Google One Pass Balances Aggressive Apple Subscription Model

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.