
  - MartinCron 16y ago
    It implies that Amazon could get around this just by removing the "get books" button from their kindle iPhone client, requiring people to make purchases from a browser.
kenjackson 16y ago
DHH, if you're reading, is this what you were talking about?
sacrilicious 16y ago
Believe you me, I want these guys to succeed as much as anyone else, but... wouldn't keeping the payment processing for subscriptions OUTSIDE of the iOS app solve the issue? I must be missing something critical to the functionality of the app? There are no non-profit or even strictly business-related terms under the umbrella of the App Store as far as I know. There are no corporate/business iTunes purchasing accounts, no escalation to root-level privileges allowed for apps in the MacAppStore(postponing backup and other more powerful apps). This seems like another oversight on Apples part due to treating it as a lower priority. And although they have every right to be proud of their achievements, it seems a bit like "you owe me" to remind Apple that they used the Apache-licensed Readability tech for Reader. Their proposed app could stand on its on.
- msbarnett 16y ago
  > Believe you me, I want these guys to succeed as much as anyone else, but... wouldn't keeping the payment processing for subscriptions OUTSIDE of the iOS app solve the issue? What you're missing is the other rules which force you to offer purchase via IAP because you offer subscriptions outside the app, too. The following terms apply: 11.1 -- Apps that unlock or enable additional features or functionality with mechanisms other than the App Store, except as approved in section 11.13, will be rejected 11.12 -- Apps offering subscriptions must do so using IAP, Apple will share the same 70/30 revenue split with developers for these purchases, as set forth in the Developer Program License Agreement. 11.13 -- Apps can read or play approved content (magazines, newspapers, books, audio, music, video) that is sold outside of the app, for which Apple will not receive any portion of the revenues, provided that the same content is also offered in the app using IAP at the same price or less than it is offered outside the app. This applies to both purchased content and subscriptions. 11.14 -- Apps that link to external mechanisms for purchasing content to be used in the app, such as a “buy" button that goes to a web site to purchase a digital book, will be rejected
- lukifer 16y ago
  The terms of the App Store expressly forbid offering a subscription payment service which is not also available using Apple's 30% API. That's why people are upset.
damoncali 16y ago
The reason this doesn't work is because Apple had to pick a number - 30%. For some businesses, that makes perfect sense. for others 1% or maybe 70% might make sense. But rigidly adhering to 30% (no doubt because of the massive complexity of the alternative) is going to cut lots of business out just because it doesn't make sense. Apple needs to rethink this - it's clumsy.
- foobarbazetc 16y ago
  They have to pick 30% because in-app purchases are charged at 30%. You can't have two variations of the same thing (one that auto-renews and one that doesn't) charged differently. Let's say the subscription cut was 10%. Everyone would release their apps as free, and charge for everything as a "subscription" because it's less than the 30% cut for app sales or non-auto renewable in-app purchases. Basically, there is no other percentage that Apple can use here, for very good reasons. If they lower the percentage for this, they have to lower all the other percentages. And that's not going to happen, because 30% is pretty reasonable for what they provide. The Android Market takes 30%, and Amazon takes 70% for Kindle subscriptions. Edit: IMHO, everyone talking about the percentage is missing the point. The problem is the policy itself. It's just too general and broadly applied for a huge amount of stuff out there. Marco nails the issues here: http://www.marco.org/3437484678 http://www.marco.org/3437484678
  - damoncali 16y ago
    The way I see it, 30% is not "pretty reasonable". It might be reasonable, it might be a great deal, or it might be a deal killer. It's not much different than if Google were to decide that all AdWords clicks are now $3. The thing is that nobody cared when it was a one time fee for their $1.99 app. When Apple starts talking about subscriptions that may cost 10's or 100's of times that each month, Apple starts to look like their overreaching - and it could be damaging to long term adoption of the platform. One might even hypothesize that these ham fisted policies are defining the very nature of the offerings in the app store - it explains the preference for fart apps over sophisticated (expensive) products. Apple is just coming off as if they didn't think this through.
tel 16y ago
P.S. We’d we be glad to deliver Readability for iOS – with in-app purchasing – if you’d carve out 70% from your 30% fee and share it with writers and publishers, just as we do. This will never happen, but if it did I'd be ecstatic. It could be a great PR move and really help Readability's goals to fund independent content producers online.
T-hawk 16y ago
We don't like it, but Apple's got every allowance and reason to do this. Either Readability will cave to Apple's pricing model, or somebody else will come in with the same technology and do so. Apple believes that the competitive position they have attained allows them to dictate pricing terms. The market will decide whether they are correct. The only argument against Apple that holds water is abuse of monopolistic power, but I don't think that will fly given that the whole market of Android and Windows and other phones also exists.
petercooper 16y ago
My satellite TV provider has an app I can only use if signed up to them. Do they now need to offer TV subscription through their app? What about the 37signals Campfire clients? Do they now need to offer Campfire subs via inapp purchase too?
- elehack 16y ago
  My understanding is that yes, Apple wants them to.
- rimantas 16y ago
  Answer to the first one is no, because you don't get their service in the app.
  - Bossman 16y ago
    As far as I can tell, Apple's new guidelines wouldn't let them put that app in the App Store anymore. Apple's guidelines say you have to sell through the app using their API and can't sell anywhere else. And you can't link to a place where customers can buy your service outside of Apple's control.
    - diamondsea 16y ago
      They can sell other places, but not promote those other places within the app. They could offer their subscription on their web site and collect 100%. Their app would then be required to offer the same subscription deal as an in-app purchase for the same-or-lower price, and then they would collect 70%. The app could not refer users to their web site for purchases.
jpwagner 16y ago
I think they might have a point, but their ineffective communication style and adversarial tone will surely guarantee they are ignored this time around.
mjfern 16y ago
I posted this to my blog a few days ago, but I think it's worth repeating here because it applies directly to this open letter: While apps and content are just break even businesses for Apple, they are instrumental to the company's financial success. The iPod, iPhone, and iPad are each technology platforms that bring together consumers, apps, and content. The value of each platform (iPod, iPhone, and iPad) to consumers hinges on the availability of apps and content; and the value of each platform to app developers and content publishers hinges on the number of consumers that have adopted the platform. In short, there is a virtuous circle in effect; hardware sales to consumers attract more app developers and content publishers, and more apps and content drive more hardware sales to consumers. Apple’s new subscription model might strain or even break this virtuous circle. First, since Apple is only requesting 30% of revenues if content is subscribed to through iTunes it will likely cause content publishers to encourage consumers to bypass iTunes and purchase content directly. Over time this may reduce the relevance and significance of iTunes. Second, this 30% cut will compel app developers and content publishers to find alternative, less-expensive distribution channels. Google is the natural alternative given Android and the Android Market, and the company has already launched the “One Pass” payment system, which charges a lower fee (10%). If this new subscription model is potentially damaging to Apple’s financial success, then what’s motivating Apple to launch such a model? It’s possible, though very unlikely, that Apple failed to consider the implications of the model and the strain it would place on app developers and content publishers. A second, more likely scenario is that this subscription model reflects efforts by Apple to generate greater revenues and profits from its apps and content business. A third likely scenario is that Apple is trying to create barriers to entry for competing distribution platforms, such as Netflix and Amazon, which will find it cost prohibitive to offer their service through iTunes given the 30% in fees. These barriers may give Apple time to further develop its own content distribution business. The immediate risk that content publishers will turn en masse to Android is low given the delay of Android-based tablets and other connected devices (e.g., connected TVs). This subscription model may boost iTunes revenues and profits, and it may create a barrier to entry for competing distribution platforms, such as Netflix and Amazon. That said, I believe this move is a strategic mistake. There may be some short-term benefits to Apple, but overall it will strain the company’s relationship with app developers and content publishers. Over time this will reduce the selection of apps and content available via iTunes, reducing the value of Apple products to consumers, thus putting downward pressure on hardware sales. In the meantime, partners and resources will migrate away from Apple, towards Android. Over time this will add further energy to Android adoption for app developers, content publishers, consumers, and hardware producers. Android is already emerging as a force in smartphones. With the launch of Motorola’s Xoom and other tablets, Android will soon gain significant share in the tablet market as well.
lwhi 16y ago
I think Apple may have decided to enforce an untenable rule, simply so it can be used as a reasonably large concession when the antitrust machinery slides into gear. If you are going to be required to give up ground - you might as well grab all the ground you can prior to any punitive action.
- billswift 16y ago
  That sounds like the man who beat his head against the wall; because it felt so good when he quit.
  - lwhi 16y ago
    I know what you mean - this scenario sounds quite backwards, but I'm really having quite a lot of trouble understanding why Apple has decided to go ahead with this. If they honestly think they can get away with it, I think this might be a signal that they're losing touch with their community.
OpieCunningham 16y ago
If I understand Readability's issue, it breaks down like this: What they want: For a $1 subscription fee, Readability keeps $0.30 and the publisher/writer of the articles viewed through that $1 sub get $0.70 What Apple requires: For a $1 subscription fee, Apple keeps $0.30, Readability then has the option of keeping $0.30 (30% of $1) or $0.21 (30% of the remainder after Apple's cut) and then the publisher/writer gets either $0.40 or $0.49, respectively. Why does Readability feel they deserve $0.30 but Apple doesn't? If Apple doesn't deserve $0.30, shouldn't the publisher/writer get the full $1? Without the articles, Readability is worthless. Without Apple, Readability for iOS is worthless.
- krschultz 16y ago
  I think its a little different. Readability has made a contract with the media suppliers: you get 70% of every dollar from the customer. If Apple takes the other 30%, there is 0% left for Readability. If they want to make any kind of revenue for themselves in Apple's system, the only option is to give the content creators a smaller percentage and charge a higher price. It's not really a matter of if Readability deserves 30%, but if Readability deserves any money at all. Apple is basically eating their entire revenue stream.
  - frossie 16y ago
    It's actually worse than that. Readability is passing money to publishers for FREE CONTENT. Its model is not a purchase or even a subscription - it is essentially a donation. I don't have to pay to see this content, I choose to. I wonder how this affects the Instapaper "back door" to Readability (which is what I use) I am also wondering where this is goingn to end. Why not ask for 30% off Evernote subscriptions too? Or every cloud accessing iPhone app? This isn't going to end well.
    - OpieCunningham 16y ago
      It's not free content, it's ad supported content. Readability is a service that, among other things and perhaps primarily, removes ads.
ajays 16y ago
I believe what Apple is trying to do is to head off the possibility of being scammed: app writers can give away their apps for free, but unlock the full potential only when you "buy" a (lifetime) subscription. This way the writer can keep 100% of the price of the app, instead of just 70%. Do I agree with Apple? No. But I think this is where they're coming from.
- jerome_bent 16y ago
  Apple already had measures in place to block that 'loophole' without these new rules—or new interpretations of the rules, if you will. Apple banned an update to ReadItLater, last year, because the reviewer believed the developer was attempting to circumvent the in-app purchase: http://readitlaterlist.com/blog/2010/08/version-2-2-rejected-new-rejection-reason-from-apple-may-have-major-implications/ http://readitlaterlist.com/blog/2010/08/version-2-2-rejected...
nhangen 16y ago
I tend to agree with Apple's right to do this, but I can't tell if it's a genius move or a stupid move. I think this move could further empower Apple, in as much as to put people like Rhapsody out of business. On the other hand, it makes sense to create a hospitable ecosystem, and right now it feels like they are carpet bombing what was once a nice place to hang out. More of my thoughts here (podcast) http://bluerize.com/free-market-anarchy-020-apple-subscription http://bluerize.com/free-market-anarchy-020-apple-subscripti...
nnutter 16y ago
Apple, I bought an iPad because I could watch movies in Netflix and read bookmarks in Instapaper, news in Reeder, and books in Kindle. Please send each $37.50 (30% of the iPad sale shared four ways) to each developer for bringing you a customer. Or, optionally, stop acting like you, as a middle man, provides more added value than the developers that make your platform so damn profitable. P.S. WebOS still looks pretty damn nice.
guelo 16y ago
As a developer I made the decision a few years ago to move away from Apple's platforms because of their capriciousness, their extreme secrecy, and their lack of respect for their developers. I don't know how people invest in their platforms, I'd be constantly scared that Apple would turn around and screw me over.
- ChrisLTD 16y ago
  The trick is to get in, make your money, and get out before Apple decides it wants in on your territory.
toast76 16y ago
I picked up an iPhone 3GS when they came out with intent of developing iOS apps. Even at that time it was clear that playing in someone else's yard meant playing by their rules, and that it was highly likely that I wasn't going to like their rules. I decided to not make an app. Simple decision really. A lot of developers are now complaining that they're getting burned by what is a reasonably obvious profit motive from Apple. They're not offering an app store because they're good guys. They're offering an app store to make money. They take 30% of purchases. It only makes sense to take 30% of in-app purchases and related subscription services as well. Did anyone honestly believe that apple would fall for the ebay $0.90 purchase with $90 shipping fee-dodging trick? Letting subs through just opens the door for people to ship free apps with subscription "unlocks", thus cutting out Apple. The simple fact is that Apple owns the mountain, and if you want to mine their gold you can expect to pay their taxes. Of course the simple solution is to just build a web app (as these guys have done). Why restrict yourself to Apple's yard and Apple's rules when you can target every device without rules, without restrictions and without a 30% tax? The sooner ever developer realizes this the better off we'll all be.
thought_alarm 16y ago
The App Store does have the potential to drive a massive amount new business for an app like Readability. Apple believes they should be paid for that publishing and marketing service and it's hard to argue about that, particularly when comparing to the relative poor performance of other "app stores." If the App Store fails to bring these developers new business then it doesn't cost the developers anything. If the App Store does bring them new business then it's up to the developers to weigh the cost of the App Store vs. the new business it brings. Is 30% the right price? Ultimately the market will decide that, because if there's one thing this industry doesn't lack, it's competition.
joe_the_user 16y ago
I'm not impressed with anyone here... Readability was trusting enough to release their code with a license which allowed Apple to put the code in their product and then freeze readability's product out of Apple's store. And now the readability folks don't seem inclined to admit their trust was a might miss-placed. But perhaps that's because the readability model is aiming for a kinder, gentler version of Apple's monopoly. They distributed a "product" that reworking website in a manner that steals the original site's advertising revenue. And then they "offer" to give the authors a different revenue source (along with "offering" a lack of choice concerning how their product is presented). Edit: And problem with readability isn't in it just distributing a web-site-rewriter in itself but it doing that AND then asking revenues from content providers...
deleted 16y ago
[deleted]
jrockway 16y ago
I wish these open letters said, "we are ebaying our iPhones, removing our other apps from the App Store, and switching to Android and Windows Mobile" instead of "we are going to change our business model just because the default icons you guys pick are so great". Apple does not care about whiney letters. They might care if there are no more apps for or users of iOS.
trout 16y ago
I don't understand the legal ownership fuss of their decision. If they had decided to take 5% instead of 30% there would be no discussion here. The only difference between 5% and 30% appears to be whether or not it's a good business decision. It does alienate a number of applications that have less than 30% margin, but that appears to be Apple's motivation. I would not go so far to say this should be expected, but it's a risk you take when you play with a company that likes to own such a large portion of the experience.
devin 16y ago
Avoiding a lot of the discussion here to make a quick but important observation: I suggested in a comment I believe I posted here months ago that Apple would add its "Reader" to the iOS platform. This is a calculated move on Apple's part to make sure that when they deploys Safari Reader for the iPhone it is /their/ idea and not the folks at Readability. Shame, shame, shame. I know you're name.

478 points by bensummers 16y ago

Google cache: http://webcache.googleusercontent.com/search?sourceid=chrome&ie=UTF-8&q=cache:http://blog.readability.com/2011/02/an-open-letter-to-apple/ http://webcache.googleusercontent.com/search?sourceid=chrome...

alecco 16y ago
An Open Letter to Apple by Richard Ziade on Feb 21, 2011 Dear Apple: It’s your friends from Readability. Remember us? You put our technology into your Safari browser last year. We’re writing this open letter because – well – we’re a little upset right now. Last Friday, you notified us that our Readability iOS application was rejected. In explaining the rejection, you pointed us to 11.2 in the App Store Review Guidelines: 11.2 Apps utilizing a system other than the In App Purchase API (IAP) to purchase content, functionality, or services in an app will be rejected. We’re obviously disappointed by this decision, and surprised by the broad language. By including “functionality, or services,” it’s clear that you intend to pursue any subscription-based apps, not merely those of services serving up content. Readability’s model is unique in that 70% of our service fees go directly to writers and publishers. If we implemented In App purchasing, your 30% cut drastically undermines a key premise of how Readability works. Before we cool down and come to our senses, we might as well share how we’re feeling right now: we believe that your new policy smacks of greed. Subscription apps like ours represent a tiny sliver of app sales that represent a tiny sliver of your revenue. You’ve achieved much of your success in hardware sales by cultivating an incredibly impressive app ecosystem. Every iPad or iPhone TV ad puts the apps developed by companies like ours front and center. It was a healthy and mutually beneficial dynamic: apps like ours get exposure and you get to show the world how these apps make your hardware shine. That’s why we’re a bit baffled here. To be clear, we believe you have every right to push forward such a policy. In our view, it’s your hardware and your channel and you can put forth any policy you like. But to impose this course on any web service or web application that delivers any value outside of iOS will only discourage smaller ventures like ours to invest in iOS apps for our services. As far as Readability is concerned, our response is fairly straight-forward: go the other way… towards the web. Since we re-launched, we’ve already seen a significant amount of usage across a wide range of browsers, operating systems and devices via the Readability web interface – for both mobile and desktop. Looking ahead, we plan to redouble our efforts to deliver the best possible reading app using the latest best-of-breed web technology. The new Readability is fueled by the free-form nature of the web. Just as content pumps through the web’s piping, apps like ours thrive as nodes on the web – unencumbered by levies or barriers imposed by others. As we said months ago: “for us, the web is the right bet.” Still, we’re always looking to give readers the best possible reading experience and a native iOS client would help us do that. We hope you’ll change your mind. If you do, we’d be happy to resubmit the Readability iOS app. Regards, The Readability Team P.S. We’d we be glad to deliver Readability for iOS – with in-app purchasing – if you’d carve out 70% from your 30% fee and share it with writers and publishers, just as we do.

kmfrk 16y ago

I like to think of Apple's side of all the negative stories, but this time, I can't come up with a cogent excuse for what they are doing - save inept App Store policies/reviewers. By this logic, flattr will never get a native iOS app. And when are Apple going to shut the Instapaper app down, when Marco decides to let his one-dollar monthly subscribers[1] receive premium benefits? Apple really hates newspapers and magazines. [1]: http://www.instapaper.com/subscription http://www.instapaper.com/subscription

statictype 16y ago
I think a large chunk of Instapaper's revenue comes from the iOS apps so assuming Apple continues to keep acting like a douche, Marco would probably just as soon cancel the subscription plan rather than let his app get rejected.
- kmfrk 16y ago
  How dare you answer my rhetorical questions?! :) That's the most obvious route for Marco - the (rhetorical!) question was directed at Apple, because they appear to thwart a large domain of what iOS could be used for.
- nika 16y ago
  When he doesn't, and when he adds in-app subscriptions, will it cause you to revise your perspective? Instapaper is exactly the kind of app this is directed at. It is a SaaS subscription. It would be foolish to turn away all the additional sales you'd get by being able to offer subscriptions within the app (something you couldn't do previously, forcing Marco to take paypal.)
  - statictype 16y ago
    When he doesn't, and when he adds in-app subscriptions, will it cause you to revise your perspective? Sure, I'd be curious to see if it's economical to hand over 30% of whatever subscriptions he receives to Apple.

Niten 16y ago

> To be clear, we believe you have every right to push forward such a policy. In our view, it’s your hardware and your channel and you can put forth any policy you like. It isn't Apple's hardware; let us not forget the hardware belongs to the people buying the iPhones and iPads out there. Apple's enforcement of what can and can not run on these devices is not some fundamental property right, but an artificial construct.

rimantas 16y ago
There was another part that you omitted "and your channel". Or did people buy that also?
- Kylekramer 16y ago
  That is part of the artificial construct. There is no reason for the channel to be Apple's except that they enforce ridiculous rules like this rejection to maintain complete control. And the channel loses value every time they pull something like this.
  - rimantas 16y ago
    I don't get your argument. > There is no reason for the channel to be Apple's How about the reason that it is Apple's? And why would they not want to have their rules on their channel? I am also not sure about ridiculousness of the rules; and finally "losses value"—it depends. One can argue that this is true for some segment wanting to participate in Apples ecosystem, but it is offset by another, larger, segment which actually benefits from it.
    - gaustin 16y ago
      >How about the reason that it is Apple's? And why would they not want to have their rules on their channel? The only viable channel at this point is Apple's. If there were a way to access non-Apple blessed applications without rooting your device, then people might not complain so much. Savvy consumers don't appreciate monopolies.

joebananas 16y ago

So basically: "We totally think your policies are right and groovy, but please make an exception for us"?

shantanubala 16y ago
Not quite. More like a "we know it's in your legal power to be needlessly greedy, but we'd like you to stop swimming in money and be a little more friendly for small developers."

talbina 16y ago

Why do these types of letters have to start with the headline "An Open Letter to...". If you're publishing it, it's obviously open.

Bud 16y ago
Just to be nice and actually answer this person's question rather than just downvoting them: The distinction, as I understand it, is that labeling it an "open letter" tells us that one entity (Readability) intends not just to publish a given letter for all to read, but also make clear that it is directed at a second entity (in this case, Apple), in the same way as if Readability had sent it directly TO Apple. It is also often hoped that such an open letter might elicit a public response.

russnewcomer 16y ago

I really don't understand Apple's moves here. They have a terrific platform, and much of the value of their platform comes from third-party apps. If app devs start leaving for WebOS or Android in droves, much of their traction is going to be lost. I think if they would have gone for 10% or 15% they wouldn't have gotten this kind of response. I predict either reversals or abandonment of their platform. I still maintain that HP or RIM have a great opportunity here to announce that they are going to build app stores that are low fee for subscription apps. I think you'd definitely see a move there from numerous devs. And I too worry that my beloved Instapaper may be going to face trouble soon as well.

thailandstartup 16y ago
Apple feels its position is now strong enough that it can dictate terms.
- tomjen3 16y ago
  Considering that almost nothing happened when the iphone was released on Verizon, Apple is at an extremely weak position and can not only not dictate terms but they are very far from being at a point where they can.
  - marshray 16y ago
    Perhaps it really does reflect Jobs' weakness, or maybe he's behind it all too. Man if it were my business I sure wouldn't want to risk pissing off developers or the consumers right now: http://www.zdnet.com/blog/btl/how-will-smartphone-market-share-figures-be-impacted-by-launch-of-verizon-iphone/44349 http://www.zdnet.com/blog/btl/how-will-smartphone-market-sha...
- kenjackson 16y ago
  Funny how everyone used to say that Apple was benevolent due to their actions in the PC space. My argument was always they've never been in a position to really be aggressive. Now that they are in a borderline position they are quickly being a lot less benevolent. Does anyone honestly think if they had 90% PC/browser share they'd be "nicer" than Microsoft?

statictype 16y ago

Perhaps this will be the one that gets enough publicity to make Apple come to their senses and see the collateral damage being caused by their War on Amazon.

sofuture 16y ago
The collateral damage? They're making out just fine, what do they care about a handful of app developers? Maybe this will be the one that gets developers to realize this is not a sustainable game they are playing with Apple, by Apple's rules, in Apple's world.

maguay 16y ago

If the subscriptions policy isn't the absolutely craziest move Apple's ever made, I don't know what is. iOS has converted me into an Apple fan, but not if stuff like this continues.

Zakuzaa 16y ago
It still doesn't beat the "Objective-C Only" fiasco..does it?
- maguay 16y ago
  It's a strong second place then if it's not the first. Good thing is, Apple backed down on that which is why I was just today trying out Airplay SDK on Windows. Hopefully they'll back down on the subscriptions plan, too. That said, it really should require us all getting up in arms over it for Apple to stop stuff like this. They shouldn't have made such a policy to start with! Very worrying for the future of the platform...
  - nika 16y ago
    That policy has been in place for 2.5 years, since the original AppStore terms and conditions. It wasn't enforced because before now, Apple didn't offer SDK support for subscriptions. People have had 2.5 years to prepare.
    - maguay 16y ago
      The App Store terms have said that subscriptions had to be offered though Apple since the App Store was launched? As far as I'd heard, this was just added...
    - zacharypinter 16y ago
      To draw a parallel: A law is only as good as it is enforced. There's a huge amount of laws out there that would be very controversial if they started getting enforced. For example, many states still have crazy/puritanical sex laws on the books.

iPhone1 16y ago

What a slap to the face. Apple uses their technology then tells them they can't use it themselves without offering in app purchases?!?!

kmfrk 16y ago
Not exactly. If you haven't read about it, Readability (Arc90) has a new subscription model[1]. That's the point of contention. (Not that it's any less stupid.) [1]: https://www.readability.com/learn-more https://www.readability.com/learn-more
- iPhone1 16y ago
  I know about the subscription model; I'm a subscriber.
panacea 16y ago
I could be wrong, but I don't think Apple actually used their technology, but rather implemented a similar feature into desktop Safari.
- maguay 16y ago
  Actually, if you look in the Safari 5 credits, you'll find reference to the original Readability script. Here's the official Readability (arc90) blog post about it: http://blog.arc90.com/2010/06/10/why-we-built-readability/ http://blog.arc90.com/2010/06/10/why-we-built-readability/

jammur 16y ago

I'm fairly quick to defend Apple, because a lot of the flack they take is BS, but in this case I'm really struggling to find the upside. Richard says that their 30% would account for a tiny sliver of Apple's overall revenue, but lots of tiny slivers start to add up eventually. The problem though, is that if the cost of those slivers is to drive the developers away from the App Store, then those slivers disappear. Considering that third party apps are possibly the most important feature of the platform, it doesn't seem like a smart idea. The 30% cut on App sales is understandable, because software generally has high margins, but it doesn't sound like the same is true for content subscriptions. Maybe it's a case of trying to keep their policy too uniform (i.e 30% on everything)? Does anyone know where the subscription content comes from? From my understanding, the subscription content will usually come from a third party, rather than Apple's CDN, so there's no marginal cost to Apple.

EnderMB 16y ago

This may be a stupid comment to make, but one I feel should be added to the conversation. Why are people so willing to develop for Apple when Android is now the larger platform, and has a far easier barrier to entry?

yannickmahe 16y ago
Revenue on iOS devices is far greater than on Android devices: it seems people paying for Apple products are far more eager to pay for apps.
- kenjackson 16y ago
  What about ad revenue? Angry Birds appears to be making more money from Google ads than iOS sales, from what I can tell...
ekanes 16y ago
In part because Android's many devices/configurations make it a less predictable development platform. (I'm not saying there aren't reasons to develop for Android, but you asked for one reason people don't do it more.)
- estel 16y ago
  I'm not sure I've talked to a single Android developer I know, including myself (yes, I talk to myself) that sees fragmentation as a significant difficulty in developing apps. Something to consider whilst developing? Of course (and fundamentally moreso if someone wants to support tablet devices now), but supporting multiple devices is something that Google's made ridiculously easy.
  - robrenaud 16y ago
    A friend of mine develops games for phones professionally, and he says fragmentation and the lack of ability to query the device for what operations it supports and only sell software for the supported hardware is a big problem for him.

Xpirate 16y ago

I wonder if there are anti-trust concerns here.

joshmanders 16y ago

I don't understand why Apple is putting themselves in this situation.. Bad for business. Apple HAD the market, then Google came along with Android, now they're being snobs and just forcing their own users to switch to Android powered phones just because of this exact thing. Shame really.

nika 16y ago

I think it is worth noting, because everyone seems to have forgotten, that this has always been the rule. I remember it from the very first reading of the terms and conditions (back when they were under NDA). It has always been against AppStore rules to monetize apps outside of the AppStore. Apple has been lax in enforcing it, primarily because Apple didn't offer a subscription mechanism. Now they offer a mechanism, and so now people can comply with the rule, and so now they are enforcing it.

dpcan 16y ago
The same thing happens in the Android Market. Apps get removed for policies that have always been there, and then they complain that they exist AFTER they develop the app. READ THE TOS PEOPLE.
ChrisLTD 16y ago
A rule isn't a rule until it's enforced. Apple has effectively changed the rules after tricking companies like Amazon and Netflix to develop software for the App Store, which was – until now – a mutually beneficial arrangement.
- commandar 16y ago
  Wasn't Netflix functionality something Apple used as a selling point for the iPad?

ascendant 16y ago

Through all of this I wonder if they knew there'd be so much angst and now they will "concede" to something like 15% with that being their plan all along. When you make a policy that's really really really bad to then scale it back to just being really bad, people think they're getting a deal.

MartinCron 16y ago

I haven't heard anything about this subscription model and Netflix. Will Netflix be able to continue to provide their iOS apps without giving a cut to apple? Seems crazy that they would have to.

irons 16y ago
Netflix may be exempt, somehow: http://www.businessinsider.com/netflix-not-affected-by-apples-new-subscription-plan-2011-2 http://www.businessinsider.com/netflix-not-affected-by-apple...
- MartinCron 16y ago
  It implies that Amazon could get around this just by removing the "get books" button from their kindle iPhone client, requiring people to make purchases from a browser.

kenjackson 16y ago

DHH, if you're reading, is this what you were talking about?

sacrilicious 16y ago

Believe you me, I want these guys to succeed as much as anyone else, but... wouldn't keeping the payment processing for subscriptions OUTSIDE of the iOS app solve the issue? I must be missing something critical to the functionality of the app? There are no non-profit or even strictly business-related terms under the umbrella of the App Store as far as I know. There are no corporate/business iTunes purchasing accounts, no escalation to root-level privileges allowed for apps in the MacAppStore(postponing backup and other more powerful apps). This seems like another oversight on Apples part due to treating it as a lower priority. And although they have every right to be proud of their achievements, it seems a bit like "you owe me" to remind Apple that they used the Apache-licensed Readability tech for Reader. Their proposed app could stand on its on.

msbarnett 16y ago
> Believe you me, I want these guys to succeed as much as anyone else, but... wouldn't keeping the payment processing for subscriptions OUTSIDE of the iOS app solve the issue? What you're missing is the other rules which force you to offer purchase via IAP because you offer subscriptions outside the app, too. The following terms apply: 11.1 -- Apps that unlock or enable additional features or functionality with mechanisms other than the App Store, except as approved in section 11.13, will be rejected 11.12 -- Apps offering subscriptions must do so using IAP, Apple will share the same 70/30 revenue split with developers for these purchases, as set forth in the Developer Program License Agreement. 11.13 -- Apps can read or play approved content (magazines, newspapers, books, audio, music, video) that is sold outside of the app, for which Apple will not receive any portion of the revenues, provided that the same content is also offered in the app using IAP at the same price or less than it is offered outside the app. This applies to both purchased content and subscriptions. 11.14 -- Apps that link to external mechanisms for purchasing content to be used in the app, such as a “buy" button that goes to a web site to purchase a digital book, will be rejected
lukifer 16y ago
The terms of the App Store expressly forbid offering a subscription payment service which is not also available using Apple's 30% API. That's why people are upset.

damoncali 16y ago

The reason this doesn't work is because Apple had to pick a number - 30%. For some businesses, that makes perfect sense. for others 1% or maybe 70% might make sense. But rigidly adhering to 30% (no doubt because of the massive complexity of the alternative) is going to cut lots of business out just because it doesn't make sense. Apple needs to rethink this - it's clumsy.

foobarbazetc 16y ago
They have to pick 30% because in-app purchases are charged at 30%. You can't have two variations of the same thing (one that auto-renews and one that doesn't) charged differently. Let's say the subscription cut was 10%. Everyone would release their apps as free, and charge for everything as a "subscription" because it's less than the 30% cut for app sales or non-auto renewable in-app purchases. Basically, there is no other percentage that Apple can use here, for very good reasons. If they lower the percentage for this, they have to lower all the other percentages. And that's not going to happen, because 30% is pretty reasonable for what they provide. The Android Market takes 30%, and Amazon takes 70% for Kindle subscriptions. Edit: IMHO, everyone talking about the percentage is missing the point. The problem is the policy itself. It's just too general and broadly applied for a huge amount of stuff out there. Marco nails the issues here: http://www.marco.org/3437484678 http://www.marco.org/3437484678
- damoncali 16y ago
  The way I see it, 30% is not "pretty reasonable". It might be reasonable, it might be a great deal, or it might be a deal killer. It's not much different than if Google were to decide that all AdWords clicks are now $3. The thing is that nobody cared when it was a one time fee for their $1.99 app. When Apple starts talking about subscriptions that may cost 10's or 100's of times that each month, Apple starts to look like their overreaching - and it could be damaging to long term adoption of the platform. One might even hypothesize that these ham fisted policies are defining the very nature of the offerings in the app store - it explains the preference for fart apps over sophisticated (expensive) products. Apple is just coming off as if they didn't think this through.

tel 16y ago

P.S. We’d we be glad to deliver Readability for iOS – with in-app purchasing – if you’d carve out 70% from your 30% fee and share it with writers and publishers, just as we do. This will never happen, but if it did I'd be ecstatic. It could be a great PR move and really help Readability's goals to fund independent content producers online.

T-hawk 16y ago

We don't like it, but Apple's got every allowance and reason to do this. Either Readability will cave to Apple's pricing model, or somebody else will come in with the same technology and do so. Apple believes that the competitive position they have attained allows them to dictate pricing terms. The market will decide whether they are correct. The only argument against Apple that holds water is abuse of monopolistic power, but I don't think that will fly given that the whole market of Android and Windows and other phones also exists.

petercooper 16y ago

My satellite TV provider has an app I can only use if signed up to them. Do they now need to offer TV subscription through their app? What about the 37signals Campfire clients? Do they now need to offer Campfire subs via inapp purchase too?

elehack 16y ago
My understanding is that yes, Apple wants them to.
rimantas 16y ago
Answer to the first one is no, because you don't get their service in the app.
- Bossman 16y ago
  As far as I can tell, Apple's new guidelines wouldn't let them put that app in the App Store anymore. Apple's guidelines say you have to sell through the app using their API and can't sell anywhere else. And you can't link to a place where customers can buy your service outside of Apple's control.
  - diamondsea 16y ago
    They can sell other places, but not promote those other places within the app. They could offer their subscription on their web site and collect 100%. Their app would then be required to offer the same subscription deal as an in-app purchase for the same-or-lower price, and then they would collect 70%. The app could not refer users to their web site for purchases.

jpwagner 16y ago

I think they might have a point, but their ineffective communication style and adversarial tone will surely guarantee they are ignored this time around.

mjfern 16y ago

I posted this to my blog a few days ago, but I think it's worth repeating here because it applies directly to this open letter: While apps and content are just break even businesses for Apple, they are instrumental to the company's financial success. The iPod, iPhone, and iPad are each technology platforms that bring together consumers, apps, and content. The value of each platform (iPod, iPhone, and iPad) to consumers hinges on the availability of apps and content; and the value of each platform to app developers and content publishers hinges on the number of consumers that have adopted the platform. In short, there is a virtuous circle in effect; hardware sales to consumers attract more app developers and content publishers, and more apps and content drive more hardware sales to consumers. Apple’s new subscription model might strain or even break this virtuous circle. First, since Apple is only requesting 30% of revenues if content is subscribed to through iTunes it will likely cause content publishers to encourage consumers to bypass iTunes and purchase content directly. Over time this may reduce the relevance and significance of iTunes. Second, this 30% cut will compel app developers and content publishers to find alternative, less-expensive distribution channels. Google is the natural alternative given Android and the Android Market, and the company has already launched the “One Pass” payment system, which charges a lower fee (10%). If this new subscription model is potentially damaging to Apple’s financial success, then what’s motivating Apple to launch such a model? It’s possible, though very unlikely, that Apple failed to consider the implications of the model and the strain it would place on app developers and content publishers. A second, more likely scenario is that this subscription model reflects efforts by Apple to generate greater revenues and profits from its apps and content business. A third likely scenario is that Apple is trying to create barriers to entry for competing distribution platforms, such as Netflix and Amazon, which will find it cost prohibitive to offer their service through iTunes given the 30% in fees. These barriers may give Apple time to further develop its own content distribution business. The immediate risk that content publishers will turn en masse to Android is low given the delay of Android-based tablets and other connected devices (e.g., connected TVs). This subscription model may boost iTunes revenues and profits, and it may create a barrier to entry for competing distribution platforms, such as Netflix and Amazon. That said, I believe this move is a strategic mistake. There may be some short-term benefits to Apple, but overall it will strain the company’s relationship with app developers and content publishers. Over time this will reduce the selection of apps and content available via iTunes, reducing the value of Apple products to consumers, thus putting downward pressure on hardware sales. In the meantime, partners and resources will migrate away from Apple, towards Android. Over time this will add further energy to Android adoption for app developers, content publishers, consumers, and hardware producers. Android is already emerging as a force in smartphones. With the launch of Motorola’s Xoom and other tablets, Android will soon gain significant share in the tablet market as well.

lwhi 16y ago

I think Apple may have decided to enforce an untenable rule, simply so it can be used as a reasonably large concession when the antitrust machinery slides into gear. If you are going to be required to give up ground - you might as well grab all the ground you can prior to any punitive action.

billswift 16y ago
That sounds like the man who beat his head against the wall; because it felt so good when he quit.
- lwhi 16y ago
  I know what you mean - this scenario sounds quite backwards, but I'm really having quite a lot of trouble understanding why Apple has decided to go ahead with this. If they honestly think they can get away with it, I think this might be a signal that they're losing touch with their community.

OpieCunningham 16y ago

If I understand Readability's issue, it breaks down like this: What they want: For a $1 subscription fee, Readability keeps $0.30 and the publisher/writer of the articles viewed through that $1 sub get $0.70 What Apple requires: For a $1 subscription fee, Apple keeps $0.30, Readability then has the option of keeping $0.30 (30% of $1) or $0.21 (30% of the remainder after Apple's cut) and then the publisher/writer gets either $0.40 or $0.49, respectively. Why does Readability feel they deserve $0.30 but Apple doesn't? If Apple doesn't deserve $0.30, shouldn't the publisher/writer get the full $1? Without the articles, Readability is worthless. Without Apple, Readability for iOS is worthless.

krschultz 16y ago
I think its a little different. Readability has made a contract with the media suppliers: you get 70% of every dollar from the customer. If Apple takes the other 30%, there is 0% left for Readability. If they want to make any kind of revenue for themselves in Apple's system, the only option is to give the content creators a smaller percentage and charge a higher price. It's not really a matter of if Readability deserves 30%, but if Readability deserves any money at all. Apple is basically eating their entire revenue stream.
- frossie 16y ago
  It's actually worse than that. Readability is passing money to publishers for FREE CONTENT. Its model is not a purchase or even a subscription - it is essentially a donation. I don't have to pay to see this content, I choose to. I wonder how this affects the Instapaper "back door" to Readability (which is what I use) I am also wondering where this is goingn to end. Why not ask for 30% off Evernote subscriptions too? Or every cloud accessing iPhone app? This isn't going to end well.
  - OpieCunningham 16y ago
    It's not free content, it's ad supported content. Readability is a service that, among other things and perhaps primarily, removes ads.

ajays 16y ago

I believe what Apple is trying to do is to head off the possibility of being scammed: app writers can give away their apps for free, but unlock the full potential only when you "buy" a (lifetime) subscription. This way the writer can keep 100% of the price of the app, instead of just 70%. Do I agree with Apple? No. But I think this is where they're coming from.

jerome_bent 16y ago
Apple already had measures in place to block that 'loophole' without these new rules—or new interpretations of the rules, if you will. Apple banned an update to ReadItLater, last year, because the reviewer believed the developer was attempting to circumvent the in-app purchase: http://readitlaterlist.com/blog/2010/08/version-2-2-rejected-new-rejection-reason-from-apple-may-have-major-implications/ http://readitlaterlist.com/blog/2010/08/version-2-2-rejected...

nhangen 16y ago

I tend to agree with Apple's right to do this, but I can't tell if it's a genius move or a stupid move. I think this move could further empower Apple, in as much as to put people like Rhapsody out of business. On the other hand, it makes sense to create a hospitable ecosystem, and right now it feels like they are carpet bombing what was once a nice place to hang out. More of my thoughts here (podcast) http://bluerize.com/free-market-anarchy-020-apple-subscription http://bluerize.com/free-market-anarchy-020-apple-subscripti...

nnutter 16y ago

Apple, I bought an iPad because I could watch movies in Netflix and read bookmarks in Instapaper, news in Reeder, and books in Kindle. Please send each $37.50 (30% of the iPad sale shared four ways) to each developer for bringing you a customer. Or, optionally, stop acting like you, as a middle man, provides more added value than the developers that make your platform so damn profitable. P.S. WebOS still looks pretty damn nice.

guelo 16y ago

As a developer I made the decision a few years ago to move away from Apple's platforms because of their capriciousness, their extreme secrecy, and their lack of respect for their developers. I don't know how people invest in their platforms, I'd be constantly scared that Apple would turn around and screw me over.

ChrisLTD 16y ago
The trick is to get in, make your money, and get out before Apple decides it wants in on your territory.

toast76 16y ago

I picked up an iPhone 3GS when they came out with intent of developing iOS apps. Even at that time it was clear that playing in someone else's yard meant playing by their rules, and that it was highly likely that I wasn't going to like their rules. I decided to not make an app. Simple decision really. A lot of developers are now complaining that they're getting burned by what is a reasonably obvious profit motive from Apple. They're not offering an app store because they're good guys. They're offering an app store to make money. They take 30% of purchases. It only makes sense to take 30% of in-app purchases and related subscription services as well. Did anyone honestly believe that apple would fall for the ebay $0.90 purchase with $90 shipping fee-dodging trick? Letting subs through just opens the door for people to ship free apps with subscription "unlocks", thus cutting out Apple. The simple fact is that Apple owns the mountain, and if you want to mine their gold you can expect to pay their taxes. Of course the simple solution is to just build a web app (as these guys have done). Why restrict yourself to Apple's yard and Apple's rules when you can target every device without rules, without restrictions and without a 30% tax? The sooner ever developer realizes this the better off we'll all be.

thought_alarm 16y ago

The App Store does have the potential to drive a massive amount new business for an app like Readability. Apple believes they should be paid for that publishing and marketing service and it's hard to argue about that, particularly when comparing to the relative poor performance of other "app stores." If the App Store fails to bring these developers new business then it doesn't cost the developers anything. If the App Store does bring them new business then it's up to the developers to weigh the cost of the App Store vs. the new business it brings. Is 30% the right price? Ultimately the market will decide that, because if there's one thing this industry doesn't lack, it's competition.

joe_the_user 16y ago

I'm not impressed with anyone here... Readability was trusting enough to release their code with a license which allowed Apple to put the code in their product and then freeze readability's product out of Apple's store. And now the readability folks don't seem inclined to admit their trust was a might miss-placed. But perhaps that's because the readability model is aiming for a kinder, gentler version of Apple's monopoly. They distributed a "product" that reworking website in a manner that steals the original site's advertising revenue. And then they "offer" to give the authors a different revenue source (along with "offering" a lack of choice concerning how their product is presented). Edit: And problem with readability isn't in it just distributing a web-site-rewriter in itself but it doing that AND then asking revenues from content providers...

deleted 16y ago

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jrockway 16y ago

I wish these open letters said, "we are ebaying our iPhones, removing our other apps from the App Store, and switching to Android and Windows Mobile" instead of "we are going to change our business model just because the default icons you guys pick are so great". Apple does not care about whiney letters. They might care if there are no more apps for or users of iOS.

trout 16y ago

I don't understand the legal ownership fuss of their decision. If they had decided to take 5% instead of 30% there would be no discussion here. The only difference between 5% and 30% appears to be whether or not it's a good business decision. It does alienate a number of applications that have less than 30% margin, but that appears to be Apple's motivation. I would not go so far to say this should be expected, but it's a risk you take when you play with a company that likes to own such a large portion of the experience.

devin 16y ago

Avoiding a lot of the discussion here to make a quick but important observation: I suggested in a comment I believe I posted here months ago that Apple would add its "Reader" to the iOS platform. This is a calculated move on Apple's part to make sure that when they deploys Safari Reader for the iPhone it is /their/ idea and not the folks at Readability. Shame, shame, shame. I know you're name.