Amazon Kindle, Barnes and Noble Nook and Kobo will soon be able to offer payments for digital content right on their own website and process payments, without paying Apple 30% of each ebook sold. This also includes other reader apps that sell audiobooks, magazines, manga and newspapers. This new system is planning on being implemented in early 2022. The only caveat is that these companies must not already offer in-app purchases or sell digital content, which basically applies to all of the big ebook retailers.
Apple says that prior to when the change goes into effect in 2022, the App Store guidelines and the review process will be updated to “make sure users of reader apps continue to have a safe experience on the App Store.” Apple plans to help developers of reader apps “protect users when they link to an external website to make purchases.”
Why is Apple making this change for reader apps? This is primarily due to a number of factors. Firstly, the Japan Fair Trade Commission (JFTC) launched a App Store investigation in June 2021 and a few months later, JFTC agreed to close its App Store investigation in exchange for changes to how “reader” apps operate. India launched a new antitrust case hours after Japan reached a settlement with Apple, while South Korea approved a bill to impose curbs on Google and Apple’s payment policies. Apple basically capacitated in order to stop all of these other countries from filing similar lawsuits.
While the agreement was made with the JFTC, Apple will apply this change globally to all reader apps on the store. This will be tremendous news for anyone that wants an easier experience to buy audiobooks or ebooks. Right now, if you want to buy a Kindle book. You need to open Safari, visit the Amazon Store, find the ebook you want to buy, purchase it, open the app and sync new purchases, there are many hoops to jump through. Starting next year, things will get easier.
How will this whole system work for Amazon and other digital content providers? Here is what we know. Going forward, it will possible to include an in-app link to their website for users to either set up or manage an account, and signup using a non-App Store payment method. Because reader apps do not offer in-app digital goods and services for purchase, Apple has agreed to let these apps share just one link to their website for “account management” purposes. So, it is not likely that Amazon will provide curated lists of ebook titles and provide direct links to the product listings on their website. But will it should be easier to have a direct link to the Kindle section on their website, make a purchase and then get automatically diverted back to the app and can start reading.
People have been reading this website, might already know that Amazon used to sell ebooks directly within their Kindle app until 2011 when Apple decided they wanted to handle all in-app transactions themselves and would not let anyone process payments outside of the App Store. Since ebooks are a low margin business with the lion share of each sale going to the publisher, Amazon would lose money on each sale, paying Apple their commission. So they decided to stop offering in-app payments and developed the Kindle Cloud Reader, which was a browser based solution to buy and read ebooks in Safari. Also in 2011, Barnes and Noble and Kobo also suspended selling ebooks and also introduced cloud readers, but they both discontinued them in 2016.
One of the big advantages Apple had, with this new policy change was the Apple Bookstore. They were the only ones that offered the ability to generate curated lists of books and sell them, directly within the app. A few years later they got into the audiobook business and users could view recommendations, view bestseller lists and make a purchase and listen to them, within Apple Books. This gave Apple a huge leg-up on the competition, since they were not taking 30% of each sale, which their competition couldn’t afford to pay. Even with this competitive advantage, Apple never gained serious traction and have always been a minor player in the US publishing industry, they were always in 4th or 5th place for e-commerce sales of audiobooks and ebooks, with Google, Kobo, B&N and Amazon above them.
Michael Kozlowski has been writing about audiobooks and e-readers for the past twelve years. His articles have been picked up by major and local news sources and websites such as the CBC, CNET, Engadget, Huffington Post and the New York Times. He Lives in Vancouver, British Columbia, Canada.