Will Apple throw the book at e-book apps?

image Apple’s OS 3.0 preview event has just ended, and brought to light some very interesting new features. There is no shortage of coverage of the event; here is Ars Technica’s recorded liveblog and their post-event wrap-up. Gizmodo offers a “definitive guide” to 3.0’s features.

OS 3.0 will ship this “summer”. (My guess is June, to coincide with any new hardware introductions made then.) It will be free for iPhone 3G users, and $9.95 for iPod Touch users. It was not mentioned whether it would be free or $9.95 for first-gen iPhone users, but it will work on those older phones as well (though some features would not be supported by the older devices).

Although no new hardware was announced (dashing the hopes of some who had thought Apple might confirm the “netbook” rumors making the rounds), many of the most-desired missing features have been announced for the new OS: copy and paste, push notifications, MMS messaging, peer-to-peer connection, landscape keyboard in more apps, and so on.

The iPhone will be able to connect much more extensively to Bluetooth accessories such as speakers. Tethering will be supported, but will depend on individual carriers to allow it.

However, the very first new feature that was announced during the event caused me some concern over what it might mean to e-book applications on the iPhone/iPod Touch platform.

The In-App Store

After Apple SVP Scott Forstall had bragged on how well the iPhone and App Store had been doing lately, he talked about the high demand among developers for support for alternate business models—subscriptions, additional-level expansion packs, and purchasable content within apps.

Forstall even mentioned e-books specifically, quoted by Ars as saying, "These days you have to sell one application per book, for example, and developers want a book store built into the app." He then announced, "Today we’re supporting all of these additional business models."

Forstall talked about buying additional levels for a game after you have completed it (which will be good news for developers of level-based games such as Warfare, Inc.) and later on, an EA rep demonstrated The Sims 3.0 for iPhone, showing how it was possible to buy additional content right from within the game.

Only paid apps would be able to have purchased-content in-app stores, and the in-game stores would be run through the App Store, requiring typing in your password just like any other purchase. Apple would take the same 30% cut it gets from App Store purchases.

What About Existing “In-App” E-Bookstores?

It is easy to imagine that this might be a good thing for e-book apps that do not have their own associated e-book stores. For example, under this system the makers of the Classics app could sell new bundles of prettily-formatted public-domain books for their reader without having to wrap the reader around them individually.

But what was never addressed, in the presentation or in the Q&A afterward, was what this might mean for e-book apps that already have their own stores that can be accessed from within the app itself: eReader, Stanza, Shortcovers, and Kindle. (And Bookshelf can download Baen Webscription purchases, though not make them from within the app itself.)

These apps are free (except for Bookshelf), so they would not be eligible for a paid-content in-app store anyway. But they do allow users to make purchases from within the app’s interface—even the Kindle app will let you buy a book from the end of its sample chapter. This is usually done by calling WebKit so the actual purchase is handled via the Web, but all the same the users never have to leave the application.

It is hard to imagine that Apple would cut a company the size of Amazon off, but might they be inclined to ditch eReader, Stanza, or Shortcovers for violating the “no in-app store” rule? It is hard to imagine that they would do so in light of how long the apps have already been approved—but on the other hand, as free apps, these are not making Apple any money, nor does Apple have any control over the content.

Contentious Content

Content control was a reason that Apple had not allowed in-app stores up to this point—wanting to make sure everything you could get from the store stayed family-friendly. This is why the “Murderdrome” comic app-book was rejected, giving rise to cries of “censorship.” (Although I seem to recall that at the time, Apple had actually suggested they sell just the comic book app and offer the content separately.)

Many of the titles available through third-party bookstores are the sort of erotica that would not fit the squeaky-clean image Apple wants to promote. It is hard to imagine Apple allowing e-book erotica in an in-app store when it would not allow the “Murderdrome” appbook in its app store.

I would hope that Apple will let its own in-app stores be for companies that do business exclusively through those apps. They should let companies that offer content for multiple platforms continue to do so, selling to iPhone-users through the same store by which they sell to everyone else. It would be the sensible thing to do, and I would really hate to indulge in anti-Apple paranoia just after chiding others for the same thing.

10 Comments on Will Apple throw the book at e-book apps?

  1. Great catch, Chris. I think the 70/30 revenue split, if Apple insisted on it for all e-books, is the death knell for any iPhone/ipod touch book store app — after paying publishers, I doubt there’s 30 cents left on the dollar.

  2. Of course if the ebook reader companies want to get access to the iTunes store to sell books all they have to do is start charging $0.99 for their reader app, that’s a lot cheaper than buying a Kindle or Sony reader!

  3. Interesting take, but from what I understood, a trip to Safari is actually needed in order to fully browse and buy from Amazon’s K Store. Or am I mistaken?

    At any rate, could these free apps get away with a nominal 99-cent price? Or join with a publisher so that the app is, say, $5.00 with a selective eBook thrown in for free?

    I’m beginning to wonder if at some point Apple will indeed lower the boom on eBooks in some fashion. I don’t think ePub is up to Apple’s standards (look, for crying out loud, it just *recently* got justification!) and I really think they’re bound to come up with their own way. Just as they did with Copy & Paste (which you must admit is superior to all prior ways third parties had suggested!).

  4. @Aaron The 70/30 split is still superior to Amazon. Apple gives devs the *70*. Amazon TAKES 65%.

  5. Mike – don’t misunderstand me – I’m not taking a side or complaining about the particular revenue split. I’m saying that if Apple wants 30% of the revenue from an ebook sale and the publisher of a mainstream, best-seller book is already getting more than 70% of the revenue from Amazon (in some cases more than 100% of Amazon’s revenue, supposedly), there isn’t going to be 30% for Apple to take.

    The Amazon split you refer to is for self-published ebooks, what you or I would get if we uploaded a book to the kindle store. That’s not what the major publishing houses get on books by Stephen King or Danielle Steel.

    The Kindle iPhone app does not currently allow direct purchases but i think a lot of people were expecting or hoping that it would be updated to do that soon.

  6. Actually, I think the Kindle app does allow direct purchases, in a round-about way. I’ve been told there is a “purchase this book” link at the end of the sample chapter you can view within the app.

  7. “This is why the “Murderdrome” comic app-book was rejected, giving rise to cries of “censorship.” (Although I seem to recall that at the time, Apple had actually suggested they sell just the comic book app and offer the content separately.)”

    You just made that up. Apple suggested no such thing.

  8. I know I saw it in some of the articles about the thing at the time. I suppose it’s possible it might have been someone else.

  9. This sounds great for a revival of comics in the US. If the 10″ iPodHD tablet comes along as rumored (or is it to be a netbook?) then DC and Marvel and indies could give us full-color digital comics subscriptions through this.

    Another winner would be series books – mysteries, fantasies and the like. Subscribe to the series and get the book at midnight of publication date.

    It also opens the door to newspaper and magazine subscriptions on the iPhone OS platform.

    Wouldn’t it be ironic if after music labels turned to Amazon to combat Apple’s predominance in the digital music industry, publishers turned to Apple to combat Amazon’s predominance in the digital books/periodicals industry?

  10. @Chris: Trust me, mj would *know* about Murderdrome. And I must back him up on this.

    @Aaron: OK, now I understand what you meant, and I agree.

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