Posts tagged iOS

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Apple revises in-app purchase policy for the iOS App Store

I’ve been an outspoken critic of Apple’s strict policy on in-app purchases and subscriptions, which was to require all content available for an app to be offered through Apple’s in-app purchase system, with Apple taking a 30% cut. Furthermore, prices were required to be set at equal to or less than those of the same item outside the app (like content available from a publisher’s website). So I was happy to see that Apple recently revised its stance, allowing purchased or subscribed content to be read by an app without it being offered through the in-app purchase system. However, all in-app purchases must still go through Apple’s system, and buttons or links to purchase content in any other way are not allowed. The relevant section of the App Store Review Guidelines now reads:

Apps can read or play approved content (specifically magazines, newspapers, books, audio, music, and video) 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

While this is an improvement, I still contend that a nonnegotiable 30% fee, regardless of the type of app and type of purchase or subscription, is draconian and anticompetitive. It excludes companies that rely on a margin of profit below 30%, like eBook sellers and music subscriptions services, from using Apple’s in-app purchase system.

The fee was recently blamed by BeamItDown Software for leading them to shut down their company and discontinue their iOS-exclusive eBook app, iFlow Reader. In an interview with CNET, the company’s co-founder Dennis Morin said, “the In-App Purchase model makes it impossible to comply with the requirements of the [eBook] agency model, which was created by Apple.” While using the in-app purchase system is no longer mandatory, much of the complaints leveled at Apple by Morin and BeamItDown Software still stand. Besides, certain apps should not be excluded from taking advantage of in-app purchases (which forces them to build beyond the iOS ecosystem) only because they can’t afford to give up almost a third of their revenue. iFlow Reader co-founder Philip Huber says the revised policy doesn’t change the plight of his company:

Apple still prohibits us (or anyone else) from having an in-app bookstore without giving Apple 30%. Apple also still prohibits anyone from providing a Buy button or even a link from our app to bring up Safari in any convenient way to purchase content.

Apple has (warning: sarcasm ahead) graciously allowed applications to read content purchased elsewhere. That works fine for the big companies like Amazon and Google who started with a web presence and most people already purchase that content on the web.

For a small company like ours, we foolishly built our sales platform on Apple thinking that most people would prefer to buy either from their device or computer. Apple knows this all too well, which is why they’re restricting convenient ebook purchases on your devices to be made within iBooks. This is pure and simple greed on Apple’s part. Their PR department can and will spin this, but the harsh reality is that the eviction notice is still effective.

Filed under Apple iOS iOS App Store

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30% across-the-board is too much

Apple’s policy of taking a 30% cut from every in-app transaction in iOS apps was recently thrust into the spotlight due to its effect on BeamItDown Software and their iFlow Reader app. Some, like John Gruber and Ben Brooks, seem to have no sympathy for the plight of companies and services that can’t afford to continue doing business on the app store. That’s the nature of the game, says John — “tough noogies.”

The problem is, this isn’t a small fee. It not 5% or 10%. It’s 30%, almost a third of all revenue. Not profit, revenue. And this isn’t an independent store that needs to make a lot on each transaction. With an economy of scale like the App Store, Apple could make significant profit with a fee of only a few percent.

On the other hand, many of the apps in the App Store are from small independent companies, which can’t afford 30% with every single transaction. The problem is that it’s 30% across-the-board, regardless of the type of app, the type of subscription, etc. 30% may make sense for some apps, but certainly not for all, like those that distribute others’ content and therefore don’t have as much control over the pricing. Otherwise, the kind of apps that can afford to be on the App Store will continue to be restricted, with eBook sellers, music subscriptions services, and others being excluded unless they can cut a deal with Apple.

This is not the environment Apple should want to create for developers and companies. It doesn’t promote trust, nor does it encourage companies to make the App Store their primary market.

Filed under App Store iOS Ben Brooks John Gruber Apple

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On iFlow Reader getting “screwed”: Apple’s policy is bad for users

BeamItDown Software recently announced that their iOS eBook app iFlow Reader will be discontinued, and the company will be shutting down. The stated reason for this is Apple’s policy, implemented this year, that in-app purchases must go through their system, with a 30% fee (which is more than eBook sellers can generally afford to give up). Ben Brooks thinks the effect on BeamItDown Software and iFlow Reader is justified by an evolving market:

It sucks that iFlow can’t figure out an alternative, but it’s not Apple’s job to help iFlow run their business.

That’s true, but it is Apple’s job to support the app ecosystem they’ve created. That doesn’t mean they’re required to cater to every app’s specific model, but changing a policy, when it negatively affects some app publishers so directly, is inconsiderate and anticompetitive (especially since any eBook seller is a direct competitor to Apple, due to iBooks).

To add insult to injury, Ben thinks that iFlow screwed themselves by investing solely in Apple’s platform:

So iFlow, Apple didn’t screw you — you screwed yourselves. Linking your success to being able to sell one app in one market screwed you and it can and will happen to others.

It’s true that it’s a often bad idea to put all your eggs in one basket. This is especially true with networks, like Twitter. But with iOS and the App Store, Apple wants people to make it their exclusive market. Apple wants people to be building and selling only for iOS (and Mac OS X). Is The Daily “screwing itself” by relying entirely on Apple’s platform? Oh right — they’ve got a special deal with Apple. Is that what it’ll take to succeed on the App Store? Or at least, to feel safe that your business model is sustainable? Maybe that’s what Apple wants.

But it’s certainly not fair, and it doesn’t set a very good precedent for future companies deciding where to focus. If Apple wants their closed App Stores to be the best sources of software and services (and it seems they do), developers need to be assured that their business model won’t be pulled out from under them. It’s certainly Apple’s right, but it’s not necessary, and it doesn’t promote innovation, risk-taking, or exclusivity on their platform, or trust among developers (and users).

Furthermore, since Apple requires that the App Store price be equal to or lower than outside prices, even if developers rely on multiple platforms and multiple markets, this still puts them in a situation where, if they choose to remain on Apple’s platform, they need to raise prices outside the store as well. Apple’s policy doesn’t just require companies that can’t currently afford 30% to shift their App Store strategy, but their entire pricing strategy. Whatever the fairness of this, it’s undoubtedly bad for the users.1

This may be one of the first casualties of Apple’s draconian policy, but it won’t be the last. A nonnegotiable 30% cut on all in-app purchases is bad for developers, bad for competition, and worst of all, bad for users.


  1. When this policy was first announced, John Gruber wrote, “if this subscription policy knocks a bunch of good apps out of the store, sure, that’ll be bad for iOS users.” This is only one, but as Ben predicts, it “will happen to others.” 

Filed under Apple iOS iPhone App Store Apps Ben Brooks policy

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Five Mac Apps to Watch in 2011

2010 was the year I fell in love with apps all over again. I got a Macbook Pro near the end of 2009, giving me a chance to finally pull the plug on my dying iMac G5, and start from scratch with an almost empty Applications folder. While hype in 2010 may have been dominated by iOS apps and HTML5, Mac OS X app development continued as usual. It was as good a year as any to re-discover the beauty of the desktop app. With the launch of the Mac App Store coming tomorrow, 2011 will be off to a good start, and it’s likely to be an even better year than the last for Mac OS X. The Mac App Store will likely bring a new round of apps and a new wave of eager developers, but I’ll be just as interested in watching some of my favorite apps improve as I will be in discovering new ones. With that in mind, here are five apps for which 2011 should be a significant year.

LibreOffice
In September 2010, The Document Foundation was announced, to foster a truly open and independent alternative to Microsoft Office. LibreOffice was simultaneously released, and while in its current form it’s basically a re-branding of OpenOffice.org, The Document Foundation promises an exciting future with a focus on content and the document itself. “The Document Foundation founders foresee a completely different future for the office suite paradigm,” read an e-mail from November, “each single module of LibreOffice will be undergoing an extensive rewrite… Most of the new features are either meant to maintain compatibility with the market leading office suite or will introduce radical innovations.” LibreOffice is the logical evolution of OpenOffice.org. While a lot of progress has already been made in the past few months, 2011 will be the year that The Document Foundation finds its footing, and LibreOffice gets a chance to fulfill its potential as a re-invigorated and truly independent alternative to Microsoft Office.

Plex
2010 saw the release of Plex/Nine, a long-awaited update featuring a restructured library system allowing for advanced features and greater control, as well as more independence from XBMC, Plex’s original source. Apps for the iPod Touch, iPhone and iPad were also released. I’ve already said that Plex is the best media manager out there, and with the developers now working on it full time, a deal with LG Electronics, and an upcoming Windows version, 2011 should be a good year for Plex. I won’t be surprised if this is the year it finally reaches 1.0.

Sparrow
Mail client Sparrow has only been out for three months, but it’s already been downloaded over 150,000 times and become one of my most used apps. Development has been quick (it’s on beta 7), the developers are very responsive to feedback (on Get Satisfaction), and Sparrow continues to improve with each beta. Sparrow is one of the first apps in what will surely become a trend: an iOS-inspired interface for a desktop app (see also: Reeder, below). The developers have promised support for IMAP in 2011, making Sparrow not just an incredible Gmail app but a viable replacement for other mail clients.

Reeder (beta for Mac OS X)
The beta for the frequently lauded iPhone/iPad app Reeder was recently released for Mac OS X, to near universally positive reception. Reeder is another app that seems built for iOS but nonetheless right at home on Mac OS X. Considering the excitement surrounding even such an early beta, expect Reeder’s popularity to increase in 2011, especially with the Mac App Store and a more complete release.

Bodega
An official Mac App Store might seem like a death sentence to an independent one, but I think Bodega can survive. That doesn’t mean it’ll be easy: Apple has the marketing dollars and exposure to get attention, the dominance to attract developers and users (which populate the reviews, making it more valuable for discovery), a powerful position of interest to bloggers and others in the media (there have already been more stories about the Mac App Store, even before it’s released, than Bodega, which has been around for over a year), and with the Mac App Store coming pre-installed with Lion, a guaranteed user base. However, I see the Mac App Store as an opportunity for Bodega. Bodega provides an open alternative to Apple’s restrictive policies, as well as a much more fair revenue split with developers (Bodega keeps only 7%). Aside from illegal and highly offensive apps, Bodega will accept everything, a stark contrast to Apple’s Mac App Store. A list of benefits for developers appears on Bodega’s site, and it’s easy to see why it would be more attractive than the official store. The most important factor is potential customers, of which Apple will absolutely provide more, but there will also certainly be demand for an alternative Mac App Store, and Bodega will be there to fill the void. Increased publicity around Mac OS X apps and App Stores is good for everyone involved, including — and especially — Bodega. “Bodega is not going anywhere,” Bodega’s Phil Letourneau told The Loop, “It will continue to grow in terms of developers and customers coming into Bodega.” I’m very excited to see what this next year holds for the original “corner store for Mac apps.”

Filed under mac os x mac apple mac app store Mac App Store apps software 2011 list LibreOffice The Document Foundation Plex Sparrow Reeder Bodega iOS