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Google may introduce in-app purchasing to compete with Apple's model (Updated)

Google may debut its new in-app purchasing and subscription system to compete with Apple's controversial model. Similar to Apple, the Google system would let users purchase upgrades and other digital content within an application using Android's built-in payment system, Google Checkout. The new system for Android would give developers a 90 percent cut, while Google would grab the remaining 10 percent. This revenue split is more attractive than Apple's current 70:30.

Google is reportedly rolling out this system as soon as today and is possibly introducing it early to capitalize on the dissatisfaction that is brewing over Apple's recent changes to its subscription and in-app purchasing policy. These changes now require content providers like Amazon to offer in-app purchases of content that is offered for sale via another channel. Application developers have until June 30 to comply with this new requirement or risk having their application removed from the App Store.

This change would affect a wide variety of applications including the Kindle app, Hulu, Rhapsody and others. Rhapsody has already responded negatively to these changes, and other developers may follow suit. Will Google's Android model be enticing enough to get developers to jump ship or is everyone blowing this out of proportion?

[Update: The original rumor is slightly incorrect. It is not Google's in-app purchasing model that is rolling out today. Instead, Google announced its One Pass subscription service for publishers. The service lets publishers set their own rates for content, which will be accessible via the web, tablets and smartphones. In-app purchasing will be available but only through mobile applications that can process an in-app purchase outside of the app store (i.e., probably not iOS). Revenue sharing is set at 90:10, and the service provides direct access to subscriber's data. It is designed to help publishers promote and distribute digital content.]

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Google may debut its new in-app purchasing and subscription system to compete with Apple's controversial model. Similar to Apple, the...
 

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mhoney569

Today, technology is developing rapidly and it is good to hear that.



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February 19 2011 at 1:50 AM Report abuse rate up rate down Reply
Jon

Do Android folk even buy apps? Every Android user I know constantly brags about their ad-stuffed apps they paid nothing for.

February 16 2011 at 1:59 PM Report abuse rate up rate down Reply
farmboy

In other Google news, Larry Page changes his name to Sleeve Jawbs, announces extended leave of absence yet hangs around office. "Copy Apple? That's nonsense. Everything we do here is original and innovative. We think different, you know," said Mr. Jawbs in an email to a customer.

February 16 2011 at 11:12 AM Report abuse rate up rate down Reply
5 replies to farmboy's comment
Juhani

Isn't this old news? Android in-app-purchases was announced two weeks ago:
http://techcrunch.com/2011/02/02/android-in-app/

February 16 2011 at 11:03 AM Report abuse rate up rate down Reply
1 reply to Juhani's comment
Kelly Hodgkins

Google opened up the SDK for in-app purchases to developers a few weeks ago, but it was not available to the public yet. The circulating rumor suggested we would get more information about in-app purchases today. This feature was not expected to debut until this spring and I thought Google may be introducing it earlier than expected because of all the controversy over the Apple model.

Instead of in-app purchases, Google announced its One Pass subscription service. Once the Google info went live and I realized the discrepancy, I updated the post with the appropriate information.

February 16 2011 at 3:08 PM Report abuse rate up rate down Reply
ilkyone

that there is any kurfuffle over a 30% overhead is hilarious, because prior to Apple's entry, with a few exception of no-name things, everyone else was taking A LOT more than 30%.

Ever try and price out how much amazon used to charge for its overhead? 30% is a deal of deals. But even Amazon has relented to taking ONLY 30% now.

Google's business model is to remove any chain value... of course they have to react with a lower overhead because the product they offer is less than 1/3rd the value of the Apple or Amazon store front. Besides, Google's whole business model is to create places to put ads on your content. Creating a long term sustainable retail store front is not in their DNA, so it is typical for them to be the ones selling the merchandise out of the back of a truck pulled up to the gas station. 10% for that is fair.

To be in the prime place at the local hot spot takes a little extra cash, but it's worth it because you get actual consumers with money to buy things of value. 30% retail cut is VERY, VERY cheap.

Nobody would click the "subscribe" button in Hulu or in Netflix, even if they put one in there, anyway. Those services, like Amazon's are obvious large retailers of their own. But, let's run with the analogy here -- should Saks Fifth Avenue not get it's 70% cut of the materials sold from its retail floor? What if it's a Macy's item that Sak's sold to a Sak's customer in Sak's because Macy's wanted to make a wider market for the product by putting it into Saks traffic? Should Saks forgo any retail cut just because it has the "platform" that attracts buyers?

Google is the dollar store around the corner. Not the chain dollar store, but the weird one that has merchandise the chain dollar store liquidated for lack of movement. You know, the one that just came to the abandoned strip mall two blocks away from the Big Lots that just closed. That one. They can't leverage Macy's and Saks markups, but they can sell cheap knockoffs and make you feel like you got something for your buck.

February 16 2011 at 11:01 AM Report abuse rate up rate down Reply
3 replies to ilkyone's comment
Gwydion

It's not in app purchasing, which was announced a time ago, it's "Google One Pass, a service that lets publishers set their own prices and terms for their digital content."

http://googlenewsblog.blogspot.com/2011/02/simple-way-for-publishers-to-manage.html

February 16 2011 at 10:49 AM Report abuse rate up rate down Reply
1 reply to Gwydion's comment
Kelly Hodgkins

Thanks for the heads up. I saw that Google announced its One Pass service and its was a subscription service, not in-app purchasing. The source of the rumor made it seem it was the in-app purchases that were debuting today. Once the Google info went live and I realized the discrepancy, I updated the post with the appropriate information.

February 16 2011 at 2:57 PM Report abuse rate up rate down Reply
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