Apple's new iPad subscription service draws mixed reactions from providers
Along with the emerging trend of traditional publications migrating to the burgeoning iPad platform, Apple has implemented its new system of automatically getting a 30 percent cut on new subscriptions availed through its publication services.
While the levy appears to be substantial for most publishers, the allure of the lucrative iPad audience, currently numbering to more than 14 million worldwide by the last count, is just too hard to resist, according to many leading publishers.
Elle Magazine' Philippe Guelton told PC World on Thursday that the current rate asked by Apple is far better as against "the cost of developing our own e-commerce platform, which is not economically viable."
Also, Gregg Hanno of Popular Science has admitted that Apple's current dominance on e-publication audience is indeed valuable and considering "today's consumer marketing environment, we feel a 70 percent remit directly to the publisher is a sustainable and reasonable model we can work with."
Apple's new subscription policy allows customer sign ins through in-app purchases which are automatically charged on iTunes accounts used by customers to contract the service. The system automatically deducts 30 percent from publishers' fees and they can actually opt out and lure customers from getting their publications outside of the scheme but Apple will have to shut them out of the system.
Such policy elicited anger from a number of providers as Rhapsody president John Irwin was quoted by PC World as saying that the new Apple system "is economically untenable and we will be collaborating with our market peers in determining an appropriate legal and business response to this latest development."
Yet more players are seemingly adapting a positive attitude on the Apple policy, opting instead to flow with the trend, with Yudu Media chief executive Richard Stephenson arguing that the easy navigation that iTunes offers is a multiplying factor in the subscription concerns of publishers.
Stephenson said that the right thing to do at this time is for publishers to integrate their operations with the Apple system as he pointed out that "when you take people off the App Store, you lose a lot of people along the way, the dropout rate is pretty high."
Also, Ted Nadeau of Elle Digital Group told PC World that the new policy will at least afford publishers more time to focus on content issues while Apple takes care of the payment processing area, leaving them "happy to concentrate on our core strength of producing great content."
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