7 ms·

Subscriptions and the new In-App Purchase requirement

122 points by andre3k1 16y ago

toddmorey 16y ago
I really like how he moves the argument from "Does Apple have the right to do this?" to "Should Apple do this?" I'm really surprised: this is what I've always been taught to call bad revenue. I could understand a bit better if they were a struggling startup looking for any possible profitable business model, but they are printing money already. I'm left shaking my head here. Even the folks who often rush to Apple's defense seem to agree this is a mistake. For me, this is the first time that I've looked around Apple's walled garden and wanted out.
- joe_the_user 16y ago
  I'm really surprised: this is what I've always been taught to call bad revenue. Interesting. Do you mean it is more like a move to squeeze the last available dollar out of an existing business rather than a move to grow a business?
  - stanleydrew 16y ago
    I am interpreting it more as revenue that actually ends up indirectly costing you more to obtain than it's worth in the long run, so that you come out net behind. For instance, this App Store policy will bring in revenue but if enough developers and customers leave the ecosystem because of it Apple will end up a net loser.
bradleyland 16y ago
Marco really nailed it. He was also exceptionally level-headed considering that his application, Instapaper, is likely to find itself in exactly the situation he outlines. Marco's plans for Instapaper are based around paid accounts for API access, which would enable third-party apps for paid users. It would be an absolute shame if Marco's app weren't allowed on iOS. Quite honestly, if Instapaper, Dropbox, and Evernote are under threat to be removed from the App Store, I won't even consider a new iPhone until Apple revises its policy.
- runevault 16y ago
  I wonder if you'll see under the table deals where 3rd parties write apps for these services FOR the company to bypass the restriction, assuming 3rd party apps are still allowed by Apple's new policy.
  - schwabacher 16y ago
    I hadn't thought about it, but this is what they should do.
    - bradleyland 16y ago
      That would be a horrible business decision, in my opinion. "Under the table" deal is just another way of saying "violating the agreement I signed". Two wrongs don't make a right, etc, etc. But more importantly, operating in the background would just enable Apple. Cutting Apple out of the revenue won't really hurt them, but it will increase dependence on their platform, which gives them more leverage. Under the table deals would be extremely short sighted and dishonest.
      - schwabacher 16y ago
        Yeah, I think you are right.. I was commenting on the third party part more than the under the table part. I was thinking more along the lines of Amazon creating an open or liscensed API for it's ebooks, so that someone can make an app for me to log into and read books that I own. Users could still read their kindle books on their iphones, and amazon could keep it's position as the best book store for iOS users, expand to other devices, etc.. I don't think it is worth it for someone like Amazon or Pandora to stay off of Apple's platform just to give them less leverage, but I agree that they would have to be upfront about it.
- starnix17 16y ago
  Even more level-headed when you consider that the Readability app that was rejected today was written by him along with the fact that he's an advisor for the company.
hamrickdavid 16y ago
I think one very interesting case is services like directv, dish networks, comcast, tivo etc. They all offer services but their apps are ancillary to the subscription service that they provide. Does Apple want Directv to offer subscriptions within the app?
- extension 16y ago
  Only if the content being paid for is delivered through the app. If the app is just something like a remote control or a channel guide then I'm guessing Apple would let it slide.
  - treblig 16y ago
    It's exactly this issue though. Where's the line on what Apple will "let slide"? When is something part of the core service of a product?
mcritz 16y ago
Marco’s analysis is sane & pursuasive. It's a much better response than the Readability team’s rant. Clear heads will win this fight.
- lukifer 16y ago
  Will they? Many App Store absurdities have been resolved through the squeaky wheels getting the grease.
  - Vivtek 16y ago
    Maybe it's a planned double-whammy.
jasonjei 16y ago
Is it interesting timing that in-app subscription rollout is happening as Steve Jobs is taking a step back? I wonder if this says anything about the potential PR fallout to happen that Steve would handle better than most others just as he did when the iPhone prices were lowered.
- mikeklaas 16y ago
  Considering the main press release quotes Jobs[1], this is unlikely. [1] “Our philosophy is simple—when Apple brings a new subscriber to the app, Apple earns a 30 percent share; when the publisher brings an existing or new subscriber to the app, the publisher keeps 100 percent and Apple earns nothing.”
  - zach 16y ago
    Except that Steve's quote is a good argument for the conservative interpretation, which says that if you don't use an iOS app as advertisement for non-App Store payment, nothing changes. Because to me it seems like there's no necessary IAP option implied and if the publisher isn't using Apple's means (including the iOS platform itself), it keeps its 100%. That battle of interpretations rages on, unless I've heard different. It looks like Marco is taking the liberal interpretation (apps must accept IAP as a form of payment for any services they offer). It seems to me this is the underlying debate.
- johns 16y ago
  I think it's a pretty safe bet he's involved in this decision.
quan 16y ago
I agree with all the points except for the one that believes it's within Apple right to do whatever they want because it's their hardware and platform. Let's forget that the hardware really belongs to the iPhone/iPad owners for a moment, but if it's defensible because it's their platform then it's more reasonable for Verizon, AT&T, and Comcast to take a cut from all sales and profits happened via their network. It's their platforms, which took them decades to build. And surely there's value added when they offer preferentially faster speed and more secured transaction to whichever companies agree to pay them. It would be hilarious if an ISP starts demanding 30% cut from every sale Apple makes that originates from their network.
- joe_the_user 16y ago
  Ah, And then every ISP will demand a cut of every sale that happens on the Internet part of their network. Finally, the telecos implement some good natural language processing and demand a cut of every sale you negotiate over their voice network... ...Their network, their rules... ... that will work well till the Oxygen cartel starts making demands....
  - rimantas 16y ago
    > And then every ISP will demand a cut of every sale that > happens on the Internet part of their network. And then Apple will start collecting monthly fee just because you have iDevice.
  - wladimir 16y ago
    Indeed. Whatever happened to "With the internet, we can cut out the middlemen"? Suddenly, every corporation wants to set up tollboothes along the way and starts demanding their cut. If this continues, in small steps, we'll be back at the old way, in which the content creator gets only a minimal share of the pie, and it's the distributors that get rich. I'm all for an open, "flat", neutral infrastructure, so there is no way I'll be buying any Apple products.
Terry_B 16y ago
Just so I've got this clear.. If I develop an enterprise ipad application and track down the customers myself, it is possible to sell to them and take 100% of the revenue still? I can do this by offering the app for free on the app store and requiring activation through my own external signup system. However, I must also offer the option to sign up using Apple's API and Apple taking 30%? I just need to be on the phone to the customer when they download the app and ask them politely to not use the Apple method?
- scrod 16y ago
  Why ask them? Just price the Apple-payment-system version 30% higher than your own and let customers see the difference.
  - arn 16y ago
    You can't do this. Apple states you must price it the same.
    - oscardelben 16y ago
      Or lower.
    - scrod 16y ago
      Oh, too bad then.
  - deleted 16y ago
    [deleted]
  - mdemare 16y ago
    Apple does not allow that.
  - pieter 16y ago
    Also, you'd have to increase the price by 43% to account for Apple's cut.
- greyman 16y ago
endtwist 16y ago
What's going to be interesting to me, now, is whether or not this will cause developers (more specifically, service and not game developers) to start to look more seriously at web-only apps, as opposed to native. You're thinking, "the performance of web apps doesn't at all compare to native apps," and you're (mostly) right. Web apps tend to feel a bit slower and less responsive. But if we can get one "hero" (i.e., popular web-only app) then people will learn to accept/ignore that the performance isn't quite the same as what they get when they download an app — and that would be good for the whole mobile web ecosystem. And, of course, as mobile browsers (fairly quickly) advance, the performance will increase significantly and the difference will be less noticeable.
- mikeklaas 16y ago
  The problem isn't the performance of mobile apps. We're about to release an ipad app that could've easily been a webapp—it is 90% implemented via javascript+HTML, animated with CSS transitions, all in a UIWebView controller. We do a lot of app-side caching, but I think a sufficiently-motivated javascript dev could do something similar. The problem is that by not making it a native app, you're cutting yourself off from "the way people get apps" for their devices. The app store is a distribution mechanism that just can't be ignored by a serious mobile developer.
- CJefferson 16y ago
  My biggest problem with web-only apps is that in many places in the UK, if I am travelling by bus, train or plane, I will only get intermitant access to the web. I refuse to use any system where I can't get access to my data without a speed internet connection.
kevinburke 16y ago
Marco didn't mention the possibility that more people would begin to jailbreak their phones and use Cydia or another site, where Apple can't control the applications on offer. Am I underestimating the difficulty of jailbreaking an iPhone and setting that up?
- joebananas 16y ago
  You're overestimating peoples inclination to fuck around with cruddy hacks. The vast, vast number of iPhone users aren't nerds, and have no desire to become nerds.

122 points by andre3k1 16y ago

I really like how he moves the argument from "Does Apple have the right to do this?" to "Should Apple do this?" I'm really surprised: this is what I've always been taught to call bad revenue. I could understand a bit better if they were a struggling startup looking for any possible profitable business model, but they are printing money already. I'm left shaking my head here. Even the folks who often rush to Apple's defense seem to agree this is a mistake. For me, this is the first time that I've looked around Apple's walled garden and wanted out.

joe_the_user 16y ago
I'm really surprised: this is what I've always been taught to call bad revenue. Interesting. Do you mean it is more like a move to squeeze the last available dollar out of an existing business rather than a move to grow a business?
- stanleydrew 16y ago
  I am interpreting it more as revenue that actually ends up indirectly costing you more to obtain than it's worth in the long run, so that you come out net behind. For instance, this App Store policy will bring in revenue but if enough developers and customers leave the ecosystem because of it Apple will end up a net loser.

bradleyland 16y ago

Marco really nailed it. He was also exceptionally level-headed considering that his application, Instapaper, is likely to find itself in exactly the situation he outlines. Marco's plans for Instapaper are based around paid accounts for API access, which would enable third-party apps for paid users. It would be an absolute shame if Marco's app weren't allowed on iOS. Quite honestly, if Instapaper, Dropbox, and Evernote are under threat to be removed from the App Store, I won't even consider a new iPhone until Apple revises its policy.

runevault 16y ago
I wonder if you'll see under the table deals where 3rd parties write apps for these services FOR the company to bypass the restriction, assuming 3rd party apps are still allowed by Apple's new policy.
- schwabacher 16y ago
  I hadn't thought about it, but this is what they should do.
  - bradleyland 16y ago
    That would be a horrible business decision, in my opinion. "Under the table" deal is just another way of saying "violating the agreement I signed". Two wrongs don't make a right, etc, etc. But more importantly, operating in the background would just enable Apple. Cutting Apple out of the revenue won't really hurt them, but it will increase dependence on their platform, which gives them more leverage. Under the table deals would be extremely short sighted and dishonest.
    - schwabacher 16y ago
      Yeah, I think you are right.. I was commenting on the third party part more than the under the table part. I was thinking more along the lines of Amazon creating an open or liscensed API for it's ebooks, so that someone can make an app for me to log into and read books that I own. Users could still read their kindle books on their iphones, and amazon could keep it's position as the best book store for iOS users, expand to other devices, etc.. I don't think it is worth it for someone like Amazon or Pandora to stay off of Apple's platform just to give them less leverage, but I agree that they would have to be upfront about it.
starnix17 16y ago
Even more level-headed when you consider that the Readability app that was rejected today was written by him along with the fact that he's an advisor for the company.

hamrickdavid 16y ago

I think one very interesting case is services like directv, dish networks, comcast, tivo etc. They all offer services but their apps are ancillary to the subscription service that they provide. Does Apple want Directv to offer subscriptions within the app?

extension 16y ago
Only if the content being paid for is delivered through the app. If the app is just something like a remote control or a channel guide then I'm guessing Apple would let it slide.
- treblig 16y ago
  It's exactly this issue though. Where's the line on what Apple will "let slide"? When is something part of the core service of a product?

mcritz 16y ago

Marco’s analysis is sane & pursuasive. It's a much better response than the Readability team’s rant. Clear heads will win this fight.

lukifer 16y ago
Will they? Many App Store absurdities have been resolved through the squeaky wheels getting the grease.
- Vivtek 16y ago
  Maybe it's a planned double-whammy.

jasonjei 16y ago

Is it interesting timing that in-app subscription rollout is happening as Steve Jobs is taking a step back? I wonder if this says anything about the potential PR fallout to happen that Steve would handle better than most others just as he did when the iPhone prices were lowered.

mikeklaas 16y ago
Considering the main press release quotes Jobs[1], this is unlikely. [1] “Our philosophy is simple—when Apple brings a new subscriber to the app, Apple earns a 30 percent share; when the publisher brings an existing or new subscriber to the app, the publisher keeps 100 percent and Apple earns nothing.”
- zach 16y ago
  Except that Steve's quote is a good argument for the conservative interpretation, which says that if you don't use an iOS app as advertisement for non-App Store payment, nothing changes. Because to me it seems like there's no necessary IAP option implied and if the publisher isn't using Apple's means (including the iOS platform itself), it keeps its 100%. That battle of interpretations rages on, unless I've heard different. It looks like Marco is taking the liberal interpretation (apps must accept IAP as a form of payment for any services they offer). It seems to me this is the underlying debate.
johns 16y ago
I think it's a pretty safe bet he's involved in this decision.

quan 16y ago

I agree with all the points except for the one that believes it's within Apple right to do whatever they want because it's their hardware and platform. Let's forget that the hardware really belongs to the iPhone/iPad owners for a moment, but if it's defensible because it's their platform then it's more reasonable for Verizon, AT&T, and Comcast to take a cut from all sales and profits happened via their network. It's their platforms, which took them decades to build. And surely there's value added when they offer preferentially faster speed and more secured transaction to whichever companies agree to pay them. It would be hilarious if an ISP starts demanding 30% cut from every sale Apple makes that originates from their network.

joe_the_user 16y ago
Ah, And then every ISP will demand a cut of every sale that happens on the Internet part of their network. Finally, the telecos implement some good natural language processing and demand a cut of every sale you negotiate over their voice network... ...Their network, their rules... ... that will work well till the Oxygen cartel starts making demands....
- rimantas 16y ago
  > And then every ISP will demand a cut of every sale that > happens on the Internet part of their network. And then Apple will start collecting monthly fee just because you have iDevice.
- wladimir 16y ago
  Indeed. Whatever happened to "With the internet, we can cut out the middlemen"? Suddenly, every corporation wants to set up tollboothes along the way and starts demanding their cut. If this continues, in small steps, we'll be back at the old way, in which the content creator gets only a minimal share of the pie, and it's the distributors that get rich. I'm all for an open, "flat", neutral infrastructure, so there is no way I'll be buying any Apple products.

Terry_B 16y ago

Just so I've got this clear.. If I develop an enterprise ipad application and track down the customers myself, it is possible to sell to them and take 100% of the revenue still? I can do this by offering the app for free on the app store and requiring activation through my own external signup system. However, I must also offer the option to sign up using Apple's API and Apple taking 30%? I just need to be on the phone to the customer when they download the app and ask them politely to not use the Apple method?

scrod 16y ago
Why ask them? Just price the Apple-payment-system version 30% higher than your own and let customers see the difference.
- arn 16y ago
  You can't do this. Apple states you must price it the same.
  - oscardelben 16y ago
    Or lower.
  - scrod 16y ago
    Oh, too bad then.
- deleted 16y ago
  [deleted]
- mdemare 16y ago
  Apple does not allow that.
- pieter 16y ago
  Also, you'd have to increase the price by 43% to account for Apple's cut.
greyman 16y ago

endtwist 16y ago

What's going to be interesting to me, now, is whether or not this will cause developers (more specifically, service and not game developers) to start to look more seriously at web-only apps, as opposed to native. You're thinking, "the performance of web apps doesn't at all compare to native apps," and you're (mostly) right. Web apps tend to feel a bit slower and less responsive. But if we can get one "hero" (i.e., popular web-only app) then people will learn to accept/ignore that the performance isn't quite the same as what they get when they download an app — and that would be good for the whole mobile web ecosystem. And, of course, as mobile browsers (fairly quickly) advance, the performance will increase significantly and the difference will be less noticeable.

mikeklaas 16y ago
The problem isn't the performance of mobile apps. We're about to release an ipad app that could've easily been a webapp—it is 90% implemented via javascript+HTML, animated with CSS transitions, all in a UIWebView controller. We do a lot of app-side caching, but I think a sufficiently-motivated javascript dev could do something similar. The problem is that by not making it a native app, you're cutting yourself off from "the way people get apps" for their devices. The app store is a distribution mechanism that just can't be ignored by a serious mobile developer.
CJefferson 16y ago
My biggest problem with web-only apps is that in many places in the UK, if I am travelling by bus, train or plane, I will only get intermitant access to the web. I refuse to use any system where I can't get access to my data without a speed internet connection.

kevinburke 16y ago

Marco didn't mention the possibility that more people would begin to jailbreak their phones and use Cydia or another site, where Apple can't control the applications on offer. Am I underestimating the difficulty of jailbreaking an iPhone and setting that up?

joebananas 16y ago
You're overestimating peoples inclination to fuck around with cruddy hacks. The vast, vast number of iPhone users aren't nerds, and have no desire to become nerds.