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Apple Reverses Course On In-App Subscriptions
- dageshi 15y agoI truly don't understand why apple does this, I can only assume its because they have nothing but contempt for the people who develop apps for their platform.
- whiskers 15y agoFirstly this is a positive change (not perfect, but better). But the original rules as stated already in these comments were presumably to see if a) they could get away with it b) to stop people using subscriptions to avoid normal purchases c) to start from the most extreme point to leave room to manoeuvre later
- dageshi 15y agoI'm aware this is a positive change, my point is as a developer it breeds ever increasing uncertainty. Apple introduce draconian changes penciled in to come into effect in four months time, everyone complains about it, they don't say or do anything about it for four months and then quietly change policy a couple of weeks before it comes into effect. I'm not saying apple can't act like that, I'm not saying that it might not be in their own business interests, I am saying that it shows complete contempt for the people developing apps for their platform who have to plan around changes that might or might not come into effect and which might or might not be clarified at some point sooner or later but probably later.
- whiskers 15y agoOn that point we are in complete agreement :)
- burgerbrain 15y agoReversing a negative doesn't yield a positive, it puts you back at neutral. This is only "positive" if you don't include the previous negative that was a massive abuse of their position.
- hullo 15y agoTo play devil's advocate, the original policy was nearly* unambiguously good for users of Apple devices: same content, same price or cheaper, without having to give your payment information to a 3rd party. *with the very large caveat that it drove (and would have continued to drive) competitors out of the market decreasing customer choice & ultimately innovation. It's possible (though, I think, unlikely) that they didn't really know the extent to which this would throw developers large and small into a tizzy. Hence a lot of the confusion about SaaS etc.
- whiskers 15y agoThe key difference between the old policy... "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." ...and the new... "that is subscribed to or purchased outside of the app, as long as there is no button or external link in the app to purchase the approved content. Apple will not receive any portion of the revenues for approved content that is subscribed to or purchased outside of the app" Now it appears that it's fine to show content that is subscribed for outside of the App Store ecosystem (but you may not link directly to your payment pages).
- pseudonym 15y agoI'm pleased that they've made at least this change, but saddened that so many good services that used this functionality have already disappeared.
- whiskers 15y agoYes, it's closing the stable door after the horse has bolted somewhat. Presumably the recent announcements from large media brands (Playboy, FT) of their intention to deliver through webapps has caused this, so we should be thankful to them for this result! I don't understand why they didn't position subscriptions more sensibly from the start - if it had been a 5-10% cut this situation probably wouldn't have happened in the first place.
- paulofisch 15y ago30% would be somewhat defensible if Apple provided the CDN for the content. As they don't, they're taxing convenience and taking it far too high. The 5-10% number holds a lot more water. On the flip side, young upstarts will still lap the system up. Apple has has given them a chance to get one up on old media. The problem is it makes Apple a very large, capricious gorilla in the market.
- nextparadigms 15y agoIt wouldn't be defensible as long as they force them maintain the same price. For some of the companies, 30% of the profit is all they've got, perhaps even more than they've got. The biggest problem with this is Apple wouldn't allow them to increase prices. So Amazon wouldn't be able to sell an e-book for $14 to compensate on iOS, and $10 on their own site.
- dhimes 15y agoMy problem was more about setting restrictions on what I could charge my customer. If the customer wants to pay the premium for buying from the iphone application, fine by me. As far as a "reasonable" fee, I think it should be more in the range of what a credit card charges. young upstarts will still lap the system up I totally agree here. I wonder if it's a viable long-term strategy. In the first wave Apple's store got a bit of a reputation for having a lot of crap in it. But they could be doing the following, which I think would be pretty brilliant: We have a new platform, and a new way of interacting with media and with each other. What is the best use of this? What ideas will be seen as valuable? Well, let's just get as many ideas as we can as cheaply as we can, let the system percolate for a bit and see what is great. When we know what is great, we'll then steer things strongly that way either by (1) building more stuff in-house and relegating indie applications to the cellar, or (2) very tight restrictions on the devs. This amounts to a huge marketing experiment that they make a ton of money from rather than having to spend a ton of money. Brilliant.
- jarin 15y agoEssentially Apple wanted to see if they could get away with being greedy, and when it didn't work out they abandoned it. It's similar to what they've done with app approvals, features, terms of service, signal strength bars, location data, etc.
- whiskers 15y agoI guess it's easier to give people a bit more freedom when the initial rules are causing a lot of bad will than to restrict functionality down the line that people are relying on/used to having.
- jarin 15y agoI forget who it was, but someone said "You can only ever add features, you can never take them away."
- nextparadigms 15y agoSony has learned that lesson very well lately, well hopefully.
- J3L2404 15y agoExcept on HN.
- rubinelli 15y agoRaymond Chen, perhaps? I vaguely remember this quote associated with Microsoft.
- joshwa 15y agoExcept if you're Google. (to wit: recent API retirement)
- deleted 15y ago[deleted]
- jamesbritt 15y ago
- Straubiz 15y agoIs it confirmed?
- whiskers 15y agoYes, I've just logged in to Developer Centre to check and the policy is updated on there.
- warmfuzzykitten 15y agoThis is still there: "Apps that link to external mechanisms for purchases or subscriptions 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" The Kindle app still doesn't conform to this.
- pieter 15y agoThe problem with in-app purchases was always that Apple HAS to use the same 30% fee. If they use another percentage, developers just create free apps and make 'premium' features available for the same price as their paid app would otherwise be, thereby handing over less money to Apple. Because Apple's in-app purchases don't distinguish between features and content, Apple can't use different pricing schemes. I think Apple may try to change this situation with their News Stand system in iOS5. The content appearing there are still normal apps, they're just grouped together in a special folder and feature automatic downloads. My guess is that content purchased in those News Stand apps will be less taxed than other in-app purchases, for example just 10%. That way Apple will keep some of their most important 'partners' happy.
- ashearer 15y agoAren't iTunes gift cards Apple's big constraint? They pose a more difficult problem than developers abandoning paid apps in favor of in-app purchases (which could, as you say, be solved by Apple keeping in-app purchases at 30% outside a narrow app category). Gift card retailers get most or all of the standard 30% cut, as I understand it, leaving Apple with nothing. If that's true there's no way for Apple to withhold less than 30% without either breaking their unified payment system or losing money on each sale. Taking the loss would expose them to massive fraud from collusion between app vendors and retailers. Charging a lower rate for some categories (like News Stand content) without risking losses from gift card arbitrage would mean creating another payment tier where gift card balances didn't work, complicating the model. Can someone with knowledge of the situation confirm whether this is accurate?
- alanfalcon 15y agoI'd also like to see someone with knowledge weigh in. I find it unthinkable that Apple would give more than a 5-10% margin on those gift cards. Retail stores love them despite the small cut because they're pure profit on the books: there's no inventory since they have no value until sold. I think they also get favorable terms on the transfer of cash from the sale of the gift card. This also shows where retailers can be confusing (to me): it takes labor to ship, display, and activate those cards (activation can be a huge pain) but that's all considered fixed overhead I suppose.
- davidedicillo 15y agoI wonder if I can use In-App subscriptions to subscribe to a service instead of content. And, if not, if I can link to the external site.
- MatthewPhillips 15y agoProbably their lawyers got to them. They have a near monopoly in legal music downloads (market share at 70%), so if their app store policies led to Rhapsody or Rdio going out of business it would look pretty bad in the eyes of regulators.
- lurch_mojoff 15y agoI don't know, "near monopoly" doesn't mean anything - 70% or 7%, you either have a leverage over the market and are a monopoly or you don't and aren't. I think it's rather that Apple figured that those two (and others) going out of business (or at least ditching iOS) will hurt their platform more than anything they'll gain from the subscription rule change.
- sylvinus 15y agoLooks like Apple is (successfully?) copying Facebook's policy strategy... Two big steps forward, then one little step backwards!
- Zakuzaa 15y agoFacebook doesn't take any step backwards.
- sigzero 15y agoFacebook doesn't take any steps forward either.
- allenp 15y agoOh really? http://articles.cnn.com/2009-02-18/tech/facebook.reversal_1_facebook-social-networking-site-barry-schnitt?_s=PM:TECH http://articles.cnn.com/2009-02-18/tech/facebook.reversal_1_...
- burgerbrain 15y agohttp://www.mattmckeon.com/facebook-privacy/ http://www.mattmckeon.com/facebook-privacy/ Tell me you can't be serious.
- minalecs 15y agohttp://en.wikipedia.org/wiki/Facebook_Beacon http://en.wikipedia.org/wiki/Facebook_Beacon
- reemrevnivek 15y agoShouldn't that read "two big steps backwards, then one little step forwards"?
- sylvinus 15y agoindeed :)
- cpr 15y agoWhy is everyone assuming Apple's being evil here? Not that they're perfect by any means, but the pattern seems pretty clear: they start off with a restrictive situation, see how it works, and then adjust. (Sometimes they restrict more, then relax; sometimes they stay more restrictive.) They're engaged in a learning process, folks. Nothing quite like the App Store has been attempted before on this scale, and you know they've gotta be rather conservative at each step. You would if you were in their shoes. Yes, they're trying to make money, but I see lots of signs that they're also trying to accommodate the needs of users first, then developers. Never assume malice when it could just be incompetence (i.e., learning from mistakes), etc. (I'm not shilling for Apple. I didn't even attend WWDC this year for the first time in many years. ;-)
- mortenjorck 15y agoThe "same price or less than it is offered outside the app" clause was the part I always imagined to be most likely to set off a DOJ smoke detector. Not surprised to see it go.
- dlikhten 15y agoRight after that e-book competitor shut it's doors (It's been like 3 weeks.) This is how apple kills off competitors. They "experiment", competitors close shop, then they come to their senses and undo the damage. I am surprised Apple is not being brought up on monopoly charges.
- tc7 15y agoWhere are they a monopoly?
- MatthewPhillips 15y agoiTunes music accounts for 70% of legal music downloads.
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- lini 15y agoDoes this mean that people like iFlow (https://www.iflowreader.com/Closing.aspx https://www.iflowreader.com/Closing.aspx) can start selling eBooks again now? Or is it too late for them already?
- kyleslattery 15y agoWell, I'd imagine they still can't sell it in the app, because the agency model means that they have to pay out 70% of the sale price to the publisher. After Apple's 30% cut, that leaves nothing for them. However, it seems as though Apple's ok with apps selling content through a website, as long as it isn't linked to from the app.
- mason55 15y agoThe requirement that in-app purchases be the same price is gone as well, so now they can charge a 30% markup to buy from the iPhone app.
- alanfalcon 15y agoNot under the Agency model where they still owe publishers 70% of the sale and Apple 30% of the sale. If they want a cut, they can only sell from a website, outside the app. They had a flawed business model to egin with in my opinion.
- silverlight 15y agoWow, this could not have come at a better time, since I was just wondering the other day if our companion app to our SaaS offering would be approved. Very pleased to see them reversing their position on this, and further clarifying that even this guideline excludes SaaS subscriptions (which I think is why they specifically spell out audio, video, etc. as the types of content). Thanks, Apple!
- statictype 15y agoI think at that time there was one of those one-word email from Steve Jobs to someone basically clarifying that SaaS subscriptions were not part of that model anyway. Now the whole thing is moot though.
- statictype 15y agoIs it possible that Amazon was playing 'chicken' with the Kindle app, and finally at the last moment, Apple relented and Amazon won? On an episode of The Talkshow, Gruber was speculating that this would come to a head in early June and that something had to happen either way: The Kindle app gets pulled or Apple makes some kind of exception to the rule.
- warmfuzzykitten 15y agoKindle is not a subscription service. The relevant clause would be about in-app purchases. But it wouldn't surprise me that Amazon threatened to pull off the platform, and more power to them. If I were Jeff Bezos I wouldn't be removing any buttons or links from my apps, either.
- recoiledsnake 15y agoNetflix is a subscription service. Apple's been approving Netflix and Kindle updates silently while picking on the small guys because they could, many small guys left the platform in frustration.
- pyre 15y ago> while picking on the small guys because they could Are you suggesting that Apple wasn't approving new updates from smaller players because they didn't follow a policy that wasn't in effect yet?
- recoiledsnake 15y agoYes, that is what Apple was doing.
- m_eiman 15y agoReference?
- deleted 15y ago[deleted]
- guelo 15y agoI don't know how it is you're supposed to build a business on top of Apple's platforms. I'm staying as far away as I can.
- loumf 15y agoApple has paid 2.5 billion to developers -- and that doesn't include other ways of making money on the ecosystem (e.g. writing apps for others) The danger parts are if you are trying to make money in the same way Apple is, or threatening them in some way. Some examples: - if you are going to try to make some kind of significant (30%) affiliate payment as a go-between. (iFlow) - if you try to fill a temporary obvious gap in iOS, that nearly every user would want -- this only works if you can keep out-innovating Apple (if they even allow it). (Instapaper -- but I think he'll out-innovate) - if somehow your app/service gives some advantage to Apple's competitors (AdMob)
- dgeb 15y ago"Apple has paid 2.5 billion to developers" Let's change our perspective here: customers have paid $2.5 billion to developers and $1.1 billion to Apple for apps.
- recoiledsnake 15y agoAnd many still claim that the App Store and iTunes are run at zero profit or a loss. Could that be true?
- ugh 15y agoThey claim that because it’s what Apple CFO Oppenheimer said in February during a shareholder meeting: “We run the App Store just a little over break-even.” Apple makes money by selling hardware with good margins. The App Store and the Music Store help them sell more hardware.
- pdenya 15y agoPlanned the whole time? 1) Apple introduces a strict requirement for using IAP with a deadline 2) All the devs who were planning to comply to keep their apps in the store have likely done the work integrating IAP already 3) Apple reverses policies 4) Devs have the option to drop IAP in their apps but it's not likely that many will IMO
- MatthewPhillips 15y agoWhat does this mean for Readability?
- berberich 15y agoThey said they're going to review their options: https://twitter.com/#!/readability/status/78858529263464448 https://twitter.com/#!/readability/status/78858529263464448
- alecco 15y agoIMHO, they probably freaked out everybody is eyeing HTML5 as a viable cross-platform app alternative.
- hnsmurf 15y agoThe logo certainly makes Apple guilty of a trade dress infringement. This guy will have no shortage of IP attorneys willing to take his case pro bono.
- deleted 15y ago[deleted]
- sambeau 15y agoI would like to point out to people who say that Apple is being greedy: until they came out with their 30% deal it was normal for Phone companies to ban all software from their phones except for their own. When phone companies did include outside developers software, deals of 90%+ were common (as they still are in the games' industry)
- necubi 15y agoThis was never true on the two dominant smart phone platforms, Palm OS and Windows Mobile. Development on the former required only Codewarrior while the latter VS.Net, which became free. Neither Palm nor Microsoft ever required you to pay them money either to develop or release applications, nor did they require approval for those applications to run on devices. You're comparing Apple's smart phone ecosytem against other companies' dumb phone ecosystems. A more reasonable comparison against other smart phone platforms shows that Apple's is unusually restrictive.
- sambeau 15y agoWhen I owned a Palm, software was prohibitively expensive, hard-to-find, buggy and rarely did what it advertised.
- asmosoinio 15y agoActually, virtually all dumb phones allow installation of Mobile Java applications (.jar), and most have no limits on the source of the applications (at least in Europe, I know of some limitations for US carriers and certain devices). Once you can send a link to the installation file to your phone, you are good to go.
- wvenable 15y agoTo add to what necubi said, it wasn't true for Symbian either, so that covers all major smartphone platforms before the iPhone. This "bad all software for their phones" is an oft repeated falsehood that really needs to be stopped.
- 15y ago
- schrototo 15y agoIt makes perfect sense now that they have Newsstand in iOS 5. Netflix, Amazon Kindle, SaaS apps and what-have-you can do what they want subscription-wise and still provide immense value to the platform, while magazines and newspapers will want to be part of Newsstand and will give Apple their 30% without much of a fuss. Everybody wins.
- Qz 15y agoThat is, these apps can't have a "buy" button that takes users to an external subscription page. I can't see how this is good for the user at all.
- codiist 15y agoI think this also has to do with the in-App Patent trouble. Now Apple can say, hey, we did not force you to offer in-App purchase in your app, you can sell your subscriptions just outside the store; in the end, you as the developer of the app are responsible for any resulting legal trouble.