The battle of Apple and Google subscriptions

Two different models and two different philosophies, but which of the US giants will win out?


But why would Apple want to become enemies with the music industry, one of its best friends until a few days ago?

Various theories exist.

However, some prestigious publications have been adventurous enough to publish their own hypothesis. Among them is music magazine Billboard, which wrote: "The bigger question now is whether this is just Apple's way of taking a cut of a knowingly kneecapping other streaming music services in preparation to launch its own streaming music service for the iPhone in the coming months?"

Only time while tell if this is really a strategic movement by Apple, paving the way for a streaming Itunes.

News now

The music industry was not the only one to respond negatively to Apple's subscription system.

The International Newsmedia Marketing Association (INMA) hosted a summit in London last Thursday to discuss the future of information consumption through smartphones and iPads.

Executives from almost 60 news organisations, including the Daily Telegraph and Le Monde, were present, and they published a joint statement at the end of the summit in which they criticised Apple.

"The audience is frustrated by the unclear rules and uncertainty of doing business with the biggest player in the market," the statement said.

"Publishers simply can't afford to invest in new technology, products and services when the platform charges them 30 per cent of total revenue which in Europe, after VAT, can approach 50 per cent."

Grzegorz Piechota, president of INMA Europe, said before taking any antagonistic actions, publishers planned to talk to all technology providers, platform providers, and other stakeholders.

The Financial Times, which had had excellent relations with Apple traditionally, also expressed its distain about the new subscription system. The newspaper, which received 10 per cent of its online subscriptions via iPads in 2010, was said to be worried about "the changes to an approach that has so far worked well for our readers and the broader publishing ecosystem around tablet devices, and that may compromise our business model."

Even Vodafone seemed to react negatively to Apple's move. Its CEO, Vittorio Colao, accused Apple during Mobile World Congress in Barcelona last week, of having created a "walled garden" around content, which he said was concerning him. When contacted by IT PRO, Vodafone declined to comment first and then said Mr. Colao's words were taken out of context by the journalists involved.

Apple had no comment about Colao's criticism, what the Financial Times had to say or even the in relation to the statement by the INMA.

Nor did Apple have anything to say when we asked it how it could justify the 30 per cent margin it would be keeping of the transactions, or the restriction imposed to publish when it comes to set the price it finds pertinent for the content it sells on its websites.

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