Company wants to encourage content creators to stay with Apple by improving margins.
The Financial Times reported on Friday that Apple is in talks with media companies to revise the traditional, across-the-board 30/70 revenue split that Apple imposes on sales of media within its ecosystem.
For the last decade, Apple has taken 30% of the revenue that app developers, publishers, and subscription services make on iOS. But sources told the Financial Times that Apple is considering taking less than that on content purchases, especially through Apple TV and Newsstand. App store terms will remain the same for developers, but media subscription services like Hulu and HBO Now, as well as publishers like Time, The New York Times, and Conde Nast, could stand to benefit. (Disclosure: Ars Technica is owned by Conde Nast).
“Changing Apple’s terms of trade could improve the economics of online content businesses and reassure regulators that the company is not abusing its position as gatekeeper to one of the most lucrative digital marketplaces,” the Financial Times wrote. In 2012, the Department of Justice filed suit against Apple in 2012 alleging that the company engaged in e-book price fixing. Apple lost against the DOJ, but it has appealed the loss. It also agreed to settlement terms in a class-action suit on the same issue last year.
The change could mean that Apple might forfeit “hundreds of millions” of dollars per year in in-app payments, but it would make Apple’s platforms more competitive for content creators. In April, Re/Code wrote that Apple has already extended a reduced revenue split to Netflix, Hulu Plus, and MLB.TV, taking only 15 % of monthly subscription fees made through Apple TV.
Reports ars technica