Wednesday, December 12, 2012

Microsoft, Apple tussle over App Store's 30 percent cut

Apple collects a 30 percent fee for any paid apps in the App Store or in-app purchases made in iOS app. Yes, that even applies to big rivals and partners like Microsoft, and therein lies the problem, as reported Tuesday.

Microsoft recently added the ability for SkyDrive users to purchase more storage space on the service, in-app. Microsoft's current SkyDrive policy is to offer free accounts with the option to upgrade to paid accounts later. However, Microsoft has refused to pay Apple its 30 percent, and with that, Apple has blocked further updates to the app.

That includes a new version that includes a key bug fix that would patch a crashing bug, but Microsoft cannot get it through the App Store approval process. What's strange is that Microsoft even offered to update the app in such a way that all subscription options were removed, but even that update was rejected. The last update to SkyDrive for iOS was released in June.

One reason that Microsoft doesn't want to pay Apple its 30 percent is that the subscription would be perpetual, even if an end user were to switch to a Windows Phone or Android device. The reason for that is that the billing would recur through their iTunes account.

Microsoft is negotiation with Apple, but the two companies have not come to an agreement yet.

The dust-up has spilled over from Microsoft and Apple to third-parties that might want to leverage SkyDrive in their own apps, too. Files Pro, for example, was rejected because of the presence of the "Sign Up" button in the Live login authorization page. That is a no-no, according to Apple.

Apps which used the Dropbox SDK were rejected a few months ago for the same reason, but Dropbox fixed the issue by removing the "Sign Up" button from their login page for iOS clients.

While Files Pro worked around the issue, Microsoft hasn't addressed the problem directly, just yet. Microsoft hasn't confirmed the entire report, but it has acknowledged a delay in the latest SkyDrive release, saying:
Similar to the experiences of some other companies, we are experiencing a delay in approval of our updated SkyDrive for iOS. We are in contact with Apple regarding the matter and hope to come to a resolution. We will provide additional information as it becomes available.
Let's hope the two competing giants can come to terms, soon.

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