Paying the internet's pipers
Posted in: Mobile & Wireless at 19/02/2011 20:26
Getting consumers to cough up for electronic newspapers, magazines, videos and other content has become much easier thanks to the spread of smartphones, tablet computers and other such revolutionary gadgets. But content producers and tech companies are still haggling over how to share the spoils -- in terms of hard cash and valuable information about customers -- that such sales generate. This week Apple and Google unveiled competing digital-subscription services that differ from one another in several significant and controversial respects.
One is the amount of money that ends up in publishers' coffers. Apple's new subscription service for digital media, based on its iTunes platform, gives 70% of the revenue generated from sales to publishers, whereas Google's new "One Pass" system lets them keep 90%. Apple also insists that prices publishers charge the same price (or less) for their in-app offerings as they do for those offered via other channels. Google, on the other hand, says publishers will be free to set their own prices and terms in One Pass. (Some in the publishing industry speculate that Apple's determination to influence pricing of subscriptions outside the app store, as well as within it, could attract the attention of anti-trust watchdogs.)
To read this report in The Economist in full, see: