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Tuesday, February 08, 2011, 07:00 pm PT (10:00 pm ET)

European publishers upset over Apple's iTunes subscription fees, restrictions

A group of European newspaper publishers has warned Apple that a 30 percent commission on iTunes subscription revenue and restrictive conditions would be unfair, according to a new report.

The BBC reports that the European Newspaper Publishers' Association has expressed concern over Apple's revenue split for iTunes digital periodical subscriptions and possible restrictions limiting whether iPad users can subscribe to a periodical through the company's own website.

The ENPA warns that Apple is demanding too large a cut of publishers' profits while potentially banning newspapers from taking subscriptions via their own websites.

"Consumers may only have access to the newspaper of their choice via the iTunes store, where the transaction would be subject to commission," said the ENPA in a statement.

"Newspaper publishers should have freedom of choice of payment systems for their readers and the possibility to negotiate pricing levels for their digital publications," the statement read.

Apple announced an in-app subscription service for its App Store last week alongside News Corp's The Daily digital newspaper. Regarding the service, iTunes chief Eddy Cue said Apple would provide more details in the near future.

Prior to The Daily's launch event, reports emerged that Apple had denied an eBookstore app from Sony on the grounds that its in-app sales were not routed through iTunes. However, Apple denied the claim, asserting that its developer terms or guidelines had not been changed.

"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," said Apple spokesperson Trudy Miller.

According to News Corp CEO Rupert Murdoch, The Daily, which will be the first iOS app to utilize the new subscription feature when it goes live, has the usual 70 - 30 revenue split agreement with Apple for the first year, though Murdoch expressed hopes that future negotiations with Apple could diminish its cut.

European publishers apparently feel "betrayed" by Apple and are planning a summit for later this month to "compare notes" on Apple's subscription rules for iOS.

According to Grzegorz Piechota, the European president of the International Newsmedia Marketing Association, Apple has been inconsistent in how it has communicated and implemented its new policies.

“Apple said…that in their policy with Sony Reader, they are not changing anything, just enforcing existing rules. But when they talk to publishers direct, they are saying something else," said Piechota.

“Apple has been contacting some publishers, and not contacting some. Some get emails, others get informal phone calls,” he continued. “The whole process of accepting or rejecting apps is not transparent. It’s very hard to explain why some apps are being accepted and some are being refused; some apps allow you to read content that is bought somehwere (sic) else and others that won’t let you do this.”

Last month, Belgian economy minister Vincent Van Quickenborne called for an antitrust probe of Apple on possible abuses by the iPad maker to dominate the newspaper market.

Last year, US publishers expressed frustration over the lack of an iPad subscription feature. Conde Nast, Hearst and Time have all been mentioned as being in discussions with Apple, though a deal has yet to be reached, according to a report by The New York Times last month.