Apple Announces In-App Subscriptions For Content-Based Apps On The App Store
Apple has announced a new subscription service for the App Store, which will allow publishers of content-based apps to sell subscriptions for content such as magazines, newspapers, music and video to users using the App Store billing system.
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.
Steve Jobs has clarified the philosophy behind the in-app subscription:
“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.”
Apple hasnâ€™t provided any information on when iOS 4.3 will be available, which is apparently required for in-app subscriptions.
It remains to be seen how publisher of content-based apps like Amazon, Netflix etc. plan to implement this requirement as Apple takes 30% cut of the revenue when a user buys subscriptions inside the app, which will be on top of the revenue it needs to pay content providers.
Its probably a fair thing to expect from Appleâ€™s point of view as the in-app purchase option is lot more user friendly. What do you think?
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