Update: Apple snubs Sony, abolishes apps that peddle content outside iTunes

February 1, 2011 By Jeffrey Van Camp

Apple has rejected an e-book reading app from Sony, citing a new change in policy. Apps can no longer sell or access content not purchased through the App Store. The move puts a number of high profile apps in danger.

Apple rules over its App Store with an iron fist. It makes its own rules and reserves the right to reject or delay any app for almost any reason. Now, the world’s largest app store is telling major application developers like Sony that they are no longer allowed to sell in-app content or even let customers view content they may have purchased outside of Apple’s App Store. Confused? The implications may be worse than you realize.

Sony’s Reader Store rejected

The NY Times reports that Apple has rejected Sony’s e-book iPhone app, which lets people buy and read e-books on the Sony Reader Store. From now on, Apple told Sony, in-app purchases must go through Apple, presumably so the company gets a cut of profits.

In a statement on its Reader Website, Sony acknowledged the issue: “We would like to update everyone on the status of our Readerfor iPhone mobile application. We created an app that we’re very excited about, which includes all the features you’ve come to expect from a mobile reading application – including access to your existing collection, synching with your Reader Daily Edition and purchasing new content as is possible on other mobile platforms…Unfortunately, with little notice, Apple changed the way it enforces its rules and this will prevent the current version of the Reader for iPhone from being available in the app store. We opened a dialog with Apple to see if we can come up with an equitable resolution but reached an impasse at this time. We’re exploring other avenues to bring the Reader experience to Apple mobile devices. We know that many of you are eagerly awaiting the application and we appreciate your continued patience.”

Sadly, there is no way to get an app on an iOS device without distribution in the App Store. Sony will have to built up a mobile Website to get around Apple’s restrictions.

Are several major apps in danger?

If this isn’t a mistake, and it may not be, it means that a number of high profile apps are in danger of being removed from Apple’s store, including other e-reader apps like Amazon’s Kindle and Barnes & Noble’s Nook. Both of these apps allow readers to buy books from outside of the App Store and read books from a synced digital library that’s accessible from a number of devices. If carried to fruition, this change in policy could mean the removal of all retail-oriented apps that sell digital goods outside of iTunes.

Newspaper and magazine apps may also face difficulties with this policy. If you purchase a subscription to a newspaper outside of Apple’s App Store (a common thing), you may not be allowed to redeem your app without paying to view it again on the iPhone/iPad. Apple may not care either, hoping to drive sales to iOS exclusive newspapers like The Daily.

Video download or streaming apps could also come under scrutiny by Apple if it takes this new policy to the extreme. Movies and TV shows sold through apps would have to go through iTunes in-app purchasing as well. It is unknown if such a conflict would extend to a service like Netflix or Hulu, which offer unlimited streaming of a pool of titles for a monthly fee.

In a networked world increasingly built on cloud computing, syncing, and sharing data, this rule is a step backward in connectivity.

It is news like this that makes me happy I currently own an Android phone. What do you think? Is it right for Apple to assert this level of control? Or is it another situation where, if we don’t like it, we should go someplace else?

Update 1: Added a bit about Netflix and video streaming apps.

Update 2: The WSJ reports official comment from Apple spokesperson Trudy Miller. “We have not changed our developer terms or guidelines,” said Miller. “We are now requiring that if an app offers customers the ability to purchase books outside of the app, that the same option is also available to customers from within the app with in-app purchase.”

This means that Apple is not requiring you to purchase items through Apple, but developers must offer the choice of purchasing through the iTunes in-app purchasing system. It appears that Sony may have misstated the facts a bit. The move is also somewhat confusing as Amazon does not use in-app purchases in its app. Will it be forced to change its app? This appears to be a clever way for Apple to get a 30 percent cut of all in-app purchases.

Showing 9 comments

Trevor Whitlock at 9:57am 14th February 2011 If Apple allows Sony and others to sell outside the store, the app store may become obsolete through sales outside of the store, look at mabilo w/ droid, free music ringtones, why buy the milk when the cow comes free??
Trevor Whitlock at 9:57am 14th February 2011 Apple's store is a median between the buyer and "wanted material" Apple probably needs to keep their numbers up and Sony would be able to sell outside of the app store without paying Apple, Sony is an elite company(means they usually get their way with bullying tactics, the only problem is Apple isn't having it and big enough to defend itself. Sony already overcharges for product to rake in massive amounts of revenue, so the buyers would not go with it after Sony tacks on Apple's "finder fee."
ioman at 12:43pm 1st February 2011 Another thing worth pointing out. We all can point fingers at Apple and get upset by this move, but the truth is that it's a smart business decision. Likely the reason why the Apple Store is trouncing the Android store in terms of revenue and available apps. It doesn't make sense to offer a platform unless you are making money off of it some way. Otherwise it's considered open source, and no one makes any money!
1. Jeffrey Van Camp at 1:42pm 1st February 2011 Very true Rachel and Ian. Everybody should make money, but every app and developer should be held to the same, non-shifting standards. Hopefully Apple will apply this across the board and not single anybody or any type of app (books, for example) out.
andrew at 9:29am 1st February 2011 It seems like it would also affect apps like Netflix as well! Crappy move on apple's part!
1. Jeffrey Van Camp at 10:04am 1st February 2011 Very good point! Netflix content could come into conflict with iTunes movies. I will add that into the article. The difference, however, is that Netflix doesn't sell videos. It's an all or nothing package.
  1. ioman at 11:12am 1st February 2011 My understanding is that Apple just wants people to have the option to buy their books through the iTunes store (Kindle App) in addition to buying it from Amazon. I haven't had a chance to sit down and test this, but my guess it's for ease of use more than anything. When you buy a book from the Kindle app, does Amazon require that you put all of your personal information and credit card info in there?
    Jeffrey Van Camp at 11:22am 1st February 2011 Apple reps have commented a bit, but it's still unclear about the policy. The Kindle gets around the requirement to buy books through iTunes by opening up a browser window, from what I understand. But the Sony Reader app wasn't doing that. If it goes through the app, Apple wants a 30% cut. What I am still confused about is whether Apple is forcing Sony to only link to the iTunes book store for book purchases. What point would a retailer have in existing on the App Store if they are forced to link to Apple's content?
    Rachel at 12:10pm 1st February 2011 A surprising number of users get complainy if things they buy 'on the iPhone' don't show up in their e-mail. ("I bought item X from in the Sony iPhone app and I got charged for it, but it wasn't on the 'Things you bought' report I get from Apple! They're hiding purchases from me!") Things like Amazon's shopping app or eBay and such, no one seems to get confused over. But things where you're buying stuff to use on the phone from in an app on the phone, a large number of non-techy users get very upset if those purchases don't show up on their purchase summary e-mails (or don't use their iTunes billing info). So my take -- as a developer who's seen the sort of complaints users make! -- is that a lot of the motivation is likely to ensure consistency of user experience. (Though no doubt Apple's not exactly upset about getting a 30% cut of all in-app purchases, either.)