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Thursday, June 09, 2011, 04:55 am PT (07:55 am ET)

Apple backs down on in-app purchasing rules, allows lower prices for out-of-app purchases

Apple this week revised its rules for in-app subscriptions, and no longer requires that subscriptions purchased outside of an iOS application have the same price or less.

Under the old rules, Apple required that subscriptions sold outside of the App Store umbrella, where Apple does not receive a 30 percent cut, be "at the same price or less than it is offered outside the app."

But, as noted Thursday by MacRumors, the new App Store Review Guidelines unveiled at the Worldwide Developers Conference this week have removed the need for prices to be identical out of the App Store. Apple only requires that "there is no button or external link in the app to purchase the approved content."

The change will likely mean that content providers like Amazon, which sells e-books through its online store for use in the Kindle application, will be unaffected by the previously-set June 30 deadline. Under Apple's previous rules, Amazon would have been forced to offer the option of purchasing content within the Kindle application at the same price, while paying Apple a 30 percent cut of the sale.

One the App Store rules for subscriptions and in-app purchases were unveiled, Apple announced that legacy applications approved before the changes would have until June 30 to comply with the new rules. That meant software like Amazon Kindle, Nextlix or Hulu+ originally had until the end of the month to add a "buy" button and give Apple a 30 percent cut of sales, or they could be removed from the App Store.

Apple's new rules, detailed in section 11.14 of the App Store Review Guidelines, make it clear that approved iOS software "can read or play approved content (specifically magazines, newspapers, books, audio, music, and video) that is subscribed to or purchased outside of the app," provided there is no link to purchase that content elsewhere at a lower price. "Apple will not receive any portion of the revenues for approved content that is subscribed to or purchased outside of the app."

App Store


Apple's change of opinion comes soon after one prominent content provider, the Financial Times, decided to create an HTML5-optimized website rather than submit to Apple's in-app subscription rules and give the company a 30 percent cut. By offering its product in the Safari Web browser, the newspaper would be able to avoid paying Apple 30 percent of its revenue for subscriptions through the App Store.

The Financial Times application was highlighted in 2010 at the WWDC Apple Design Awards. The iPad application was recognized as one of the best pieces of iOS software, ranked based on design, technical excellence, innovation, quality, technology adoption and performance.