• Apple May Provoke Anti-Trust Issues With New App Store Subscription Policy

    Within hours of Apple unveiling its new App Store subscription policy for digital content publishers wishing to provide subscription based materials through the App Store, suspicions are mounting that Apple may have effectively placed itself squarely into an anti-trust dilemma over its characteristically stringent control preferences.

    Within hours of Apple's announcement Tuesday, law professors who spoke with the Wall Street Journal alleged that Apple's new subscription service "could draw antitrust scrutiny." The reason is rooted in how Apple will allow content publishers to sell subscriptions through the App Store. To begin with, Apple demands all subscriptions be sold through the App Store. As a result, if a magazine wants to publish to the iPad in the form of an app, the publisher cannot include in the app a link back to the website where the subscription is also sold. You see, Apple nets a 30% share of any subscription it manages to sell through the App Store. That's why Apple is also stipulating that publishers cannot offer their subscription elsewhere at a price different from that which is advertised through the App Store.

    "My inclination is to be suspect" about Apple's new service, said Shubha Ghosh, an antitrust professor at the University of Wisconsin Law School. Two key questions in Mr. Ghosh's mind: Whether Apple owns enough of a dominant position in the market to keep competitors out, and whether it is exerting "anticompetitive pressures on price."
    For now, Apple is not offering comment on any potential antitrust implications. And for that matter, neither is the US Justice Department. But it's clear from the initial wave of reactions to Apple's new subscription policy that more than one legal challenge to its apparent "anticompetitive" nature could follow.

    Wall Street Journal
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