Apple's New Subscription Model: Pros and Cons
Apple recently said it wants a 30 percent cut of all subscriptions sold on iOS devices, including services that offer music, video, newspapers and magazines. But Apple's move may force digital publishers and content providers such as Netflix, Amazon and Hulu to think long and hard about continuing to offer apps for iPhone, iPad and iPod Touch devices.
Music subscription service Rhapsody is already vowing to fight back, arguing that Apple's 30 percent cut would make Rhapsody's iOS apps "economically untenable." "We will be collaborating with our market peers in determining an appropriate legal and business response to this latest development," the company said in a statement.
Apple's new policy
Under Apple's new in-app subscription model announced Tuesday, all businesses offering content subscriptions on iOS apps must use Apple's new subscription service. That means Apple gets a 30 percent cut of all subscription transactions that happen on an iOS device.
As a trade off, digital publishers can still offer content within an iOS app for free to existing subscribers, as long as they also offer a "subscribe" button within the iOS app.
But the part that has the potential to upset digital publishers is that all links to make purchases outside an iOS app have to be removed. That means links such as Amazon's "Shop in Kindle Store" button, which boots you from the Kindle app and into mobile Safari to purchase books, may have to be removed.
So what are the possible implications for Apple's new mandatory subscription model? Let's take a look.
Easy To Buy
For the average iOS user, Apple's new subscription model will let you buy a subscription within your favorite apps with just a few clicks. You won't have to worry about entering your credit card information or filling out a form on a cramped iPhone screen since Apple already has all your information.
Although buying Kindle e-books on an iOS device is a pretty good experience, it is a bit of a hassle. You have to go to Amazon's website, buy your book, then reopen the Kindle app and go to the archived section to download your new item. Sure, buying a Kindle book is relatively easy once you get the hang of the system, but it's far from a seamless experience.
Compare buying a Kindle book with getting a comic book on the Comixology iOS app. Let's say you want to buy an issue of The Green Hornet. All you do is hit the buy link, enter your Apple account password and the comic book starts downloading. Two steps instead of four.
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