Apple Wants 30% of Subscription Fees for Magazine, Video Apps
Apple announced on Tuesday (Feb. 15) a new iTunes-based service for subscription-based apps ranging from magazines to video-streaming apps (such as Hulu and Netflix) that will allow publishers to set up recurring payment plans. But the news comes with a few rules and restrictions.
"All we require is that, if a publisher is making a subscription offer outside of the app, the same (or better) offer be made inside the app, so that customers can easily subscribe with one click right in the app," said Apple CEO Steve Jobs in a statement.
Developers, in turn, will then have to give Apple 30 percent of earnings for subscriptions they sell through the iTunes store.
"Our philosophy is simple — when Apple brings a new subscriber to the app, Apple earns a 30 percent share; when the publisher brings an existing or new subscriber to the app , the publisher keeps 100 percent and Apple earns nothing," Jobs said.
Publishers can still sell digital subscriptions on their websites, or can choose to provide free access to existing subscribers. Since Apple is not involved in these transactions, there is no revenue-sharing or exchange of customer information.
But Apple said that publishers may no longer provide links in their apps (to a website, for example) that allow the customer to purchase content or subscriptions outside of the app.