Google one-ups Apple with One Pass content purchase solution
With publisher frustration mounting over the financial terms of Apple's (NASDAQ:AAPL) new App Store digital content subscription platform, archrival Google (NASDAQ:GOOG) introduced its rival One Pass service, promising publishers the flexibility to establish their own pricing and conditions. As its name suggests, One Pass offers consumers a single sign-on email and password to purchase digital content across mobile applications and the web--according to Google, the service helps publishers authenticate existing subscribers so that readers don't have to re-subscribe to access their content across new devices. Google One Pass publisher partners can customize how and when they charge for content, trialing different pricing models including subscriptions, metered access, freemium or a la carte--publishers may also offer discounts to existing subscribers. Google will manage all transactions, employing Google Checkout to process payments.
"Our goal is to provide an open and flexible platform that furthers our commitment to support publishers, journalism and access to quality content," writes Google Commerce director of business product management Lee Shirani on the Official Google Blog, further suggesting that Google One Pass is a direct response to Apple's new App Store subscription platform, which gives Apple 30 percent of resulting revenues as well as ownership of consumer data like names and email addresses. By contrast, Google claims 10 percent of the purchase price and will share the customer's name, ZIP code and email address unless the consumer instructs the digital services giant not to. And while publishers selling content within an application running Google's Android mobile operating system must still share 30 percent of revenues per terms of the Android Market storefront, Google One Pass will allow publishers to avoid selling inside the app and instead direct customers to the web, where the 90/10 split remains in effect--Apple said publishers may no longer provide external links in their iOS applications to allow the customer to purchase content or subscriptions outside of the app.
"This is purely a shot across Apple's bow at a critical point in time," Forrester Research digital media analyst James L. McQuivey told The New York Times. "That's what the industry wants right now, to know there is an alternative to Apple and someone willing to talk about a more reasonable rate."
Many publishers have expressed doubt and concern over Apple's subscription model. The terms also pose tough decisions for digital media service providers like Amazon.com and Netflix--for example, the new guidelines subject the sale of an Amazon Kindle magazine subscription or ebook download to the 30 percent transaction fee if the publication is purchased via the App Store. Kindle titles downloaded directly via the Amazon.com web store or video subscriptions purchased from the Netflix site remain exempt from Apple's terms of service. Apple is also reluctant to share subscriber data. The computing giant said it will hand over some information with a subscription purchase, provided consumers consent.
UBS analyst Brian Fitz speculates Apple's latest moves could raise the question of antirust violations. "It is possible that regulators will look into them," Pitz said. "And I think competition and pressure from others will push Apple to open up."
- read this Official Google Blog entry
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