Apple's 30 per cent content fee issue of contention
Apple’s recently released in-app subscription services has come under fire from regulators as the company’s 30 per cent take of profits causes publishers to raise prices.
Whilst Apple has always taken a hefty chunk of App download fees, the company’s latest move into in-app content has become the target of anti-trust regulators in the US and Europe as publishers wishing to distribute iPhone and iPad-bound electronic versions of their printed media are told they will have to fork over a third of all profits.
Prior to the introduction of Apple’s in-app subs service, launched alongside the arrival of The Daily, the first iPad-centric newspaper, publishers were able to link users to content purchases within a web browser, surpassing the need for the Apple sales platform and retaining their profits. However, as of June 30th such links will be banned from apps supplied through the Apple App Store.
Discussing the changes to Apple’s publishing limitations at a meeting of around 60 leading European publishers last week, the International Newspaper Marketing Association announced: "Publishers simply can't afford to invest in new technology, products and services when the platform charges them 30% of total revenue."
Defending its new terms as a business model beneficial to all parties, Apple CEO Steve Jobs formerly describing the subscriptions services said: "We believe that this innovative subscription service will provide publishers with a brand new opportunity to expand digital access to their content onto the iPad, iPod touch and iPhone."
Talking with the BBC, industry analyst from Forrester Research, James McQuivey, said of Apple’s planned publishing charges: "Taking a 30% toll amounts to a massive increase in the cost basis of a content business that will kill it.” He added: "In the end, Apple envisions a world in which people don't consume any kind of digital media without its help.”
T3 last week became one of the first publishers to offer the iPad-enhanced edition of T3 Magazine to consumers via Apple’s new in-app subscription service. Available to download here and with a free preview issue followed by single issues purchasable for £2.99 a piece, T3’s new subs offers allow users to pick up three digital copies for just £5.99. Six issue and 12 issue subscriptions are also available priced £11.99 and £23.99 respectively.
What do you think of Apple’s new in-app subscription services and the charges to be implemented on publishers looking to make their digital content available via the system? Let us know your thoughts via the T3 Twitter and Facebook feeds.
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