In an update to the story I posted earlier today about Apple rejecting Sony’s Reader app, Ars Technica has now heard a response from Apple, and it comes with some pretty dire implications for other e-book apps. It seems that Apple is no longer going to be content to allow apps to access content purchased elsewhere unless it comes with an identical option to purchase the content from within the app as well.

The rub here is, of course, that Apple takes a 30% cut of any purchases made within the app itself. And since agency pricing (which Apple had a hand in implementing) means prices must remain constant for e-books no matter where they’re sold…well. This could be problematic for e-books’ future on Apple devices.

Hopefully the same backlash that led to Apple eventually allowing Flash applications and reverting the iPad’s "mute" switch will bring about some chances here. But who can say?

22 COMMENTS

  1. “And since agency pricing (which Apple had a hand in implementing) means prices must remain constant for e-books no matter where they’re sold…well”

    There no reason way Amazon and others couldn’t apply a service delivery free for Apple in-app purchases. For example this message could be seen on every Kindle book:

    Includes free wireless delivery via Amazon Whispernet except to iPhone/iPad Devices which carry an additional 30% fee paid directly to Apple.

  2. Ah, today’s hit count generating Apple kerfluffle.

    IMHO That’s another misreading of the whole issue over at Ars. You’ll still be able to buy ebooks somewhere else and load them onto a iDevice.

    It’s not the apocalypse.

    But hopefully Apple will find someone to explain this in simple words that even the fanboys on both sides can’t misinterpret. Unlike today’s attempt.

  3. Andy, there doesn’t seem to be a whole lot of room to misinterpret:

    “We have not changed our developer terms or guidelines,” Apple spokesperson Trudy Muller told Ars. “We are now requiring that if an app offers customers the ability to purchase books outside of the app, that the same option is also available to customers from within the app with in-app purchase.”

    If they can purchase books outside the app, they have to be able to purchase them inside it, too. For which Apple takes a 30% cut.

    If they don’t give Apple a 30% cut on anything they sell through the app, they won’t be able to let the app download external content.

  4. Are they going to go back and say we can only play music we have purchased throught the iTunes store on our iPods now? If not, what kind of message are they sending to their ereader users, the BIG sales pitch of April 2010? Text is one thing, but music is another. Greed and stupidity reigns over all.

  5. “If they don’t give Apple a 30% cut on anything they sell through the app, they won’t be able to let the app download external content.”

    …and 30% is the full amount retailers make on agency titles correct?

  6. I too will reserve judgment for now. Even if the response is clear (which it isn’t, with all the unanswered implications still out there), it wouldn’t be the first time a spokesdroid has been repudiated after a “policy” turned out to be bone-headed. When and if Apple yanks Stanza, Kindle, Nook, etc. off the App store, THEN I will worry about taking my business elsewhere.

    That said, IF this policy is applied as it reads now, Apple deserves every bit of the flaming they’re about to get.

  7. I don’t have a problem with Apple enforcing this policy. The customer has the choice of buying in app and Apple gets the 30% or out of app and Amazon/Sony/Kobo gets the 30%. It seems reasonable to me. Their platform their rules.

    Amazon/Sony/Kobo have their own platform and their own rules. Which is nobody else can run their application on our platform.

  8. Amazon should find a way to mark up prices of books purchased within the iOS app. They charge an extra $2 to have books sent to the Kindle via 3G outside the U.S., so they can probably find a way to charge that extra 30% to the reader. They can even have a notification pop up right before purchase warning the reader that in-app purchases will cost them an extra 30%. I bet that would keep away in-app purchases.

  9. Once Apple develop their own platform in ebooks, movies etc the idea that they would allow others to piggyback for free is naive. That said 30% is ludicrous. Of course we will have to wait and see, Apple’s app rules are as opaque as mud.

    Device plus platform is the the way to go. Expect things to get more difficult ios app-wise if you are offering content that Apple is into as well.

  10. “Would you apply it to Microsoft Windows and Internet Explorer too? Riiightttt…”

    I don’t like the App Store model and I’m very critical of it but I don’t deny that Apple has the right to do it on their platform. Yes Microsoft could have done the same thing on Windows and I wouldn’t have liked it there either but I wouldn’t deny them the right to do it. (Internet Explorer is a bad example because Apple has no restrictions on what you do in Safari).

    I think it’s hypocritical for Sony to complain about this particular rule though. Compare Apple’s policy on this to Sony’s policy for their ebook reader. Where is Sony’s policy for 3rd party ebook reader application’s purchasing ebooks on the Sony reader?

    Compare Apple’s policy on this to Sony’s policy for games on the PS3.

  11. There seems to be a consistent misunderstanding of how agency works as regards ebooks. The agency price is the MINIMUM price at which an ebook can be sold, not the MAXIMUM price. That is why there is some variation in agency pricing among booksellers.

    According to some recent survey noted on Teleread within the past month or two, most iPxx users buy ebooks using the Amazon app, not from the Apple bookstore. The number two buy place was the Apple bookstore followed by B&N and some others.

    If Amazon, B&N, Sony, Kobo, and the other non-Apple stores simply stop supporting iPxx, this could have a major impact on the agency group’s revenues and could diminish their power to enforce the agency system. After all, the surveys show that most people do not buy an iPxx to use as an ereader. The ereading function is secondary at best, and tertiary more often.

    I wrote nearly a year ago that come April 2011 publishers would begin to realize that Apple is their worst nightmare, not their best friend. I may have been off in timing, but I think that realization will soon come home to roost in the agency proup’s and in publisher’s in general bottom lines.

  12. Here’s an interesting idea. Maybe Apple is doing with books what it did with music. Forcing publishers to provide them DRM free. Came up with this idea from here:

    Actually book vendors and publishers could do exactly what Amazon does with their MP3 store — sell DRM free .ePub versions of their books which readers could then load into iBooks through iTunes.

    The vendors get to keep 100% of the book price. Simple, and not something Apple would or could ever block.

    from Ted T. Tuesday, February 1 2011
    http://gigaom.com/apple/apple-would-be-crazy-to-block-use-of-outside-content/

    What do you think?

  13. Karen wrote:
    “Are they going to go back and say we can only play music we have purchased throught the iTunes store on our iPods now? If not, what kind of message are they sending to their ereader users, the BIG sales pitch of April 2010? Text is one thing, but music is another. Greed and stupidity reigns over all.”

    Can you please explain the basis of this hysterical comment ? I would be delighted if you could point me to the evidence or basis on which you make these claims ?

  14. The Kindle books I have on my iPad are those which are enhanced by being there: i.e., one with North American bird songs, one containing knitting videos, a gigantic Cajun cookbook complete with color pictures. I do not do long form reading on it since I have 3 different brands of e-reader. But if I were deprived of the ability to use these books on my iPad, books which I specifically bought for that use, I’d definitely switch to an Android tablet next time.

  15. Most people seem to be upset at losing the ability to side-load content onto their iDevice. Side-load == loading content NOT purchased thru Apple.

    Others seem to think this also means you will be unable to use content you already have because of this DEVELOPER rule misinterpretation.

    I even see it in this blog post, attributed to others.

    Nowhere has Apple said anything like this! It’s pure speculation by hit count driven sites like Ars Technica. And has been refuted elsewhere.

    And it goes against past Apple practices with media that are embedded in iOS apps and iOS itself.

    I think what Apple HAS said is confusing because the context of the issue is being lost.

    Which is – that an app that has the ability to access an external, non-iTunes store to buy content must NOW follow the existing, unenforced until now, rule that they also provide users with the OPTION to use Apple’s store API to handle purchases ( which means the vendor paying Apple a cut for doing the payment processing for transactions )

    Without looking at how Apple’s Store API works, It’s impossible to say how this option would work for users. It might make things confusing. It might not. It might cause user content prices to go up. It might not. That 30% cut Apple is supposedly claiming from the vendors might be reasonable. It might not ( I think it’s a bit much myself if all they are doing is handling the money… If.)

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