Analysts debate whether Google One Pass creates a viable alternative to Apple's subscription service, which could flirt with breaking antitrust laws in the U.S. and Europe.
Publishers'
eyes may have lit up when Google unveiled its One Pass subscription service
for tablets, smartphones and Websites, as the service provides a more
price-friendly alternative and more control over consumer data than Apple's own
subscription service.
However,
analysts agree that it is too early to tell which billing platform publishers
will prefer. Moreover, Google's arrival in the market may help Apple counter
arguments that its plan violates the spirit of antitrust law in the U.S. and
Europe.
Apple Feb. 15 unveiled
its subscription service to allow publishers to sell customers digital
magazines, newspapers and other content for Apple's iPad, iPhone and iPod touch
devices.
To be clear,
Apple's terms for the new service do not prohibit companies from selling
digital subscriptions on Apple devices on their own. Publishers who bring an
existing subscriber or lure a new one to an application keep 100 percent of
subscription sales. When customers subscribe to an application via Apple's
iTunes App Store, Apple collects 30 percent of the fee.
While some
publishers balked at the prospect of kicking 30 percent of sales to Apple for
the pleasure of soliciting consumers on an iPad or iPhone, Apple hedged the
process further. Publishers who do opt to use Apple's platform must also make
content available for sale through applications at the App Store for the same
price.
Because
subscribing to content through Apple's App Store is much simpler-requiring just
a few clicks-publishers are upset because they claim Apple is attempting to
funnel users toward buying content through its App Store.
Apple seems to
be steering consumers away from making transactions where Apple doesn't get a
cut, so regulators in the U.S. and Europe have taken notice. In the U.S., the
Justice Department and Federal Trade Commission are studying Apple's terms of
service, while the European Commission is monitoring the situation.
Enter Google,
as potential savior and/or beneficiary of the discontent Apple created. The
company Feb. 16 unveiled
One Pass to allow readers to purchase content from publishers using a single
sign-on with an e-mail account and password. Publishers can offer
subscriptions, metered access, and other custom content from their Websites or
mobile applications.
While Apple
takes a 30 percent cut from publishers, Google collects 10 percent of sales One
Pass publishers collect, leaving publishers with a much more palatable 90
percent of sales on every transaction.
Perhaps most
importantly, Google doesn't appear to be placing restrictions that shuttle
consumers to use One Pass. This is clearly a deliberate attempt to undercut
Apple's bid.
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