InfoTech: big players eschew Apple Apps

For many retailers, an App is nothing more than a way of getting a user to put the company's advert and a quick link onto their phone or tablet. In the worst cases, such as one of the BBC iPlayer apps available on Android, adds absolutely nothing that a bookmark in a browser.

But some companies developed their Apps to deliver functionality including a dedicated payment service.

If an App developer charges for their App, then Apple takes a percentage of the amount the customer pays (in addition to a registration fee that even developers of free apps must pay). That percentage is 30%.

Apple says that "in-app" payments must go through the Apple store and that the seller must therefore pay 30% on all sales.

Retailers are furious. They do not have, in many cases, a 30% margin to play with and, if they did, they certainly don't want to give it to Apple for what is seen as little or nothing more than being a payment processor.

But there's a problem: if the stores want to install e.g. a proprietary e-reader on Apple devices, then the only way to expose it to the millions of Apple users is via the Apple AppStore and then, when users buy ebooks, Apple grabs its 30%.

All of this explains why Apple could, if it wished, pay cash for almost the entire US government budget deficit for this year and potentially return its country's credit rating to the coveted AAA, lost because the country ran out of money while Apple raked it in.

Companies are not taking Apple's latest demand lying down. In what is now being seen as a backlash against Apple's abuse of its dominant position, companies are now looking at alternatives.

Apple is keeping quiet about the threat it faces from the emerging HTML5 standard which, among other things, will play videos within the browser - and that includes Flash which Apple steadfastly refuses to support.

HTML5 is cross-platform, device independent and will work on both phones and tablets. Companies such as WhatsApp who do not support tablets and last week told a user that they have no plans to do so are unlikely to be affected: their App is not browser related. But shopping apps, airline apps and so on are at their heart browsers.

VUDU says on its website that users should simply visit the site with their browser because it has been designed with the iPad in mind. "There is no need to install an App."

Recognising that Tablets are the battleground for e-Readers, Amazon.Com has launched Kindle Cloud Reader. It is "a web app that lets you read your Kindle books, instantly." Just fire up your browser: which one? Safari or its close relative Chrome. For PC, Mac or iPad." Firefox and Opera, to say nothing of MS users are not welcome.

Quite why Chrome isn't the standard browser on Android is a mystery: Google own both that prevents it being ported to Android devices? It's not only us that asks - see http://techcrunch.com/2011/05/17/google-chrome-android/ for the blunt, almost "stop asking us that question" responses to questions at a recent Google Q&A session. Or is it that much of Chrome originates in Safari (things that don't work in one generally don't work in the other) and Apple wouldn't like it if e.g. Samsung Galaxy Tab 10.1 even ran essentially the same browser as an iPad 2?

So, is Apple's business model under threat?

Not much, at least not yet. While an increase in non-approved Apps will arise as HTML5 takes greater hold, what will disappear will be the crApps that shouldn't clutter up anyone's interface with ads masquerading as quick links. Just bookmark the page you want. Smaller retailers and sellers of event tickets will fall back onto web applications. Apple won't miss them much, at least not individually. And the companies will see their cost of sales fall by around 25% of the "gateway" fee.

But there's a mug born every minute and most of them want to be cool. It took them three years to start to put the Facebook and Twitter logos onto everything in sight. It's going to take longer for them to tumble to the fact that Ad and PR agencies will keep arguing for Apps when the real trendsetters have long gone, leaving the staid and boring to buy via their apps. And staid and boring are the mainstay of most businesses where a combination of inertia and loyalty keeps the tills tinging.