Apple Outlines Subscription Option

Reveals blueprint for selling subscriptions through apps.

February 2, 2011 By Jim Sturdivant

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A representative from Apple has told app developer Texterity that publishers will now be able to sell digital magazine subscriptions within apps—so long as Apple is given equal opportunity to do so.

In answer to a series of requests for clarification about how to design subscription and single-copy sales into the apps it develops, Texterity was given the run-down on what is and is not permissible for a variety of publishing scenarios, as reported yesterday in a company blog post.

For those looking to buy digital-only access to magazine subscriptions, "If you decide you want to buy a subscription you now have a choice that comes up [within the app]—effectively two buttons, one for the app store and the other for purchase through the publisher," says Martin Hensel, founder and president of Texterity.

"Apple wants the [in-app purchase] process to be an equivalent option equally presented," he says. "So a person can go to Apple and have a one-click purchase or go to the publisher and purchase, so that does not foreclose the publisher from collecting [customer] data. It just puts Apple on equal footing with them."

Hensel believes many consumers will choose the Apple purchase process because it involves "two clicks and you're done," meaning Apple would in those cases still be keeping its 30 percent share of the sale. "One of the questions we have is whether the publisher can provide additional promotion materials such as a cookbook to induce someone to go through the publisher's purchase process rather than the Apple purchase process. No word on this yet from Apple."

While Apple obviously is interested in keeping a significant portion of any subscription business, "Apple could have been a lot more draconian here," Hensel says. "The fact that they are just saying you have to give us equal footing is basically a consumer-friendly attitude. It's giving consumers a choice."

Apple being involved in the subscription selling business would obviously affect publishers' ability to collect data, and Hensel reports Apple is also saying they are going to be in the renewal business, which will additionally impact publishers' bottom line.

On other fronts, Apple told Texterity that there will be no restrictions on publishers' offering digital subscriptions as an added bonus for print subscribers, so long as there is no extra charge over what print would have been.

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