Apple has relaxed a policy that took a 30% cut of revenue from movies rented or purchased through partner apps on Apple TV and iOS, reports Bloomberg. Amazon now sells movies via its app on Apple TV.
Amazon is first major partner
Platform owners like Apple and Google usually take a cut of most purchases made through their platforms. Specifically, Apple takes a 30% cut of revenue (15% of subscriptions after a year) generated from apps and in-app purchases, including movies sold through apps like Amazon Video.
As a result, Amazon Video, Google Play Movies, Vudu and others have typically refrained from selling movies and TV shows directly on Apple TV, instead referring viewers to their website to make the transaction.
Apple has made a change to its policy to let partners charge users via their own in-app payment systems and avoid sharing 30% of revenue. The first major partner to take advantage of the change is Amazon who is now, as of this week, selling and renting movies via its Amazon Prime Video app on Apple TV in the US.
- "Apple has an established program for premium subscription video entertainment providers to offer a variety of customer benefits," Apple said in a statement to Bloomberg. "Customers have the option to buy or rent movies and TV shows using the payment method tied to their existing video subscription."
Spotify has been one of the most vocal critics of the policy, arguing that its gives Apple's own services (such as Apple Music) an unfair advantage.
Part of a larger plan
Apple said that its new program includes "integration with the Apple TV app, AirPlay 2 support, tvOS apps, universal search, Siri support and, where applicable, single or zero sign-on."
In other words, it would appear that partners must sign up for deeper integration in order to be able to take advantage of the change. For example, if Netflix wanted to avoid sharing 30% or 15% of revenue from new users who sign up directly on Apple TV, it would most likely have to reinstate support for AirPlay and let its content library be available from within the Apple TV app.
This has implications for tvOS (Apple TV) as a platform and it could lead to increased competition. Apple said that besides Amazon, Canal+ and Altice One were already taking advantage of the new policy.
- Source: Bloomberg
