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Comment by bigiain | Hacker News Reader

Interesting, the tech press is currently full of doom and gloom about Apple charging a 30% commission on publishers content sales, including many comments about how it'll force Amazon to pull the Kindle reader app, yet here I see the claim that Amazon's charging their publishers more. This article claims Amazon sends publishers (Price - delivery costs) * 70%

(admittedly, since Amazon are delivering some of their content "for free"( to the customer) over 3G, having the publishers pay some of the cost seems fair to ensure bandwidth-heavy publications don't free-ride on easier-to-deliver items)

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I think most of the angst around these new rules are less about Apple charging 30% of a magazine or book publisher's content sales, which may well be in-line with what Amazon charges, and more about the apparent intent to impose this same arrangement on things like Netflix, Rhapsody, and any other SaaS with an app in the app store, most of whom don't have the leeway to survive forking over 30% of a monthly fee to Apple.

That's where the whole "Apple deserves something for bringing millions of eyeballs to the app store in the first place" argument really breaks down. The iOS Linode utility app is of value to me as a user, but it's a tiny part of what I get out of Linode, so it in no way seems reasonable for Apple to demand that Linode now allow sign-ups through the iOS app and hand over 30% of the monthly fee for those sign-ups. I'm not on Linode because of the iOS app, I'm on iOS because of useful utilities like the Linode app.

So when most of these useful add-on utilities are driven off the store by this crazy land-grab, users like me are going to be driven right off the platform as well.

Didn't Apple say basically "if you can sign up in the app, you need to be able to sign up in the app in a way we get a cut". So as long as linode doesn't take on new customers in the app, no problem?

Similarly amazon could have a free iOS reader, no problem, from which you cannot buy any books. it's when they want people using the iOS app to buy books but not pay apple a cut that apple is unhappy.

Now I'm not saying I agree with Apple. I'm pretty skeptical of interfering with the kindle app much because that sounds to me like it won't be good for users. But I'm trying to keep an open mind and see what apple is actually saying and trying to understand what's going on. I haven't seen anything about apple trying to get 30% of linode monthly fees and i think that's a bit of a straw man.

> Didn't Apple say basically "if you can sign up in the app, you need to be able to sign up in the app in a way we get a cut". So as long as linode doesn't take on new customers in the app, no problem?

From the press release[1]:

However, Apple does require that if a publisher chooses to sell a digital subscription separately outside of the app, that same subscription offer must be made available, at the same price or less, to customers who wish to subscribe from within the app.

So no, any SaaS that can take on new customers on their site has to give their iOS app the same ability at the same price, with the requisite 30% cut to Apple for those subscriptions. They don't get to choose to not offer it at all.

> Similarly amazon could have a free iOS reader, no problem, from which you cannot buy any books. it's when they want people using the iOS app to buy books but not pay apple a cut that apple is unhappy.

Amazon already has this. You can't buy books from the iOS Kindle app, you can only do it through their website, with a link in the app kicking you out to Safari. That's also forbidden under the new rules (again, from [1]):

In addition, publishers may no longer provide links in their apps (to a web site, for example) which allow the customer to purchase content or subscriptions outside of the app.

[1]: http://www.apple.com/pr/library/2011/02/15appstore.html

[Note: I am paraphrasing bits below because I'm not sure of my legal right to provide the exact wording of the agreements since those are behind developer log-in pages and I don't want to risk my iOS developer account.]

>> Didn't Apple say basically "if you can sign up in the app, you need to be able to sign up in the app in a way we get a cut". So as long as linode doesn't take on new customers in the app, no problem?

> However, Apple does require that if a publisher chooses to sell a digital subscription separately outside of the app, that same subscription offer must be made available, at the same price or less, to customers who wish to subscribe from within the app.

> So no, any SaaS that can take on new customers on their site has to give their iOS app the same ability at the same price, with the requisite 30% cut to Apple for those subscriptions. They don't get to choose to not offer it at all.

This is more about content than about access. I could certainly be wrong, but Apple's not after SaaS, and probably isn't even after content-rental services (e.g., Netflix or Hulu).

The updated guidelines talk about content that is sold outside of the app. (11.6, 11.9, 11.12, 11.13, 11.14). The developer agreement has attachment/schedule 2 for In App Purchases. IAP can't be used for goods or services that are used outside of your iOS app; the wording is very precise (schedule 2:1.1). I would read that as Linode and similar services being 100% in the clear because they aren't even allowed to use IAP.

Subscriptions are a little more fuzzy; both content and services are allowed for subscription (schedule 2:2.3), but rentals through IAP aren't allowed (same). This suggests to me that services like Netflix and Hulu are pretty safe, but it's not as clear. Services in general are pretty clearly only intended for services that are intended primarily to be accessed through your iOS devices (the example provided is turn-by-turn map services). Schedule 2:2.3 also makes a limited exception to 3.3.9 of the main agreement for content-app data collection.

The official agreement seems to say nothing about equivalent offer practice (what you offer outside the app for purchase or subscription must also be offered inside the app), but that could be that I just don't know the right legalese.

So if my broker has an app, and I use it to buy a million shares of a company in my account, Apple should get 30% of the transaction?

For what, providing networking functionality?

No. For many reasons, but one in particular:

Your broker cannot offer an app with IAP that does purchases of goods or services that cannot be used in the app itself. (iOS Developer Agreement, schedule 2:1.1)

This is all about IAP. If you aren't allowed to offer IAP for your particular item, these rules don't apply. If, however, you could theoretically use IAP for your content, you cannot offer such a service solely through external purchases.

How is this even comparable? Amazon is not forcing anybody to sell content through their channel in order to make the content available on the kindle. I don't think the issue is the amount Apple is charging, but instead that they are forcing content providers to make content available through the AppStore at the same price as elsewhere, and at the same time wanting a commission.

The difference is that Amazon allows publishers to recoup the overhead of the platform in the subscription price, whereas Apple does not - i.e. charge a premium due to the charges Amazon imposes.

From the article: The Economist costs £9.99 per month on The Kindle store, almost £20 more expensive over the course of 12 months than a print subscription that also gives access to the digital editions (excluding Kindle)

No amazon is worse. They don't allow you to set the price.

They do on your website.

From the horse's mouth: User revenue will be split 70% to the developer and 30% to Amazon net of delivery fees of $0.15 / MB. -- http://kdk.amazon.com/

That page also indicates the bandwidth threshold under which Amazon pays is 100kb/user/month.

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