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Could Apple's In-App Subscriptions Derail iPhone MMOs?

Posted 2/16/11 2:45 pm EST by Adam Rosenberg in iPhone / iPad


world of warcraft

Yesterday, iDevice overlord Apple announced the introduction of in-app subscriber fees as an option for mobile software developers. To put it in simple terms, if there were a way to port "World of Warcraft" into a stable iPhone/iPad client -- and there actually is -- this new business model would allow Activision Blizzard to charge subscribers directly inside the app. You're probably thinking, "So what? You can just subscribe on your computer and load up the iClient, right?" The answer to that is... sort of.

See, Apple wants to levy a pretty hefty fee from those who offer subscription-based services in their apps. A 30 percent cut, to be exact. Any business that offers subscription-based content through an app, such as Hulu Plus or Netflix, must now operate within the new subscription model.

The 30 percent cut only applies to transactions made from the iOS device, but it also requires that a "Subscribe" button be made available to the app's users. What's more, apps are no longer allowed to link out to a store page, a la Kindle jumping over to Safari whenever users go to buy a new book. Which makes plenty of sense of course, since there's not much point in levying the 30 percent fee if app developers can simply link out to a website's store page where they are free of in-app purchase fees.

In terms of any implications on the iOS gaming community, they remain abstract at this point. While there are plenty of microtransaction-based gaming business models on offer, the iPhone and its sibling devices have yet to see a proper MMO-type experience. Given how well the game scales for lower-power PCs, I wouldn't be surprised to see a "World of Warcraft" iOS client eventually make its way into the App Store. That is of course if Activision Blizzard could stomach the thought of players potentially signing up in-app -- they'll have to have that option, remember -- and paying Apple a 30 percent cut.

That's going to be a possible deal-breaker I think for many developers with designs on bringing an MMO to the iOS space. 30 percent is a huge chunk to ask for, especially in a market where the chief competitor, "WoW," dominates by such a wide margin. This is the strongest argument yet that I've seen for app developers to wholly embrace pursuing jailbreak app development instead.

Tags apple, world of warcraft

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