At the risk of going on and on about Apple’s controversial new subscription billing rules, let me just add one more thing. Yes, these new rules may affect music streaming apps and movie streaming apps, but first and foremost they are aimed at print publishers who were hoping to port their existing subscription business models over to the iPad.
The big publishers and other media companies with substantial subscription businesses don’t like the prospect of handing over 30 percent of their revenues in perpetuity to Apple. What they like even less is losing the direct relationship with their customers, and all the data that comes along with that. (Whoever owns the billing relationship owns the customer, after all). But the one thing they fear most of all is Apple’s pricing power. The refrain I’ve heard from a couple of publishing industry insiders is: “How do we know next year Apple won’t be taking 50%?”
In other words, they are scared that they and their readers will get hooked on the iPad, which in three short quarters has already propelled Apple to become the top mobile computer company in the world. Right now they can still stand firm, and threaten to stick with Google and Its new, more favorable, One Pass subscription billing or Amazon’s Kindle. But if they give in without a fight, and Appel brings millions of new subscribers to their digital publications, then Apple can take an even bigger bite of the revenues down the line.
Apple could allay these fears by pledging not to change the economics for a set number of years. Locking in the 30 percent fee for three years, for instance, would take some of the uncertainty out of the process.
Photo credit: Yat Fai Ooi
Started by Steve Jobs, Steve Wozniak, and Ronald Wayne, Apple has expanded from computers to consumer electronics over the last 30 years, officially changing their name from Apple Computer, Inc. to Apple, Inc. in January 2007. Among the key offerings from Apple’s product line are: Pro line laptops (MacBook Pro) and desktops (Mac Pro), consumer line laptops (MacBook Air) and desktops (iMac), servers (Xserve), Apple TV, the Mac OS X and Mac OS X Server operating systems, the iPod, the...
The Apple iPad, formerly referred to as the Apple Tablet, is a touch-pad tablet computer announced in January 2010, and released in April 2010. It has internet capabilities running on either WiFi or 3G, and offers an optional dock with a full size mechanical keyboard. The iPad is a line of tablet computers designed, developed and marketed by Apple Inc. primarily as a platform for audio-visual media including books, periodicals, movies, music, games, and web content. Its size and...