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Wall Street Journal: Regulators Looking Into Apple's Subscription Service

An Apple logo as seen at one of their retail stores in Virginia. i i

hide captionAn Apple logo as seen at one of their retail stores in Virginia.

Karen Bleier/AFP/Getty Images
An Apple logo as seen at one of their retail stores in Virginia.

An Apple logo as seen at one of their retail stores in Virginia.

Karen Bleier/AFP/Getty Images

The Wall Street Journal reports today that federal regulators are looking at Apple's new subscription service. The Journal reports that the Justice Department and Federal Trade Commission's inquiry is at a preliminary stage:

The Justice Department and the FTC are both interested in examining whether Apple is running afoul of U.S. antitrust laws by funneling media companies' customers into the payment system for its iTunes store—and taking a 30% cut, the people familiar with the situation said. The agencies both enforce federal antitrust laws and would have to decide which one of them would take the lead in the matter.

Representatives of the Justice Department, the FTC and Apple all declined to comment.

Apple's rules don't stop media companies from selling digital subscriptions on their own. But the company imposed restrictions that could make that option less attractive to customers, and steer more sales through its own system.

As we reported on Wednesday, publishers weren't thrilled with Apple's new service, which demands that any company that charges a subscription for content that appears on their iPhone or iPad apps has to make a subscription available on the App store for the same or a lower price. Apple takes a 30 percent cut from that.

Reuters confirms the story citing unnamed sources. Reuters reports that the government is in the "process of contacting publishers of subscription plans and Apple."

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