The following article is excerpted from
The Industry Standard.
Could the recently announced
iPhone 3.0 operating system bring a new revenue source to the much-beleaguered publishing industry? Gartner’s Mike McGuire thinks it could. In fact,
in a blog post last week, he predicted that Apple’s announcement “will put pressure on a few folks in the media industry.”
Addressing newspaper and magazine publishers, he warns that “if you aren’t already developing or at least understanding, in detail, what the iPhone means to your sector, you will be feeling the pressure soon.”
The heart of the issue for McGuire is an API for
in-app purchasing. This will allow publishers of all kinds of media, including video and book publishers, to charge for content beyond the up-front cost of the app in the iPhone App Store. Since the publishers will write the applications (using Apple’s SDK), they will have a fair amount of control. One could sell individual articles or books, or subscriptions that will push the new content onto subscribers’ phones.
One thing the publishers and their developers will not control is where the money goes. Apple’s App Store will sit between the publishers and their customers.
McGuire isn’t bothered by the 30 percent that Apple takes out of every AppStore purchase. The company, after all, covers credit card and bandwidth expenses, and displays products where they’re likely to be seen and bought. He points out that “when you balance [that 30 percent] against what the cost-of-sales would be for having to sell it through your own website or a distributor, it might not be that bad.”
But there’s another problem with the App Store’s control that McGuire barely touches on: Apple’s policy to be able to reject anything submitted to the App Store. If McGuire’s prediction comes true, that could include publications, and perhaps even articles, that the company doesn’t approve of since Apple has been known to reject software for reasons that
smack of censorship.
I wouldn’t want to see Apple (or Microsoft, Google, or Amazon) getting that much control over what content could be commercially sold via hardware platforms they control.