Companies distributing applications on the Apple App store should take note: multiple companies today have stopped selling content from their applications sold on the Apple App store, suggesting that Apple is taking steps to enforce its new rules to collect its royalty on direct sales from applications being sold on the App Store.
The Financial Times reported that Apple began notifying companies last week that it intends to enforce its new policy and to collect its standard royalty rate on direct sales made even through a mere link in the application to the app owner’s website.
The Wall Street Journal reported its decision to no longer sell content directly from its application to customers and also reported that Kobo, Inc., a Canadian e-book retailer, made a similar announcement, and that Google Books was no longer in the App Store as of Sunday night. Today’s iPhone likewise reported that Amazon discontinued sales of e-books from its Kindle e-reader as of today, and The Financial Times added Spotify and Rhapsody to the list of companies who had removed features to sell products from their applications.
The reports suggest that many of these companies had previously included a link within their applications to a separate store on their websites and had not been paying the Apple royalty on direct sales that had been redirected to their websites from their applications.
Based on the actions just taken by these large companies, it seems clear that all companies who are distributing applications from the App store need to take note of these signals coming out of Apple and from large companies doing business with Apple and anticipate future enforcement activity against their companies if they are selling products through their applications on the App store without paying Apple its royalty on the sales. Apparently just having a link within the application to a store outside of the application may be enough to trigger the Apple royalty.
Category: Smartphone Applications
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Silicon Valley entrepreneurs have a tendency to want to offer equity to anyone who they hire when they are first getting off the ground, and some developers prefer to receive equity in the business over an IOU that they may or may not be able to collect on.
However, when an entrepreneur calls me saying that he or she wants to offer equity to a developer he or she barely knows but wants to bring on board for the project, I always suggest that he or she consider another option: a collaboration relationship.
In my recent posting to the Silicon Valley IP Licensing Law Blog, I explained why collaboration agreements should be contemplated by many software start-ups hiring their first developer.
Disputes over development projects are extremely common in even the best of economies, but are particularly common in today’s world, where most companies are on a tight budget and developers are always on the lookout for better paying opportunities.
In fact, development disputes are becoming so widespread that I receive calls now almost daily about yet another web or software develpment dispute. Surprisingly, in almost every case, the purchaser of the development work has overlooked a critical aspect of the project: the purchaser has neglected to request an assignment of the copyright for the work developed.
My recent post on the Silicon Valley IP Licensing Law Blog explored why you should require a copyright assignment agreement before you start a development project. Requiring a copyright assignment when you start the development project ensures that you will obtain the rights to the work you are paying for when the project is completed. Otherwise, the chances are high that the developer will terminate your license to use the work as soon as a dispute arises, and you will lose not only the cash you invested in the project but also your rights to use the work.
Category: Development Tips
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I receive a call nearly every day from an entrepreneur who has a great idea for a new software start-up company, and is concerned about how to protect that idea before he or she is able to launch it.
Unfortunately, for such entrepreneurs, there is no application that can be filed that can protect mere ideas. However, entrepreneurs should still take steps from the moment they first conceive the concept for their business to protect the intellectual property they develop. On the firm’s sister blog, The Silicon Valley IP Licensing Law Blog, I discussed what software entrepreneurs can do to protect their start-up ideas before they actually get them off the ground.
Category: Software Start-up Tips
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