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Apple Rejects Sony Reader App, Tightens Grip on Content Sales

From now on, all in-app purchases must go through Apple.



Matt Kinsman By Matt Kinsman
02/01/2011

Apple has reportedly rejected Sony's reader app from the App store for selling content within the app and letting customers make purchases outside the App store (such as within the Sony Reader Store, according to The New York Times).

From now on, all in-app purchases have to go through Apple, according to Steve Haber, president of Sony's digital reading division. "It's the opposite of what we wanted to bring to the market," Haber is quoted as saying by The Drum. "We always wanted to bring the content to as many devices as possible, not one device to one store."

The news comes the day before Apple and News Corp. are supposed to debut News Corp.'s new digital magazine The Daily, and many observers predict Apple will use that opportunity to unveil a new subscription system.

Publishers may now need to start paying Apple the 30 percent commission that's always existed but hasn't been strictly enforced. Publishers will also have to make sure all apps comply with Apple's developer guideline by March 31. 

What's This Mean For Everybody Else? Maybe Nothing

The move could have significant impact on the emergence of other digital newsstands as well as other dotcom giants like Amazon that offer free mobile apps so users of devices like the iPad can make purchases directly from the Kindle app.

While Apple has made more money selling devices than content and apps, requiring people to access more content from more sources on their iPhones and iPads would require more people to buy more devices, according to The New York Times. However, Amazon (and Barnes & Noble) may not face the same problems as Sony because they enable consumers to buy books directly from their sites, which wasn't the case with the Sony Reader Store, according to Mashable. 

Apple, potentially Google and publishing industry home team Next Issue Media are all reportedly working on their one-stop shops for digital periodicals, while Barnes & Noble, Amazon and some of the digital magazine vendors, such as Zinio, are already offering a newsstand experience.

Next Issue Media has said its storefront will only be compatible with Google's Android system to start while some observers have wondered whether standalone newsstands like Zinio will maintain their independence or fold into iTunes once Apple launches its newsstand (Zinio says it has "no comment" on Apple's latest decision).

However, many of the digital edition providers say the steps Apple is taking won't hurt publishers. Digital edition provider Yudu (which has tied its offerings directly to Apple products such as the iPad) says Apple's new policy could actually benefit smaller and medium-sized publishers by offering a far larger audience through the App store than they could ever get through print. "This announcement will mark an improved user experience and allow for easier access to their chosen material, directly from the App Store," says Yudu CEO Richard Stephenson. "The consumer will no longer have to navigate away from the App Store to third party portals and payment gateways."

Texterity is "relieved" with what it's hearing from Apple. "What they're asking is reasonable," says Texterity president Martin Hensel. "We do a lot of b-to-b magazines and Apple is cool with us putting people through a qualification form. We do a lot of association magazines where the magazines come as part of the membership and Apple is cool with us verifying that someone is a member without having to go through the iApp process. The only time we have to offer the iApp process is when we're selling a digital-only subscription or a print and digital subscription at a premium over print-alone."

Marcus Grimm, marketing director at Nxtbook Media, has a three-phase recommendation for publishers who want to develop Apple apps. "One, make sure your business plan can support giving Apple their cut, if it comes to that," he says. "Two, publishers should also be working out their Android strategy, which is easier business-wise, though more complex technology-wise, with multiple versions to support. Three, this is yet more proof that publishers need to make sure their Apple investment is worth the return. Publishers can get their content on these devices effectively without spending an arm and a leg, particularly if Apple wants 30 percent of said limbs." 

 

Matt Kinsman By Matt Kinsman
02/01/2011







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