iFlowReader, an ebook app, has been forced to close, saying that Apple's fee structure for ebook sellers killed the app by causing the company to operate at a loss.
This is the first major app casualty of the new fee model that Apple introduced earlier this year.
In a statement on its website, the company writes, "Apple has made it completely impossible for anyone but Apple to make a profit selling contemporary ebooks on any iOS device."
Just buy a real book
"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," the statement continues.
"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."
Apple sells books through its own iBooks app, too – but it does so through the so-called 'agency model', which sees major publishers become the book sellers direct while Apple takes a healthy commission (again, 30 per cent) on all sales.
But independent sellers also have to pay the publishers 30 per cent commission on each book sold, as well as paying Apple. So the bookseller is now taking only 40 per cent of the sale price, which, as iFlowReader puts it, "is all of our gross margin and then some."
Flourish and Blotts
All this is compounded by the fact that all booksellers must sell each book at the exact price set by the publisher; so if Harry Potter and the Philosopher's Stoneis sold at £8.99 by the publisher, that's the price every other bookseller must adhere to (except, of course, you can't buy a Harry Potter ebook at present).
As a result, the makers of iFlowReader are out over a million dollars and eighteen months' hard work
"We had extensive plans to make [iFlowReader] even better. We looked to the future of ebooks for inspiration while Apple and others were looking at the printed books of the past."
In a passionate conclusion, the company adds, "We put our faith in Apple and they screwed us… Apple can change the rules at any time and they did… We never really had a chance."
iFlowReader users can save their existing eBooks by following the instructions on the website before 31 May.
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