Seattle-based Rhapsody and Amazon Kindle are among a wave of businesses that have removed links to their external digital stores from inside their iPhone, iPod touch and iPad apps in recent days.
The steps are meant to comply with new conditions imposed by Apple on the sale of subscriptions and other digital items to users of iOS apps. However, the companies are still avoiding sharing with Apple a cut of the sales they make to their app users.
Apple first outlined the rules in February, saying that it would be taking a 30 percent cut of subscriptions sold inside iOS apps, and preventing app makers from sidestepping the revenue split by telling them that they could no longer link to external online stores from inside their apps.
Companies including Rhapsody, Amazon, the Wall Street Journal, Kobo and Barnes & Noble have removed links from their iOS apps to their external stores in recent days, to comply with Apple’s rules. But to avoid Apple’s 30 percent cut, most of them aren’t offering an in-app purchasing as an alternative. Instead, they’ll be relying on their users to figure out on their own how to find the right site to sign up for subscriptions or buy digital items, such as e-books.
Jon Irwin, the president of Rhapsody International, told GeekWire in March that the company’s profit margins simply weren’t big enough to give a 30 percent cut to Apple from music subscription purchases by iOS app users.
A Rhapsody spokesperson said in an email today that the company is “100 percent compliant with Apple’s developer rules. We would love to use the in-app purchase if we can find an economical way of doing it, and we will continue to work toward it.”
Apple relaxed part of the rules in June, no longer requiring in-app purchases to be the same price or less than the same items sold outside the apps.
But for now, the situation amounts to a stand-off between Apple and major companies offering subscriptions and digital items. Apple CEO Steve Jobs said in a statement at the time of the original announcement, “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.”