Peter Kafka

Recent Posts by Peter Kafka

Apple Rolls Out Long-Awaited/Feared Subscription Plan

Apple has finally announced its subscription plan for its apps sold through its iTunes store: As previous reports indicated, it both allows app developers to set up recurring payment plans for iPad/iPhone/iPod apps, and mandates that developers who want to sell subscriptions use iTunes in addition to their own platform.

Here’s Steve Jobs, via press release: “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.”

That requirement may not matter much to subscribers, but it will to developers, who will have to hand over 30 percent of their revenue for all subscriptions sold through the store.

Some content companies I’ve talked to have held out hope that Apple’s subscription requirements would apply only to newspapers and magazines. But Apple’s language seems to indicate that this will apply to all subscription apps–“magazines, newspapers, video, music, etc.–which would include video services like Netflix and Hulu Plus, and music offerings like Rhapsody and Spotify.

Apple’s plan will have significant ripple effects, but one of them won’t be a flood of digital magazine offers from big publishers like Time Warner’s Time Inc., which has been quite clear that it’s not happy with Apple’s terms, and will work with other platforms like Google’s Android instead.

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