Update, 04/18/13 – It’s being reported by tech news outlets that Apple has disabled push notifications for the AppGratis users who have previously downloaded and installed the app. Does this mean that AppGratis is going to owe a LOT of refunds to advertisers? I can’t think of any client of ours who would buy in app advertising and then be satisfied with an email campaign as a substitute… and what happens to the 13.5 million dollars in investment that’s recently been announced by the company? One would think that if they haven’t collected, they may not be able to until things are back on track.
Original Story, 04/17/13
AppGratis was pulled from the AppStore on April 5, with Apple citing breach of rules 2.25 and 5.6 in the app review guidelines as the reason for the move.
First, you may not know who AppGratis is or what they do — it’s an app that offers ‘deal of the day’ promotional tie-ins for app developers who pay them for their promotional services. We spoke with them during AppsWorld at the Moscone Center earlier this year and were not completely clear on how their program operated, other than the part where one would pay them a considerable amount of money and they would increase visibility for the apps being promoted. Which is a similar claim to many other promo companies in the ecosphere.
By downloading the AppGratis app, users receive a push notification daily, with a promo – deeply discounted or free – for other apps, who buy the advertising slots that wrap the ‘editorial’ choice of the day. AppsGratis calls itself an app discovery tool, and certainly users need help discovering apps, given the sheer number of apps being published.
The rules in question –
Clause 2.25 of Apple’s App Review Guidelines – “Apps that display Apps other than your own for purchase or promotion in a manner similar to or confusing with the App Store will be rejected.”
Clause 5.6 – “Apps cannot use Push Notifications to send advertising, promotions, or direct marketing of any kind.”
AppGratis CEO, Simon Dawlat, has updated the company blog with his side of the story, and claims to have had approval from Apple’s reviewers to market AppGratis exactly as it was, and that the company had approved the iPad version of the app less than a week prior to the rejection.
Claims that AppGratis was selling rankings have been refuted by Dawlat, but yesterday Business Insider posted a copy of a CPI estimation sheet by country that indicates a top five ranking in the US AppStore would cost a developer $300,000 USD.
Apple’s position that apps cannot mimic the AppStore and that rankings in the AppStore are merit based has legs; however… big dev studios (Disney, Rovio, etc) have a marketing budget that allows them to create a buzz during pre-release and to leverage their existing user base via in-app advertising in their apps such as Angry Birds or Where’s My Perry?, driving downloads and boosting rankings out of the gate.
Small dev studios and individual developers without this sort of budget or base to draw from simply cannot get the same amount of PR and visibility, but Apple does not punish large companies for advertising their new apps in a big budget way.
Apple has also taken a hard stance against incentivized downloads so perhaps this is just the tip of the iceberg. The problem that Apple faces is there are simply too many apps being published for true organic growth and discovery to work in all but a tiny percentage of cases. At least 50% of published apps do not make their developers enough revenue to cover the cost of development, and I would suspect that it’s a much higher figure if enterprise and B2B apps are culled from the count.
AppGratis competitors remain in the AppStore, at least for the time being, and it will be interesting to see if Apple decides to punish them similarly, or if AppGratis will be the sole casualty in this round of the war. Creating a company that relies completely on a business that someone else owns is always a high risk situation, and one that often ends in tears, just like the Twitter feed outrage of several months ago.