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Apple’s 30% vig claims its first victim

Do me a favor. Go visit the iFlowReader website. You"l find the following message on the homepage:

Thank you for being one of our valued customers. We are writing to you today to make a very sad announcement.  BeamItDown Software and the iFlow Reader will cease operations as of May 31, 2011.  We absolutely do not want to do this, but Apple has made it completely impossible for anyone but Apple to make a profit selling contemporary ebooks on any iOS device. We cannot survive selling books at a loss and so we are forced to go out of business. We bet everything on Apple and iOS and then Apple killed us by changing the rules in the middle of the game. This is a very sad day for innovation on iOS in this important application category. We are a small company that thought we could build a better product. We think that we did but we are powerless against Apple’s absolute control of the iOS platform.

This is only going to be the first.

I told you yesterday that Apple opened up a loophole for "read only" apps. Well, I’ve since been told that Apple didn’t tell everyone about the new rule. In fact, I’m not sure all the relevant people inside Apple know about it.

BeamItDown Software is clearly one of the developers who either weren’t told about the loophole or they weren’t allowed to use it. Neither surprises me.

The reading app selection could get mighty thin come June; that’s when the smaller ebookstores will all have to shut their doors. Even if they can survive under the new rule, the smaller ebookstores might not want to. They’ve already had to cope with Apple’s capriciousness once, and I’m sure a fair number can’t afford  to run the risk of Apple pulling this crap a second time.


via Mike Cane

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curiosity killed the.. May 10, 2011 um 10:02 pm

not to diminish their closing the doors on a product but why in this day and age would a company not work both ios and the android angle i mean especially for an ebook app can it be that hard to really just say ya know what apple are just greedy bastards lets at least try and salvage the business in android and see where things go.
i think the fact that they went"all in" on apple is as much their fault as apple changing the rules w/o any advance notice
for any company to survive there always should be a backup plan or at the very least a side step.

Tyler May 10, 2011 um 11:09 pm

I would not blame them as a company. A year or more ago, Android was not as big plus this is a small company. Their one million dollar start up capital is a lot of money for five guys but it is not a lot of money in the business world of today. This could have been the start of something big for them if it caught on which is what they probably were hoping for. They only submitted their app in November which is six months ago. Let’s blame Apple for ruining companies such as theirs.

Rich Adin May 11, 2011 um 4:50 am

OK, so who is still standing in line to buy an Apple product because they are so great? At least Jobs, like Bezos, is consistent — that is, consistently greedy and out for themselves alone.

Is there still anyone who believes that if Amazon or Apple corners the ebook market (or even share it between them by making B&N, the only currently viable major competitor in the U.S., truly marginal) that it will be the best thing for consumers to surface in the 21st century?

Quite frankly, the only ones truly to blame for the horrid state of ebooks today are the consumers who believe that Jobs and Bezos walk on water.

Mike Cane May 11, 2011 um 5:57 am

I’ve stated over and over that I hate one company having majority power in eBooks. Nature hates monopolies. Monopolies tend to fail. If we had a gov’t that wasn’t an outright whore, this would have been resolved by now.

Tyler May 11, 2011 um 10:51 pm

I have toyed with getting the iPad but with no USB and no easy external storage easily available, I won’t consider it. No one even seems to care the huge price Apple wants for what amounts to just a little bit of memory.

Andrys May 11, 2011 um 8:31 am

I agree with Curiosity Killed the…

iBooks can be read only on Apple devices. That gives small companies no clue on how closed Apple is?

If the company can build a rep, what happened to the idea that people can just use a browser to get to them? Does everyone just lie down when Apple says No?

Part of the fault is on people who make their companies dependent on one ultra-closed company.

fjtorres May 11, 2011 um 10:17 am

Unlike Amazon and Borders, small startups don’t have the name recognition to be able to do an ebook store that uses an app solely for reading and relies on customers going to their website to buy.
And, at this point, they likely didn’t have the resources to re-code the app for Android, WP7, Blackberry or whatever.
And, since Apple frowns on cross-platform development they are left with an app that only runs on iOS but can’t be deployed via iTunes.
Nice one-two punch.

I wonder if some of those State AGs that were so riled up over Apple spying on their customers might be interested in looking into thhis particular scam.

William Walsh May 12, 2011 um 4:32 pm

Not much sympathy from me. Going all in on the iXXX product line wasn’t a smart move, and the evidence of Apple’s constantly moving the bar and changing the rules goes back long before this company started.

Why any developer would go exclusive on iOS devices is beyond me.

Apple to Ship iBooks with iOS8, Invite More Scrutiny from the DOJ – The Digital Reader June 4, 2014 um 6:38 pm

[…] That rule was a practical impossibility for the major ebook retailers (none of them could afford to pay Apple 30% vig).  But more importantly, that decision (which emails show was made by Steve Jobs himself) was deliberately intended to harm Amazon. It is also known to have directly killed at least one ebook retailer. […]

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