As I write this, Apple is embroiled in controversy over the iOS-app subscription rules it imposed in February. All may have been made clear by the time you read this, but odds are that discord will still roil the app-mosphere.
Not every developer is distressed by Apple’s decision to require all iOS apps that sell subscriptions to do so through Apple’s in-app purchase (IAP) system. For some, the ability to attract 160 million–plus pairs of iOS device–focused eyeballs is a dream come true.
Others, however, see Cupertino’s decree as a business-squashing app-ocalypse. Still others are simply befuddled as to whether their apps run afoul of this new world order. In addition, the U.S. Federal Trade Commission and Department of Justice are reportedly pondering antitrust investigations, and the European Union is “carefully monitoring the situation.” The pot is bubbling.
The basics: as of June 30, Apple won’t allow an iOS app that sells “content or subscriptions” to link to a developer’s website to make a purchase. Instead, such sales will have to be made through IAP, and Apple will take a 30 percent cut. Developers will still be allowed to sell the same content on their websites, but only at the same price or less.
For publications such as Rupert Murdoch’s lamentably lightweight The Daily, the policy provides both one-tap shopping and the underpinnings of a solid business plan. For music-subscription services such as Rhapsody, Last.fm, Rdio, and others—which operate with razor-thin margins—that 30 percent cut is a death blow.
And then there’s the murky question of apps that provide subscriptions to software-as-a-service, or SaaS. An email purportedly sent by Steve Jobs to one such developer—“We created subscriptions for publishing apps, not SaaS apps”—indicated that such apps were off the hook. But one developer, Readability, had its eponymous service-providing app rejected for violating the guidelines. Readability allows you to strip a website of ads so that it can be more easily read as plain text. So does Safari’s Reader feature, which uses the same open-source code that Readability’s parent developed. An argument could be made that by cleansing websites, Readability provides content, not service—but it’d be a weak argument.
And what about other SaaS-y apps such as Salesforce, Box.net, Dropbox, and the like? Will they be required to give Apple a 30 percent cut of any services they sell through the App Store? Maybe not today, but how about in the future, should Apple so decide? Box.net’s CEO says he’s “watching this situation very closely.” Some music subscription–app developers have spoken out. Rhapsody’s president calls the 30 percent cut “economically untenable” and says he’ll yank his app from the App Store unless Apple changes its policy. Last.fm’s former CTO was less politic: “Apple just f**ked over online music subs for the iPhone,” he wrote in an IRC chat message.
Of course, Apple has every right to set the rules for those who want to benefit from planting their flowers in its phenomenally successful walled garden. If developers don’t want to follow Cupertino’s rules, they’re perfectly free to stay outside that garden’s well-defended walls.
Although Apple owes its iOS developers nothing—well, other than 70 percent—it must see that its iOS advantage is being whittled away by Google’s Android, HP/Palm’s webOS, and the BlackBerry PlayBook’s QNX—and Intel’s MeeGo is waiting in the wings. And it knows that developers have provided it with a powerful first-mover advantage in the mobile market by swelling the contents of the iOS App Store to well over 350,000 apps.
Steve Jobs might want to remember the old adage: dance with the ones that brung ya.
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Since the late 1980s, Rik Myslewski has paid his rent by keeping an eye on Apple. He was editor-in-chief of MacAddict from 2001 until its transformation into Mac|Life in early 2007, and is now a member of the snarkily sophisticated team at London’s The Register, which is “biting the hand that feeds IT” daily at www.theregister.co.uk.
