Is Apple About to Lose its Gatekeeper Status?
Remember when Apple (Nasdaq: AAPL) announced back in February that it would start skimming from content publishers’ revenue this year?
Well, high volume distributors like Amazon (Nasdaq: AMZN), Barnes & Noble (NYSE: BKS) and Google (Nasdaq: GOOG) certainly do.
Especially because the original plan was for Apple to take a 30% cut from their e-book sales.
Apple ultimately caved, deciding instead to forgo the 30% cut, as long as publishers sold the content outside the application (i.e. in the browser).
The publishers also had to remove the convenient “in-app” link that took customers to the external book store.
So on Monday, apps from The Wall Street Journal, Barnes & Noble, Amazon and Kobo lost their in-app purchase buttons.
The Google Books app even disappeared from Apple’s App Store completely!
So now if you want to buy a new Kindle book on your iPad, you need to close the Kindle app, open your browser to the Kindle Store, purchase the book, then go back to the app to sync up.
Seriously?
Not to worry, though. An app store substitute is already in the game: HTML5.
And as you’ll see, some publishing companies are already making a run for it.
The Grass Truly is Greener With HTML5
Simply put, HTML5 is a coding language developers use to create rich, full-featured web pages. And it doesn’t need the help of plug-ins like Adobe (Nasdaq: ADBE) Flash.
Recall in March, I listed HTML5 as one of the beneficiaries of the iPad2’s rampant success. But now, HTML5’s success is about to blow up in Apple’s face as it’s being more widely adopted by web developers.
You see, HTML5 isn’t just for websites. Mobile developers for the iPhone and iPad can use HTML5 to create applications, too. So instead of storing apps on a mobile device, developers can run them on the web.
Tech publisher, VentureBeat, says, the “HTML5 movement has so much momentum that it could defeat the native app — an application that’s designed to run on a single platform — in as little as two years.”
Granted, the popularity and simplicity of the App Store should allow Apple to maintain its gatekeeper status for a while… but not forever.
Stop Playing God
The advantage with HTML5 is that you don’t need permission to upload your own app online, so it provides an easy workaround for Apple’s notoriously stingy app approval process.
Take the Financial Times, for instance. To dodge Apple’s stringent policy, it released an HTML5 app last month. And as the company says, “There’s not a single thing we couldn’t do in HTML5 that we could do in our native app.” And Kobo’s already gearing up to follow the Financial Times’ lead.
Apple needs to cool it with the constant restrictions, and give developers some breathing room (i.e. – stop trying to play God).
I believe other content providers will go the HTML5 route for the following reasons…
Reason #1: Users don’t need to buy apps through the App Store. Since applications run online, content providers can keep Apple from earning a cut.
Reason #2: HTML5 programs can also be used offline. They “can still function in areas with no connection. Gamers, for instance, can continue playing uninterrupted even if their device loses its signal,” according to CNN.
Reason #3: HTML5 apps can run on any operating system. So instead of customizing apps for each platform, developers only need to create one universal application.
Sure enough, starting in August, Google’s supporting all of its web apps, like Gmail and Docs, with HTML5.
In June, Microsoft (Nasdaq: MSFT) announced that it’s ditching its traditional platforms for HTML5 in Windows 8. And Pandora (NYSE: P) is making the switch this month, too.
Like ZDNet says, “These players will say screw iOS. Here’s the HTML5 version.” And the biggest loser could prove to be Apple’s bottom line.
Good investing,
Justin Fritz
Related Topics: Stocks, Tech and Innovation
