Rhapsody Intimates Possible Lawsuit Over Apple’s New In-App Purchase Policies

Rhapsody Intimates Possible Lawsuit Over Apple’s New In-App Purchase Policies

Earlier today, when mulling over Amazon’s options in making their Kindle app comply with Apple’s new in-app purchase rules, I suggested that the simplest way for Amazon to preserve its existing business model without fleeing the App Store might be to pursue a good old fashioned lawsuit.

Amazon hasn’t filed one yet, but music subscription service Rhapsody is already threatening one, having already issued a statement saying “We will be colaborating with our market peers in determining an appropriate legal and business response to this latest development.”

The statement’s awesomely catty. These guys are pissed. Check out this rebuttal to Steve Jobs’ “Our philosophy is simple — if Apple brings you a customer, we deserve a cut” remark:

Our philosophy is simple too – an Apple-imposed arrangement that requires us to pay 30 percent of our revenue to Apple, in addition to content fees that we pay to the music labels, publishers and artists, is economically untenable. The bottom line is we would not be able to offer our service through the iTunes store if subjected to Apple’s 30 percent monthly fee vs. a typical 2.5 percent credit card fee.

My guess is a lot of companies are going to feel this way, and Apple might be looking at the first rumblings of wide-scale revolt as numerous services from Kindle to Netflix to Rhapsody consider their options.

Meanwhile, The Wall Street Journal hints that Apple might have just made the first step towards an anti-trust lawsuit… although they seem skeptical that it would be an easy win for the likes of Rhapsody, Amazon or any other number of companies.

One thing’s for sure: Apple’s really ticked off a lot of companies with deep pockets with this move… and it’s seeming ever more likely that they’ll have a fight on their hands asserting their rights to a universal 30% in-app cut.

Update: The original headline for this piece was “Rhapsody Threatens Lawsuit Over Apple’s New In-App Purchase Policies.” Rhapsody contacted us and asked us to correct, as they have only said they are looking at their legal options, and have not yet threatened anything.

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About the author

John BrownleeJohn Brownlee is a Contributing Editor. He has also written for Wired, Playboy, Boing Boing, Popular Mechanics, VentureBeat, and Gizmodo. He lives in Boston with his wife and two parakeets. You can follow him here on Twitter.

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