Apple-Microsoft iOS SkyDrive fight extends to Office 365 too

Earlier this morning, rumors hit the Internet that a planned update for Microsoft's iOS SkyDrive app was being delayed due to a disagreement with Apple. The issue that the two companies are reportedly fighting over center on the 30 percent of revenues that Apple takes from all iOS app purchases. Microsoft wants Apple to change this 70/30 split when it comes to selling additional SkyDrive cloud space via the iOS app.

Now AllThingsD.com reports that, according to their own unnamed sources, Microsoft and Apple are also fighting over the same issue when it comes to selling Office 365 subscriptions on iOS devices. The online productivity service was expected to launch for that platform, as well as Android, sometime in 2013. So far, Microsoft has yet to officially confirm an Office 365 launch for iOS.

The article does not specify what kind of changes to the revenue model Microsoft is requesting from Apple, but whatever it is, it seems that Apple doesn't seem to be interested in changing its long standing 70/30 split on revenues. That was the reason Amazon.com changed its Kindle app for iOS a while back so that sales from iOS products like the iPhone and iPad come from Amazon's web store, rather than directly from the Kindle app.

AllThingsD.com did receive a comment from Apple, which said:

We’ve designed our rules to be fair and consistent for every developer — free apps and services are distributed for free, paid apps and services provide a revenue share to Apple. We’ve paid out over 6.5 billion dollars to our developer community who have created over 700,000 apps.

Microsoft has so far not commented on this aspect of their issue with Apple.

Source: AllThingsD.com | Image via AllThingsD.com

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The thing is...MS has already put a ton of development into Office for iOS. Apple's subscription policy has been a long standing rule that MS knew about probably before they even started development for iOS.

They knew what it was when they started working on the project. Surely they have already concluded that they can make a profit either way. They are just trying to make more with this posturing (and who can really blame them).

Meanwhile, Apple has its policy. It has had its policy for awhile. iOS and especially iPad are insanely popular in spite of this policy and in spite of no MS Office. Apple does not need MS Office on iOS to remain insanely popular. MS already has a lot of money invested in this, so really the ball is in Apple court.

screw them really. Apple is in decline anyway. Having lost first place to Samsung, and having lost first place to android, they are nothing but a zombie company riding on its huge cash reserves and ever declining momentum.

if only windows and android mobile devices have office, it will just be another milestone on apple's road to irrelevance.

C'mon MS, just change your policy and charge every itunes sale made through windows 30%.
Do it already, shut them ****ers up!

Who benefits more from a known AKA desired developer making apps for a device or OS? I think Apple benefits more. If you have an iWhatever and want skydrive or MSOffice, then Apple needs an app for that (I think, unless it is accessable somehow through the web). If the customer really insists on Skydrive or MSOffice, then are they more likely to go without the iWhatever, or without the app?

Ironically, this seems kind of similar to charging xbox360 users to have xbox gold to access Netflix.

It's not really like that at all - this would be like telling Netflix they want 30% off their £5.99 sub fee every time an Xbox Live user makes an account their console.

I'm still scratching on how this is a new development or why it hasn't received any attention until now - ie how it became the premiere app store with such limitations.

I actually talked about it a week or so ago, where I said that the Azure toolkit for iOS was causing apps to be rejected. I was attacked for not knowing what I was talking about, and tarnishing Apple's good reputation (OK, those were not the exact words, but close enough)

Probably because there are a lot of developers making good money off the App Store despite the 30%.

Apple provides a spot for an app to get some advertisements, they handle billing, and they connect the developers to a large user base. Further, Apple does the billing support and assumes the responsibility of anything that goes wrong in billing. If Apple's customer database gets compromised, the law suit targets are going to be on Apple not on the developers. Apple is assuming some risk and it makes sense that they are compensated.

For small time developers I think that something close to 30% is reasonable because they don't have to worry about setting up any kind of CC processor. Some users also don't want their billing information going out to every single app developer. Developers don't necessarily want to setup a webpage to advertise their app. Obviously these folks are enjoying the fruits of Apple's and their own labor.

For larger businesses like MS who already have a massive infrastructure that they have invested in and developed I can see how 30% seems like A LOT going to Apple. MS doesn't need Apple to handle billing for them. MS doesn't need Apple to advertise for them. MS just seems to want Apple's user base.

I guess I still just don't understand enough of how/why Amazon or a myriad of other 'services' and stores haven't stood up to Apple on that. 30% on the one time purchase, sure. 30% of services you aren't even providing? Ridiculous.

Then again, doesn't the MS Store (and XBox live additionally) impose the same goofy restrictions which is why Valve is concerned?

Dashel said,
I guess I still just don't understand enough of how/why Amazon or a myriad of other 'services' and stores haven't stood up to Apple on that. 30% on the one time purchase, sure. 30% of services you aren't even providing? Ridiculous.

Then again, doesn't the MS Store (and XBox live additionally) impose the same goofy restrictions which is why Valve is concerned?

Yes, Microsoft does. That is why my eyes are sore from all the rolling from this thread. It's Goliath vs Goliath here and being over zealous for eithe is just silly.

They don't stand up because when you do, you get hordes of Apple fanatics that call for your boycott and utter destruction. Remember when NBC decided to pull their shows off of iTunes? For months there were Apple fans running around telling everyone to stop watching them, vowing to never watch them again.

Nope, MS does not impose the same restrictions. Valve could put an app on the Win8 store, and set it to be free. Then use their own service for charging when you want to download a game from their store. The only time Microsoft charges you is if you want to charge a price for the app in the store. You can choose to use MS' service for in app purchases, but you are not required to. You could use Amazon's, Google's, PayPal's, or any other service if you wanted.

I've been in the Apple circle for awhile and don't recall there ever being an NBC boycott. Are you listening to 1 person and extrapolating to millions of users?

Shadrack said,
I've been in the Apple circle for awhile and don't recall there ever being an NBC boycott. Are you listening to 1 person and extrapolating to millions of users?

Here is one, while the article is not really about a boycott, there are plenty of comments saying they will:
http://www.ilounge.com/index.p...eaving-apples-itunes-store/

More:
http://forums.macrumors.com/showthread.php?t=348667

The worse was on Engadget, but because they have switched commenting systems so many times, they no longer have those comments. But looking over those comments, there are calls for boycotts, "I am going to stop watching NBC," calling NBC corporate greed (pot, meet kettle), and so on.

Not every Apple user was standing outside Apple HQ with pitchforks and torches, but there were a good number of them that we calling for boycotts and the end of NBC because they didn't want to sell on iTunes. Looking around the web for comments on the NBC/Apple argument, there are plenty of "NBC ruined my life, screw you I am going home" comments. Those are the fanatics I were referring to. Fanatics != fans. And yes, there were plenty of fanatics.

Ok then Microsoft should ask for a revenue share for each and every app / music / movie purchase on itunes for windows

Simple, you want to purchase more Skydrive space through iOS then it will cost you 50% more. Otherwise, do it through a Microsoft browser and pay regular price.

Apple's rules get in the way in the developer guidelines for in-app purchases block that.

>> If you would like to make a subscription offer outside of the app, the same (or better) subscription price must be offered inside the app for users who wish to subscribe from within the app. In addition, you may not provide links in your apps which allow the customer to purchase content or subscriptions outside of the app.

So Microsoft is free to day "purchase more space through the website" but they can't link to it in the application and they can't double-charge people using in-app purchases.

One possible work around would be to offer iOS users the ability to purchase 26-weeks of +10gb for say $50. That offer is available online and in-app. Additional options are available outside the application (say 1 year of +10gb for $30). Because not exactly the same thing is offered in-app and out-of-app it might be a viable work around.

Realistically: Apple sets the rules, they want their pound of flesh and that sort of trickery isn't going to work.

the evn show said,

Realistically: Apple sets the rules, they want their pound of flesh and that sort of trickery isn't going to work.

This just matter how far either Apple or Microsoft are willing to go over this.
Microsoft has the upper hand when it comes to the collaboration between the 2.
Apple needs Microsoft hell of allot more then Microsoft needs Apple (Apple's entire income runs on IP from Microsoft)
Their iCloud runs on NT Azure as well.
If I where MS I'd just raise the coming contract with 30%

I agree with the other (non-Apple fanboi) commenters with either just linking them to the web interface or increasing the price for in-app and keeping regular prices for web.

Oh well... another reason to use Windows Phone

Simple, you want to purchase more Skydrive space through iOS then it will cost you 50% more. Otherwise, do it through a Microsoft browser and pay regular price.

They are both as bad as each other, if you want to play in each others fenced garden then you have to pay the price of admission!

If Microsoft want to get to Apple's customers then they have to be prepared to pay for it.

Exactly!!!!! Without Windows itunws wouldnt have aby users bec hiw many oeople woukd buy a Mac to eun iTunes? Only an idiot. I would just use xbox or some other tablet. Apple is sick. icrosoft doesnt get a dime foe apps developed cor Windows. I guess Microsoft shouid get a cut of all the pc sales that run Windows and Office above the cost and money they get for the licenses. I mean after all without Windows what OS are they going to use? Linux?

TechieXP said,
Exactly!!!!! Without Windows itunws wouldnt have aby users bec hiw many oeople woukd buy a Mac to eun iTunes? Only an idiot. I would just use xbox or some other tablet. Apple is sick. icrosoft doesnt get a dime foe apps developed cor Windows. I guess Microsoft shouid get a cut of all the pc sales that run Windows and Office above the cost and money they get for the licenses. I mean after all without Windows what OS are they going to use? Linux?

Good lord, the typos! I thought I was having a stroke while reading that.

I think it is not as simple as saying that MSFT has to play by Apple rules when they want to get Office on iOS devices. MSFT will argue that their app is a vital part of the ecosystem and will bring more users and further revenue to Apple. While they may or may not have a point if Apple were to concede next thing you know the other major app developers will want a bigger share on the same grounds.

So Apple really can't give in and MSFT will want them to.

I agree with other commenters... just create a webpage that users can go to to sign up for the subscription.

Question: Are they allowed to put a link to such web store? Or do they have to tell users to go online and search for the web store?

the evn show said,
...

Hmmm... so basically if the subscription ONLY exists outside of the app, Apple won't approve the app. I guess I've been mistaken on that all this time. I thought you could have a subscription outside of the app and so long as you make no reference or link to it inside the app you are OK.

the evn show said,

What the flying fawk.

How did devs agree to this? lol

Another question... is the 30% on the initial payment made within the app? Or all future payments as well?

nohone said,
Microsoft: We would like an exception to your rules.
Apple: No.

Doesn't sound like negotiation to me.


It's most definitely not fighting either.

When it means that after much time and money has been spent developing one of the most widely used software packages, it may not ship for another platform because Apple wants money for a product that they have no part in, I think it is safe to assume that the two companies will not be going out for beers at the end of the day.

Especially since Apple runs some of their services on the very cloud platform that they are trying to get money from.

Apple plays a big role in the distribution of SkyDrive and other Microsoft online services? They may want to tell Microsoft that, I am sure MS will get a good laugh over it. I guess Apple takes credit for inventing everything from the music player to the square, so why not take credit for Microsoft's online services.

How is this different from any other app like LastPass or Sporify or any Business branded app running with software maintenance?

I hope Microsoft stand up for them self and don't cave in (Which they wont) or charge a premium for anyone using an iDevice to offset (It would be the only way for them to balance it AFAIK)

brent3000 said,
How is this different from any other app like LastPass or Sporify or any Business branded app running with software maintenance?

I hope Microsoft stand up for them self and don't cave in (Which they wont) or charge a premium for anyone using an iDevice to offset (It would be the only way for them to balance it AFAIK)

just charge IOS customers 130% of the original price and give apple the 30%. That's the price for buying into a platform run by a greedy company. (they are all greedy i know, but the greed needs to be moderated by consumer needs at times).

Just do what Kindle did and buy everything through the Skydrive homepage. You can select how much space you want through the app, then go to the Skydrive website to complete the purchase.

Not before you guys understand that this policy from Apple is retarded. So i'll guess it will never happens because the Apple loverbois'es will accept whatever Apple says.

Tom, say whatever you need to say to help boost your own self-esteem. You sound like you need a 'pick me up'.

Edited by Shadrack, Dec 12 2012, 12:15am :