Everyone Loses in Apple's App Store E-Reader Battle

New rules make it more difficult to read books on iPads

iPadsters looking to download fresh reads using their Kindle, Nook, or Kobo apps can no longer purchase e-books directly from their iPad's app store. Apple has begun enforcing its new in-app subscription rules, demanding a 30 percent cut for all sales directly from e-reader apps. Content providers like Amazon and Barnes & Noble don't want to pay up, so instead of giving Apple a cut of their sales, they've removed links to their shops from their apps, informing their customers that they must purchase their titles from a web browser and then download it to their device. Under this compromise, Kindle, Nook and Kobo get to keep their apps in the Apple store and you still get to read on your slick iPad. So everyone's okay, right? Or not. It looks like everyone involved loses something in the e-reader app store battle.

Customers lose. It's far more inconvenient for iPad users to get reads on their devices. Instead of purchasing directly from the Apple's app store, readers face a lot more clicks and cables to get to new books. "To buy Kindle books, iPad users must now open a Web browser on their own, type in Amazon's address, and sync their apps after making a purchase," explains PC World's Jared Newman. Some dexterous tech savvy folk may not mind the extra tapping, it's a difference of a few seconds, but others, as Epicenter's Tim Carmody points out, will find the process quite cumbersome. "They can use their own web sites and control their own destinies, but that’s slow and more importantly, cumbersome for customers who would overwhelmingly rather pay for and read content in as small a number of places as possible." For iPad users, one of the benefits on having a Kindle app is convenience. Not only does it allow users to minimize their e-reading subscriptions--they could of course switch over to Apple's iBooks--but the app used to make it easy to sync their reads. Now, it's much more difficult.

Apple loses. Apple really wants e-reader companies to shell out the 30 percent of each sale. Instead, these content providers are opting out of the App Store ecosystem and that's lost revenue for Apple. Apple gets nothing besides continued readership on their devices. And not only do these companies avoid paying up, but this could be a good strategy for their growth, especially in periodicals, argues Carmody.

Apple’s new rules haven’t knee-capped Amazon in the slightest. Far from it. In fact, Apple’s given them a gift — and many other companies too, some of which may not even exist yet.

Publishers now have a much better reason to partner with Amazon in addition to or rather than Apple for periodical sales. Periodicals used to be completely absent from Kindle’s iOS apps. I’m sure that wasn’t Amazon’s decision — publishers didn’t need Amazon to easily get their content on the iPad.

Now, Amazon looks a lot more attractive.

Also, added bonus for Amazon: if the company succeeds in getting people to use the Kindle app to read, in spite of these restrictions, they could convince their devoted readers to switch over from an iPad, to a similar Amazon device. "Also — sotto voce — if more customers start using Kindle to read The Economist (or whatever) on the iPad, why wouldn’t they read the same media on a future Amazon tablet," guesses Carmody.

E-reader companies lose. So they don't have to give Apple a 30 percent cut of all sales, but they didn't abandon ship completely.

Despite predictions that Amazon and other content sellers might pull out of the App Store entirely, most of them are sticking around. While they'll certainly lose some business by eliminating an easy path to their Web stores, the iOS user base is apparently too big to pass up. In other words, Apple wins, even if that means a minor loss in functionality for users.

The new restrictions make it more difficult to buy books, which will undoubtedly cause Amazon and Co. to lose some customers.

And with iBooks as the only iOs app that allows people to buy directly from the app store, what will stop annoyed customers from abandoning their Nook app for iBooks, CNET's David Carnoy points out*. "When all is said and done, Apple's iBooks will be the only iOS app that will allow you to buy e-books directly from within the app. But at least Apple has allowed e-reading apps from other companies to remain in the App Store. You can choose to see that as a magnanimous gesture--or not."

But maybe Apple's dominance isn't so bad. At least that's how TechCrunch's John Biggs sees it, "As someone who despises the current publishing industry, I’m glad Apple’s cracking down on folks who have had it too good for too long."

*This post originally attributed the quote to Jared Newman.