June 10, 2011 12:07 am

Apple eases subscription charging rule

Apple has relaxed a new rule that would have limited how media groups that charge for subscriptions can reach their customers on the iPad and iPhone.

The rule, due to come into effect at the end of this month, had drawn strong protests from newspaper publishers, online music services and others.

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But Apple did not back down on other issues that have drawn complaints, such as the 30 per cent share it plans to take of subscription fees collected through its App Store and its reluctance to pass on data about subscribers to media companies.

“We’re not done yet. Apple has not satisfied the concerns,” said James McQuivey, analyst at research firm Forrester.

The Financial Times this week became the first big news organisation to launch an app for Apple devices that bypasses the App Store. Other media companies that have been working on similar “web apps” are unlikely to abandon their plans because of Apple’s concession, said Mr McQuivey.

Under the rule released to developers this week and first reported on MacRumors website, Apple has dropped a restriction that would have prevented media companies from charging more for a subscription sold in the App Store than they charge in other places, including their own websites. The proposed limitation drew warnings that Apple risked prompting antitrust action.

“The big move today is that Apple has made clear that pricing is up to publishers,” said Gordon Crovitz, co-founder of Journalism Online, whose Press+ service helps publishers introduce paid content models. One leading magazine publisher said: “On the surface it looks good.”

The concession will make it easier for companies that obtained subscribers in other places to give them access to content on the iPad and iPhone under existing subscription deals, say industry executives.

Talks were likely to remain intense over whether Apple would make further concessions, particularly over access to data about users, said Mike McGuire, Gartner analyst.

Additional reporting by David Gelles

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