Microsoft Could Pull SkyDrive App For iOS As It Fights With Apple Over 30% Cut


SkyDrive's official iOS app could disappear if Apple won't negotiate.
SkyDrive's official iOS app could disappear if Apple won't negotiate.

The future of Microsoft’s SkyDrive service on iOS looks bleak today as the company appears to have entered into a fight with Apple over its 30% cut of App Store revenues. Microsoft recently gave iOS users the ability to upgrade their SkyDrive subscriptions from their iPhones and iPads, but until the company agrees to give Apple a 30% cut of the in-app purchases, it won’t get any future updates approved.

A critical bug fix that prevents the app from crashing has now had to be placed on hold. Should Apple’s rules be a little more flexible in certain cases?

When you buy an app from the App Store, or you purchase an in-app upgrade on your iOS device, Apple takes 30% of that fee and then passes the rest of the money onto the developer. That’s been the case since the App Store opened its doors back in 2008, and it applies to every iOS developer — whether they’re an independent game creator working alone, or a large corporation with a big catalog of apps.

So why should Microsoft be any different? Can’t it just pay the 30% cut like everyone else? Well, according to The Next Web, Microsoft has argued that when it comes to SkyDrive subscriptions, the 30% cut should not apply because the service isn’t exclusive to iOS.

In other words, you might upgrade your SkyDrive account on your iPhone to get a larger storage allowance, but you could upgrade to an Android or Windows Phone handset the following day — or never use SkyDrive on an iOS device again — and Apple still gets 30% of Microsoft’s revenue.

Microsoft doesn’t like that, and so it’s trying to work out a compromise with Apple. But as we know, Apple doesn’t like compromises; it’s usually Apple’s way or no way at all. Microsoft has even offered to remove the ability to upgrade subscriptions within the app, but Apple isn’t happy with that, either. And this is where the whole thing gets confusing.

You see, according to The Next Web, “if a service has a subscription option, it seems, and it is not listed in the iOS store, the application cannot, and will not be allowed. That is, unless you are small enough that Apple doesn’t bothers to check. I assume that smaller companies could slip under the radar.”

But I know of a number of subscription services that do not allow customers to upgrade their subscription within the iOS app, and they’re not “smaller companies.” There’s Spotify, for instance, and Netflix.

So it would seem Apple may have taken issue with Microsoft’s app for other reasons. But Microsoft’s not alone in this. Third-party developers who have built iOS apps that access SkyDrive are also feeling the Cupertino company’s wrath. One posted to Microsoft’s Live Connect forum:

Our iOS app “Files Pro” [Link] includes support for SkyDrive using the official Live SDK.

A few days ago our last update was rejected by the Apple review team because of the presence of the “Sign Up” button in the Live login authorisation page. According to Apple the presence of this button violates their guideline that:

“Apps that link to external mechanisms for purchases or subscriptions to be used in the app, such as a “buy” button that goes to a web site to purchase a digital book, will be rejected”

So even if Microsoft backs down here and just decides to remove its SkyDrive app from the App Store entirely, third-party developers will continue to face the same problem. It seems Apple won’t be happy until it gets its 30% cut.

That’s Apple’s call, of course, and it’s been the same way for over four years. No developer or company is exempt to this rule, and so you could argue that it shouldn’t change now for Microsoft.

However, I can’t help but think Apple needs to be a little more flexible with these rules in certain cases. Microsoft makes a good point: SkyDrive users can take their subscription anywhere, so why should Apple get 30% of their subscription fee.

Some companies may bite the bullet and accept it — most have up until now. But at some point, a major developer’s going to have to pull a service from iOS because Apple won’t negotiate. It may be SkyDrive, it may not. But either way, it’ll be the user that suffers as a result. Again.

Source: The Next Web

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  • techwarrior

    This is probably why subscription services for periodicals are floundering. We have a variety of devices with which we consume cloud services. If Apple does not make changes, folks will find it too restrictive to use iDevices. It is inevitable the competition will catch up with Apple, so this could become a competitive disadvantage.

    Clearly, iTunes is a game-changing marketing tool. Particularly for small devs who would have to build a complicated and costly marketing campaign without Apple’s store. But, for others with existing Marketing campaigns it is a bit of a quandary.

    If Apple relents on subscriptions for services shared with other devices, what stops a game dev from making a cross platform game that works on multiple devices and charges a small annual fee to use the service…

    The problem is really evident for one who consumes most of the benefit of the services on a PC, for which the app is not available in iTunes. To pay Apple 30% for the subscription is illogical. Perhaps the solution could be to charge a minimal fee to activate existing subscriptions for the service for iDevices.

    In the end, Apps is not the core business of Apple. It supplements their device sales, providing added benefit to choosing the iDevice over competitors products. Apple does not own the cloud, so they should tread carefully and not get too greedy.

  • technochick

    Netflix, Hulu etc aren’t iOS exclusive but if they take my money via the app, they pay Apple the 30%.

    Microsoft doesn’t want to play by the rules and as a potential developer I am happy to see Apple making them

  • technochick


    If Apple relents on subscriptions for services shared with other devices, what stops a game dev from making a cross platform game that works on multiple devices and charges a small annual fee to use the service…

    Nothing. Thy can already do it. That isn’t the issue. The issue is how the person got to the service. If they came to the iOS app first, paid via the app and thus iTunes, Apple gets the cut. if they paid off their computer and merely log in, the app didn’t bring them in as a customer nor are they paying via Apple systems, so no cut. The whole link rule is that Apple feels it is unfair for someone to gain a cx via the app but then sent them away from Apples systems to pay to avoid the cut. And I for one agree that that is a jerk move on the developers part.

  • philipreyreyes

    Isn’t the difference between SkyDrive and apps like Spotify and Netflix that they aren’t direct competitors to services provided by Apple i.e. iCloud. That being said I’d love for Apple to try out a music and video subscription service.

  • Spydefan

    Give Microsuck an inch and they’ll take a mile (Like they stole Windows in 1984)