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Apple has made its subscription program live for all publishers in the App Store, as of Tuesday. The service covers all “content-based apps,” including not just magazines, newspapers, but video, music, etc. This is the same billing service that went live with Rupert Murdoch’s “The Daily” app.
Publishers will be allowed to set the price and the length of the subscription term, with lengths ranging from weekly, monthly, bi-monthly, quarterly, bi-yearly or yearly. Apple will collect 30 percent of the revenue, for subscriptions handled within the App Store.
The “within the App Store” is a key. Publishers can sell digital subscriptions on their web sites, and additionally, can provide free access to existing subscribers. Apple collects no revenue or customer information from these sales, but does require a publisher to make the same subscription offer available (at the same price or less) within the app, as well. Now banned are links inside of apps which allow users to purchase content or subscriptions outside of the app.
To be clear, the full revenue breakdown is: when a new subscription is sold via the app, Apple keeps 30 percent; when the publisher brings an existing or new subscriber to the app, the publisher keeps 100 percent and Apple receives nothing.
The press release (embedded below) uses the word “subscription,” the blurb about “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” may be a little worrisome to apps such as Amazon’s Kindle.
Press release below; you’ll notice Apple managed to slip in another “magical iPad” reference.
Apple Launches Subscriptions on the App Store
CUPERTINO, California—February 15, 2011—Apple® today announced a new subscription service available to all publishers of content-based apps on the App Store℠, including magazines, newspapers, video, music, etc. This is the same innovative digital subscription billing service that Apple recently launched with News Corp.’s “The Daily” app.
Subscriptions purchased from within the App Store will be sold using the same App Store billing system that has been used to buy billions of apps and In-App Purchases. Publishers set the price and length of subscription (weekly, monthly, bi-monthly, quarterly, bi-yearly or yearly). Then with one-click, customers pick the length of subscription and are automatically charged based on their chosen length of commitment (weekly, monthly, etc.). Customers can review and manage all of their subscriptions from their personal account page, including canceling the automatic renewal of a subscription. Apple processes all payments, keeping the same 30 percent share that it does today for other In-App Purchases.
“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,” said Steve Jobs, Apple’s CEO. “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. We believe that this innovative subscription service will provide publishers with a brand new opportunity to expand digital access to their content onto the iPad, iPod touch and iPhone, delighting both new and existing subscribers.”
Publishers who use Apple’s subscription service in their app can also leverage other methods for acquiring digital subscribers outside of the app. For example, publishers can sell digital subscriptions on their web sites, 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 with Apple. Publishers must provide their own authentication process inside the app for subscribers that have signed up outside of the app. 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. 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.
The revolutionary App Store offers more than 350,000 apps to consumers in 90 countries, with more than 60,000 native iPad™ apps. Customers of the more than 160 million iOS devices around the world can choose from an incredible range of apps in 20 categories, including games, business, news, sports, health, reference and travel.
Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork, and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple is reinventing the mobile phone with its revolutionary iPhone and App Store, and has recently introduced its magical iPad which is defining the future of mobile media and computing devices.