Wednesday, February 2, 2011

Apple Limits Book Distribution on iPad, are Netflix Movies Next?

photo by nebarnix

Yesterday it was reported that Apple started informing eBook app developers like Sony, that they will no longer be allowed to provide a free reader so that owners of 3rd party eBooks can read them on the iPad or iPhone.  The only way they can provide a free reader on the iPad or iPhone is if they use "in-app" billing within their app, so that all "in-app" purchases will flow through Apple.  Using "in-app" billing, Apple will take a 30% cut of all purchases, negating the profit made by companies like Amazon, Sony, and Barnes and Noble.

For now it seems like they are targeting eBooks, but can movies and other content be far behind?  Will Apple insert themselves in the Netflix subscription process, eventually causing Netflix to pass along the cost of sales to the consumer or drop the iPad and iPhone platform completely?

Cheaper-TV take: This is a big mistake by Apple.  It stinks of monopoly business practice and reminds me of the Tunisian government that was recently overthrown.  If you wanted to open a business in Tunisia, the first lady had to be your business partner.  If I were in the market for a phone or a tablet, I would take a hard look at the "open" Android offerings before committing to Apple and their "closed" business practices.