A Tale of Two Subscriptions

On Wednesday, Apple announced some new requirements for its App Store regarding subscription based services. The change was brought on by the growth of magazines and cloud-based services, like Rhapsody, who we’ll get to in a minute. The change was not much of a shock due to the Sony Reader app being denied from the App Store earlier this month. Apple informed Sony that it could no longer offer access to content that was purchased from outside the app. This was just another chapter in the long book of inconsistent App Store rejections.

The new subscription plans require Apple get 30% of in-app subscriptions, the same percentage they get from app purchases in the first place. They also require app makers to either allow for users to subscribe in-app, instead of linking them to the web to do so. The other requirement is that content makers/deliverers must charge the same price in the app as they do anywhere else. This prevents a mark-up to recoup any loss in profit from Apple’s cut.

Now, none of these changes might directly affect the user, but they might still feel the sting of it. Apple not allowing any mark-up on the content directly takes a cut of the developer’s profit has not made them any friends. Rhapsody, the largest music streaming service, came out against the new requirements, saying that it would no longer make financial for them since they have to pay royalties to record companies already. The change that will effect users is a scary one. Apple is also demanding that companies share their subscriber data, giving Apple even more personal data about their customers.

Always with the good timing, Google took this opportunity to unveil their new service, One Pass. One Pass not only allows content distributors to keep their customers’ data to themselves, it also only takes 10% of revenue from the subscription. It makes for a much better deal for companies, keeping online subscriptions low. As far as users are concerned, One Pass will also make the content they care about device nonspecific. The same article can be viewed from any computer, phone, or tablet. They will be able to view the articles from multiple sources with a single login. Whether or not One Pass will become a large ecosystem, but it certainly seems to be the more consumer friendly, and more profitable to content creators and distributors.

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1 Comment »

  1. grgisme said

    For once I hadn't heard about either of these (I blame a Doctor Who marathon). Thanks for the write up! Great to know. I wonder who had the idea first, and who utilized Corporate espionage :-).

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