Hopefully every (re)seller on the planet is now aware that they should not attempt to build a marketplace on the IOS platform without getting a licence agreement with Apple.
I'm very interested in seeing how Netflix and the Kindle play out on the iPad though. If Apple gets too agressive in trying to lock down revenues, they may just end up driving people off their platform on to Google's.
Thank goodness for competition - can you imagine if the iPad was the only tablet option for the next couple years. At least this way, Apple will have to exercise some restraint.
Sorry for taking this off topic, but this is the perfect example of a comment where it would be very interesting to see how many hners that upvoted this opinion. I was one of them, since I believe it is a preferrable position to take. But it would be very interesting to see on what magnitude it resonates with the community as a whole.
Downvotes accepted as retribution for me going meta on this conversation.
I'll admit to having edited it half a dozen times to appropriately capture the nuances. As a Silicon Valley professional (Started at Netscape in 1996), and a huge fan of Apple Products (I'm typing this on an MacBook Air in a Redwood City Coffee Shop, I tracked my workout this morning using GymBuddy on my iPhone4, and I read Practical Programing for strength training last night on my iPad2), yet at the same time not unaware of how much damage a Monopolist can do (I believe that they eventually stifle innovation) I wanted to toe the fine line between being a hater, a realist, and, because we are on YC, effectively communicate the market realities of building on someone else's platform.
I also always keep grellas, patio11, and tptacek in mind when reviewing tone to keep out snark or discourtesy, and maximizing content.
I love my iPad too - but after playing with the new 10.1" Galaxy Tab for a few hours (thank you, Google IO), I think I'd now recommend an Android tablet over an Apple one (for just the kind of BS App Store policies being enforced here).
only needs to be available as an in app purchase if the app itself has a way of enabling you to purchase same content from outside the app (for example, a "subscribe now" button that links directly to a purchase page in Safari). I'm not sure where just a "you can subscribe from our website", sans link, would fall, but I'd hope that would be ok.
If it's available for purchase/download elsewhere it also needs to be available in-app for the 30% fee. It can't be priced higher in-app. That is the dilemma for the retailers.
Here are the choices:
1) Pull out of IOS completely
2) Lose money on all in-app purchases and hope that you make enough in direct sales to stay in business
3) Raise prices everywhere so the 30% fee doesn't hurt so much
Option #2 is just not realistic. It could be a very tough call between #1 and #3. The IOS store probably has enough critical mass that a business could lose substantial sales by ignoring it. The bigger risk is allowing an opening for a new entrant to come in, build a business in an untapped market and eventually be a tough competitor. Option #3 basically screws all your customers- even if they've never even heard of the IOS stores- so Apple can line their pockets.
It's a really crummy policy. It's either going to hurt businesses, who stand to lose sales or even go under, or it's going to hurt customers who will have to pay higher prices as a result.
(4) negotiate a deal where they get more then 30%.
(5) negotiate to remove DRM and operate as a Web App.
(6) change business models to subscription.
(7) license the app part of the business model to another company not involved with your store. That company can then pursue anti-trust claims against Apple if disallowed since they have no ability to offer the items for sale.
(8) add more value with your product i.e. get a better business model then "I'm gonna get rich being an additional middleman of ebooks"
No, I believe this is only true if you provide a link from within your app. For example, as long as Amazon's Kindle app doesn't have a link to the Amazon Kindle bookstore, they don't have to support in-app purchase (and hence don't have to give Apple a cut).
The App Store Review Guidelines  state pretty clearly:
Apps can read or play approved content (magazines, newspapers, books, audio, music, video) that is sold outside of the app, for which Apple will not receive any portion of the revenues, provided that the same content is also offered in the app using IAP at the same price or less than it is offered outside the app. This applies to both purchased content and subscriptions.
11.14 Apps that link to external mechanisms for purchasing content to be used in the app, such as a “buy" button that goes to a web site to purchase a digital book, will be rejected
There are all sorts of gray areas here that Apple will have to get called out on.
Third party payments are a great example. Say I sell an app that lets you pay for movie rentals at a RedBox kiosk that does so by letting you select and purchase on your phone/tablet and sending the right instructions to the RedBox servers so that your rental is prepaid when you arrive at the box.
Do I owe 30% of what was paid to RedBox even if I as the app developer am not RedBox?
Then let's talk declining balance accounts, a subcategory of the above. For example, your lunch money account at college. Your mom might put $500 on that account at the beginning of the school year from her home computer. You then use your phone in the food areas on campus to pay from your lunch account.
Is this considered a virtual currency and therefore Apple gets 30% every time you pay for lunch? It definitely is based on how I read Apple's agreement.
It's their platform, they can do what they want with it. Nobody's telling Microsoft they're "anti-competitive" because they have a lock on the Xbox marketplace, nor Sony and their exclusive relationship with PSN.
It's anti-competitive when you're talking about an essential service. The case against Microsoft was about Windows since at the time 95% of all computers used some form of Windows and they had a virtual lock on the market. Generally you need to be in a monopoly position to be considered anti-competitive. See also: Standard Oil, IBM, AT&T.
There is only one fundamental requirement: that the company's actions be anti-competitive. It is not necessary for the company to have a monopoly or even a majority share of a market (though these are factors). Furthermore, ownership of the platform is a significant antitrust factor because it drastically ups the risk and concern for anticompetitive behavior. (The Disneyworld analogy brought up below does not apply. Not only does it mix up antitrust law with property law, it ignores the crucial distinction between Apple and Disney: Apple openly invites others to participate in commercial activity on their platform, whereas Disney does not.)
Standard Oil, AT&T, and Microsoft may be the marquee cases, but they're not representative cases of the extent of antitrust law.