Thursday, November 17, 2016 [Tweets] [Favorites]

Apple to Halve App Store Fees for Subscription Video Apps

Juli Clover:

Apple normally takes a 30 percent cut of all App Store app purchases and subscriptions, but for subscription-based streaming video apps like Netflix and Hulu, Apple plans to cut its fee to 15 percent. Apple has already reduced the fees for some of its video partners, and will soon extend the 15 percent rate to all subscription video services that are integrated with the company’s upcoming TV app.

4 Comments

Wonder if this means Apple and Amazon worked something out.

"Wonder if this means Apple and Amazon worked something out."

Very, very strongly doubt it.

1) Note the article refers to "subscription-based" services. Amazon dispute is all about a-la-carte.

2) Even if the article is wrong on that point, Amazon still can't make a profit on a-la-carte at 15% commission, while iTunes sells the same titles a-la-carte at 0% commission.

Here is the problem with Amazon Prime, they already got their full share when they charged my credit card the $99.00. It doesn't cost them anything but the amount of Development to put an app up for Apple TV. Just like the new Playstation Vue, the billing is done through Sony not Apple so no issue for them. Amazon does the billing for Prime but they insist on doing their paying customers a dis-service by not embracing a technology that their customers want even beg for.

"Here is the problem with Amazon Prime, they already got their full share when they charged my credit card the $99.00. It doesn't cost them anything but the amount of Development to put an app up for Apple TV."

Prime Video isn't Amazon's issue with Apple TV. Their inability to sell a-la-carte video on Apple's platform without taking a loss on each sale is their problem. Prime Video is a (major) loss leader for Amazon in order to help their a-la-carte video business. Without that motivation, Amazon either wouldn't even have a video component to your Prime subscription, or it would be far more minor and less costly. Of all the Prime benefits beyond shipping, video is by far the most costly for Amazon, and they're not doing at that scale just to increase Prime subscriptions.

"(Amazon) insist on doing their paying customers a dis-service by not embracing a technology that their customers want"

Apple is far, far worse. They won't let paying customers have access to their iTunes library on 3rd party hardware, even on neutral platforms like Roku and others where they could sell further a-la-carte stuff profitably. Amazon has no problem doing that - they even support fringe platforms like my TiVo.

(Same logic goes for the way Apple and Amazon handle books. One lets you read on any device you want. One only lets you read on their own hardware.)

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