Apple subs service faces anti-trust probe

Apple's recently announced in-app subscription model is coming under scrutiny from lawmakers in the US and further afield.

The automated payment service, which skims 30 per cent of income for automated payments transacted through the iTunes App store has caught the attention of the US Justice Department and Federal Trade Commission as well as the European Commission, according to the Wall Street Journal.

Citing those regular contributors, the increasingly prevalent and mysterious 'people familiar with the matter', the Journal suggests that US investigations into Apple's latest cash cow are "at a preliminary stage, and might not develop into either a formal investigation or any action against the company," whilst an EC spokeswoman said that the commission was, "carefully monitoring the situation."

The new payment model allows publishers to sell subscriptions through their own web sites without giving the Cupertino company a cut, but insists they cannot undercut the iTunes price, and forbids them from linking out from within the App to their own sales sites.

The gadget maker, which is now the richest tech company on the planet, as well as by far the largest seller of online media, has been accused of making it impossible for some media delivery companies, especially those providing music-streaming services, to make a profit in a market with notoriously thin margins.

Jon Irwin, president of popular US music outfit Rhapsody, complained that the 30 per cent cut taken by Apple was unreasonable, saying: "The costs don't leave any room for a sensible business model."

For any company other than Apple that is.

Apple has come under fire for antitrust businesses practices in the past, most notably when it banned the use of Adobe tools by its third-party developers, and agreed with other tech tech firms not to poach staff. In both cases the Mac maker backed down after the Feds started snooping around.

Apple is widely predicted to be in the process of setting up its own cloud-based media-streaming service which might explain why it is trying to squeeze out the competition.

Now we're not lawyers, but it seems to us like its Apple's ball, Apple's bat and Apple's playing field and it will insist that the other kids either play nicely by its rules or go play somewhere else. Game over.

We're sure that real lawyers will have a thing or two to say about that particular theory whilst lining their pockets.