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It's because in-app subscriptions are really just recurring in-app purchases that can be cancelled at any time.

If you accept that the 70-30 split is acceptable for sales of apps, by logical extension you must accept that the 70-30 split is acceptable for in-app purchases, because technically one could provide a free app with an in-app purchase to make it a full app, and anything less than 30% on Apple's take would gravitate the market toward this model.

If you accept that 70-30 is fair for in-app purchases, then you must by logical extension accept that recurring in-app purchases that can be cancelled at any time would also have this split, because technically one could provide all in-app purchases at a steep discount simply as "subscriptions" that can be cancelled after the first payment.

As far as I can tell, this is Apple's reasoning and rather inescapable at that.

I don't think that's a logical extension, personally.

However, I think Apple could say that a subscription purchase was 85-15 or 90-10 and they would have gotten this in with little push back.

Or even required that subscription apps cost $9.99 for the initial purchase ($9.99 is a number from my head with no basis in reality) and a following 90-10 split, or requiring that apps with a free initial release go to a 70-30 split on subscriptions. I really think they could have done that and not had a major revolt on their hands. They may not have made the same in the short term, but I think they would have had a better response and a better long-term hold on small developer and publisher loyalty to their platform.

I would personally buy a Palm Pre 3 if it had Instapaper and Kindle and the iPhone 5 didn't. I would venture that their are numerous other consumers who have similar preferences.

[Edited for clarity]

Could you elaborate on why you don't think the parent comment has a point?

I don't agree that Apple's rules have to be structured the way they are. I do agree that if one merely extrapolates out the current structure, then the rules make sense, but I don't think it's a logical extension of how it has to be.

I don't think anybody would buy a Time magazine app for $9.99 (or whatever the offset amount) just for the option to purchase a cheaper subscription, let alone spend an extraordinary amount of time becoming informed about the various price differences.

The 70-30 cut alone might be acceptable, but what makes it ludicrous is that the developer is forced to offer the in-app purchase option for external services like Instapaper, which are not in any way tied to the iOS platform. I mean, what's next? Should Evernote, Remember the Milk and Dropbox, to name a few, all be forced offer an in-app subscription with 30% Apple cut just because they happen to have an iPhone client among other clients?

Fair point. I think it comes down to the potential loophole that could be exploited whereby an app is offered for free but the full version can only be activated by clicking a link and following a separate payment flow that deprives Apple of 30%. This could also pose a long term usability problem.

App Store reviewers can and should be able to tell the discriminate between an app like the one you're describing, and say Evernote of Flickr which are perfectly usable without a paid subscription.

What about Netflix?

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