location based blog: declared

Tuesday, February 1, 2011

Apple Just Declared War On Amazon Kindle (AAPL, AMZN)

tim cook

A change in enforcement of Apple's app policy could force Amazon to take its popular Kindle app out of the iPhone and iPad App Store.

Apple is trying to funnel all payments for digital goods through its iTunes store, preventing companies like Amazon from collecting sales through its own channels without giving Apple a cut.

Up until now, Kindle iOS app users could buy a book on the web, then send it to their iPhones, or iPads. They could not buy the book from within the app.

That's changing. Apple is going to force Amazon to offer users the option of buying the book in the Kindle app.

Apple spokesperson Trudy Miller tells us, "We are now requiring that if an app offers customers the ability to purchase books outside of the app, that the same option is also available to customers from within the app with in-app purchase."

How is this going to nuke the Kindle app? Because Apple takes a 30% cut of every in-app sale. There's no way Amazon is going to pay Apple a 30% tax on every Kindle eBook sold on an iOS device. Therefore, Amazon could just abandon Apple's store instead of paying up.

Alternatively, it could view the 30% tax as a cost of business, and just play along. Or, it could make the button for purchasing in-app tiny, and the button for purchasing on the web through Amazon huge.

The controversy over in-app purchasing erupted when Sony revealed Apple rejected its e-reader app. Sony says its app was rejected because it didn't offer the in-app payment option. If Amazon follows suit, it could be rejected, as well.

We're emailing Amazon for a comment, and will update you if we hear back.

Join the conversation about this story »

Apple Just Declared War On Amazon Kindle (AAPL, AMZN)

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Friday, November 26, 2010

Mark Zuckerberg And An Army Of Insurgent Entrepreneurs Just Declared War On The TV, Music, News, And Movie Industries

Mark Zuckerberg at Web 2.0

At the Web 2.0 conference in San Francisco last week, Facebook CEO Mark Zuckerberg gave a six minute speech about how, starting sometime in the next five years, he expects his company to make billions and billions of dollars turning the TV, news, film, and music industries upside down.

The speech was nuanced and obviously pre-planned. It contained big revelations. But because it came in the middle of a wide-ranging, hour-long interview, hardly anybody noticed.

The gist: As has already happened in the gaming industry – where Zynga now has a larger market cap than Electronic Arts – Facebook expects insurgent entrepreneurs to "reform" the film, TV, news, e-commerce and music industries with the help of Facebook. Some of these companies will be incumbents. Some will unseat incumbents. Facebook will then – perhaps through credits or advertising, but also perhaps some other way – tax these companies in exchange for the value it has added.

Here's how Zuckergberg put it:

"Anything that involves content or specific expertise in an area – games, music, movies, TV, news, anything in media, anything e-commerce, any of this stuff.

Over the next five years, those verticals are going to be completely re-thought. There are going to be some really good businesses built.

Our view is that we should play a role in helping to re-form and re-think all those industries, and we'll get value proportional to what we put in. In gaming, we get some percentage of the value of those companies through ads and credits. But that's all because we're helping them.

If we're helpful to other industries in building out what would be a good solution then there will be some way we get value from that. "

In the next few days, we're going to publish a speculative story on how Facebook can "reform" those industries the way it has been able to funnel hundreds of millions of users into social gaming. We'll be talking about some of these issues at our Ignition conference next week too. We'd love to hear your thoughts, too. Comment below or email us at Nicholas@businessinsider.com.

In the meantime, we've embedded Zuckerberg's speech here: