Apple Subscription Service now announced & explained: Will the new terms from Apple see a shift in publishers from iOS to the Android platform?

February 15, 2011, By Shawn Wagnon

Apple has announced the long talked about subscription service and while we are very reluctant in passing judgments within hours of anything new (something most others seem to be already on), it does seem like Apple is not giving many of the publishers much of a choice. This is not to say that we do not like the service. In fact, from a personal standpoint (being a consumer) we have no qualms at all. But will this mean more publishers jumping ship to Android?

According to the new system, “any service offering an app with any sort of subscription component attached to it, must now offer it within the app using the new in-app subscription options.” Publishers are free to also offer subscriptions outside the app, like they have been doing till date. But the in-app subscriptions are now a must, to continue the subscription services outside the app. If the user subscribes for the content using in-app services, Apple get 30% of the revenue and the publisher 70%.

If the user subscribes outside the app, in the way they have been doing till now, the publisher gets to keep 100% of the revenue. So, that does not sound that bad, does it? Well, there is one key addition. “If a publisher is making a subscription offer outside the app, same or better (meaning a cheaper deal) must be made in-app”. Forget about the “better” part, even making a same deal in-app means loss of revenue for the publisher straight away.

Let us see this Subscription policy of Apple from two sides- the publisher & the consumer. If you are the consumer, now you can find each and every possible subscription offer available on iOS devices in the app store. So, why bother look elsewhere when you can get it done with a click? This means, in time, people (being people and hence lazy) will barely ever put in subscriptions outside the app store as they would not want to go searching.

If you are the publisher, you cannot have subscriptions outside the app simply because you are not allowed to make a better deal there. iPad consumers will just go to the app store, make a click and 30% of your revenue goes into Mr. jobs’ pocket. Not cool at all!

Well, again we must say that being the customers in this equation, we are actually fine with the new service as it saves time and effort. But the bigger question is, will this back fire and will publisher now move over to the Android platform? Let us wait for a few more days to see the trends on that. But feel free to voice your concerns/opinions…

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