I was once in this strange relationship: all we want to do was lie to each other. Thing is, I learned a lot about human behaviour and the tendency to over-complicated your explanation when you know that you're doing something indefensible and for some reason the memory came to mind when I tried to translate the new rules of prey on Apple App Store subscriptions. I'm starting to wonder if Apple [AAPL] has changed its supplier of Kool-Aid and started to transform into Microsoft ...
A quick recap if you missed. Yesterday Apple announced new rules that anyone selling subscription or in-App purchases through the App Store will have to hand over 30 percent of revenue to Apple. Sell anything outside of App Store for use within an application and you also sell it for the same price or less in the App. See: even when you try to make simple explanation is confused, that's because Apple knows it is ask too.
A step too far
Who is impacted? Publishers of newspapers and magazines running Apps, publications of small startups to explore the application as a new form of publishing, Pandora and all streaming services. NetFlix and Hulu are infected, and Amazon will deliver the loot if it wants to keep Kindle on the App Store.
[This story was from Computerworld Holic Apple blog. Follow me on Twitter or subscribe via RSS to make sure you don't miss a beat].
This is awesome. With a deeply flawed Apple is creating enmity with each organization of the main means of communication; not only this, but it could easily be accused of using its market power to force the services competitors out of the store. Incredibly popular music streaming service, Pandora, is threatening antitrust action. I don't blame them.
Here are a smattering from an article in the Wall Street Journal advertising pro-Android Apple: "my inclination is to be investigated" about the new service from Apple, says Shubha Ghosh, a Professor of antitrust at the University of Wisconsin Law School.
Ghosh is questions if dominant market position (as is Spotify we launch progressing--and why?) and if the company is putting "anti-competitive pressure on price."
I don't think that keeping Apple App Store is a monopoly--there are other platforms--but I'm quite certain that new subscription charge will stop stupid contestants. And that smells a little anti-competitive to me.
(Above: CEO Apple launches App Store)
Care and simplicity?
Here is the statement, Apple CEO Steve Jobs ' on the new rules:
"Our philosophy is simple — when Apple brings a new Subscriber to the App, Apple earns share of 30%; When the Publisher brings a new or existing Subscriber for the application, the Publisher retains 100% and Apple earns nothing.
"All we need is that, if a Publisher is making a subscription offer outside of the App, offering the same (or better) within the application, so that customers can easily subscribe with one click right in the App. We are convinced that this innovative subscription service will provide publishers with a brand new opportunity to expand access to their digital content on the iPad, iPhone, iPod touch and delight both new and existing subscribers.
Any statement that follows the expression "our philosophy is simple ..." with the declarations of the Baroque in this complexity is a lot of things, but certainly not easy.
When I read these words my mind flashed back to vent ' years in that bad relationship that I mentioned earlier. I mean, I know enough love to know when I was asked to consent to my abuse, and in this particular case, Apple asking all participants in its value chain of the App Store to pick it up as they really like it.
And I am seriously considering a future for the platform in the event that we decide that Mac software to be sold only through Mac App Store.
What is with the App Store?
I love Apple products, over the years I've had a lot of pleasure from them, but it seems to me that the App Store is the focal point of pride for this company. The serpent of Apple that eventually will cast the company in the autumn.
App Store errors have included censorship the wrong political debate, over-pruriginous attitudes toward grown-up games and the long-held public contretemps with Google about Google Voice. These subscription rules join the catalogue of errors.
What I don't understand is why Apple needs to chase the money like this. It is moving towards becoming the world's richest company--even while their labour relations are forced and child labour to some of its production partners. Has billions in the Bank, and while I agree the expenses must be met and the company has the right to strike and to agree on a revenue stream, this share of 30 percent for deploying virtual harkens back to the cost of retail &-bricks. The business plan looks great on paper but the analogy is all wrong.
History repeating
Opinion on what happens to music now as consumer tastes are moved by this property to access. Shawn Fanning of Napster Back in 1999 he filmed labels asking for distribution licenses based on the fact that millions of downloads to 10 cents each would generate huge piles of cash for labels and artists. Labels refused, lost million for file sharing, killed Napster and iTunes generated. Now, with streaming services, labels are taking the Napster affair--you're taking a low income to replay the trace.
Definitely Apple could not have missed this evolution? The company is requesting cash &-bricks in a digital world. Of course, Google friend-turned-enemy immediately responded to the craziness of Apple with the introduction of Google One Pass:
"A system for user authentication, payment processing and administration, Google One Pass lets you focus of publishers about creating high quality content for their readers. Publishers have flexible payment models and control digital content, for which they charge and the content that is free for consumers.
Google isn't taking 30 percent--is resolved to a 10 percent more palatable. Just like Apple should. New Apple subscription rules are flawed.
This is great news for power of Android. Google now may support for so-called "transparency of Android" remembering App Store Apple's greed Services subscription.
We hope that this isn't the start of a series of diktat flawed as the company consolidates its position after a period of extremely rapid growth.
What do you think? Apple is right or wrong? Let me know your thoughts on this in the comments below and if you'd like to please follow me on Twitter so I can drop you a short message whenever you post new articles here first on Computerworld.
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