Alan Quatermain

The folks at Readability published an open letter to Apple today regarding their rejection from the App Store because they didn’t use in-app purchasing.

Having spoken with the developer, it transpires that there are no links and no exhortations to make purchases within the app. The cause of the rejection is a static-text label (in other words not a link) on the login screen:

The app’s login screen asked for the user’s Readability username and password and had a label at the bottom that said, “To sign up for a Readability account, go to Readability.com.”

Just information. Nothing about payments, costs, or anything else. Just a small sentence so that people who download the app don’t immediately go “muh-huh?” After all, there’s not really any other indication in the app that it’s part of a web service, and we know that an awful lot of shoppers don’t read the app store blurb on the apps they download.

Apple’s reviewers had to manually go to Safari and type in ‘readability.com’ and attempt to sign up in order to see anything about payments. That was enough: Rejected for making money without giving them a cut.

Readability is a software-as-a-service provider whose main service is that of reformatting existing web pages to make it easier to read their content amidst the plethora of advertisements; their technology actually forms the basis of Safari’s 'Reader’ mode. They also provide a 'read later’ system similar to that of Instapaper; in fact, Instapaper’s developer, Marco Arment, assisted them in the development of their new iOS app, which offers the ability to access that reading list from your iPhone or iPad.

Where Readability becomes quite unique, however, is in their attitude towards content publishers. Readability charges users an optional $5/month subscription, and sends 70% of a user’s subscription fees to the authors of the content that user reads using the service. This is great for authors, and it does a lot of good in the long run for the survival of these types of reading services, because now no-one can claim that Readability is taking money away from the authors by stripping advertisements: they’re paying good money to authors all the time.

They’ve in fact followed Apple’s lead here by taking a 30% cut, giving 70% to the authors. However, by doing so, they’ve now been bitten by Apple, which is demanding the same 30% cut which constitutes the company’s entire revenue.

Of course, there are ways around this. Readability (unlike most booksellers) has the ability to change the terms, and could give author’s 70% of their revenue. This would mean they get 70% of every $5 subscription from the site, or 70% of the $3.50 earned through In-App Purchases. However, it still goes to show that Apple either hasn’t thought these new terms through very well, or simply doesn’t care about service providers at all. My money is on the second one, since they have had an existing policy for such services in place (one which was actively enforced & recommended by the app review team) for a couple of years now.

In Apple’s ideal world, however, content creators either create their own applications individually, and incur almost-but-not-quite 100% of the costs associated with selling their content, or they just choose to sell their stuff through Apple’s own stores. Which, of course, only works if you’re selling books, videos, or music. And potentially limits your audience to only those who have iOS devices, unless you want to incur all those costs anyway just to sell to other non-iOS customers.

Remember: if you’re selling via Apple IAP, Apple only provides transaction processing. At about 10x the market rate. And if you use it for selling eBooks, videos, or music, you’re handing all your analytics to one of your top competitors.

The IAP terms are skewed very heavily in favour of Apple, meaning that for anyone competing with one of Apple’s side businesses (or for anyone with whom Apple has recently decided to compete) there are many valid business reasons for not choosing to go that path. That’s why it’s unfair of Apple to now mandate that we do so, or just close down our business.