Apple blinks, Amazon links

From Mark Gurman’s “Apple Lets Some Video Apps Sell Shows Without Taking 30% Cut” posted Wednesday on Bloomberg News:

Apple Inc. has relaxed a controversial policy that took a 30% cut of payments when video apps on its platform sold TV shows and movies.

Amazon.com Inc. started taking advantage of the change on Wednesday, selling and renting movies via its Prime Video service on Apple devices without needing to give Apple a share of the money.

“Apple has an established program for premium subscription video entertainment providers to offer a variety of customer benefits,” the Cupertino, California-based technology giant said in a emailed statement… 

The program lets these premium services charge viewers via their own payment method instead of Apple’s in-app-purchase system, which takes a 30% cut. “Customers have the option to buy or rent movies and TV shows using the payment method tied to their existing video subscription,” Apple said in the statement.

My take: Changing business models in Services this late in the game is a big deal. Senator Warren, are you watching?

4 Comments

  1. Miguel Ancira said:
    I doubt that AAPL gave in. I think it is a wise move and one that will pay dividends in the future. I think everything that they do is carefully thought out and take into account the market fluctuations.

    8
    April 2, 2020
      • Fred Stein said:
        Gave both of you a star.

        Smart timing by Apple. Despite the human tragedy we’re facing, it’s a good time for premium video entertainment providers to open up and collaborate. Providers like Amazon already have the customer relationship and trust. So that part of Apple’s 30% App Store fee does not apply.

        There have been rumors about a new Apple TV hardware product. The last version, Apple TV 5th gen was announced in Sept 2017.

        2
        April 2, 2020
  2. Peter Kropf said:
    From the original article:

    “Apple said the program also provides a number of other benefits, including “integration with the Apple TV app, AirPlay 2 support, tvOS apps, universal search, Siri support and, where applicable, single or zero sign-on.”

    Notice the other benefits? They’re free to customers, but Amazon was required to code and test to support those benefits. It’s clear that is what Apple gets in return for the 30%
    tax Apple removed.

    1
    April 2, 2020

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