Apple’s in-app subscriptions could be better

Apple has finally introduced the in-app subscription service that has been long rumored. Subscriptions created through this service will incur the same 30% fee that Apple charges for other in-app purchases or sales of apps in the App Store.

While the 30% fee makes a lot of sense for the app sales made through the App Store as Apple is effectively acting as both distributor and reseller, such a charge just for handling the order processing for content providers seems a bit too steep.  When Apple makes a sale through the App Store, it handles the hosting and bandwidth for the downloads in addition to providing the storefront.

When users purchase content through an in-app purchase they don’t really download the content from Apple, but from the content provider.  This being the case it would probably be reasonable to expect that Apple would charge a smaller fee since it doesn’t have to handle the hosting and bandwidth costs and is only involved in handling the financial transaction.

As Apple does provide what we might consider the services which allow the creation of what are essentially in-app storefronts it is also reasonable to expect that they would charge more than credit card processing fees as well.

A more reasonable compromise for handing content sales might be a 10% charge, for example.  Such a charge would allow Apple to turn a profit from these services, without making iOS devices nonviable for content resellers such as Amazon.  You have to wonder if Apple really expects Amazon to turn over all or almost all its margin for sales to iOS device users or if they want to force such companies out of the Apple ecosystem.

Personally I haven’t purchased any eBooks for Amazon in the months I’ve had my iPad.  All the eBooks I have on the device were purchased from the publisher or through an independent reseller.  Still, I would not like to see Amazon go away.  Diversity is very important and only makes the whole ecosystem that much more vibrant.

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