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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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