Apple

Apple Transforms From Savior To Sinner With 30% Subscription Tax

toll Apple Transforms From Savior To Sinner With 30% Subscription TaxIt was a little over a year ago that David Carr first wrote about the, “so-called Jesus tablet that can do anything, including saving some embattled print providers from doom”.

The notion that the walled garden that Apple was creating would encourage users to purchase content they were accustomed to getting on the open web for free seemed to play out at first, with eye-popping sales for certain glossy magazines.

But those numbers didn’t last, and yesterday Apple whipped up a hornet-s nest, instituting a mandatory in-app subscription for all paid services and taking a 30 percent cut of each new subscription.

Some companies, like the music streaming service Rhapsody, immediately cried foul, saying their margins wouldn’t accomodate such a hefty toll to Apple. Across the web the decision was by turns described as greedy, overreaching or brilliant, and The Wall Street Journal‘s Nathan Koppel reported that law professors may even see an antitrust case forming against Apple.

For now, publishers have little choice. They can sacrifice profits on Apple-sourced customers in order to maintain marketshare, or they call Apple’s bluff and hope Android and HTML5 come through in a hurry. As NY entrepreneur Yaron Galai joked on Twitter, publishers can, “a) pull my app from the App Store, or b) invest *all* available cash in Apple stock.”

bpopper [at] observer.com | @benpopper

 

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