Regulators scrutinizing Apple App Store subscription service

The Justice Department and the Federal Trade Commission have started looking at the terms behind Apple's (NASDAQ:AAPL) new subscription service for all content-based apps in its App Store. However, the inquiry is just preliminary and no formal investigation has been launched, according to the Wall Street Journal, which cited people familiar with the matter.

Earlier this week Apple launched the subscription service which enables publishers to establish recurring payment plans for apps. However, Apple is mandating that if a publisher is making a subscription offer outside of the app, the same or better offer be made inside the app. The new service applies to magazines, newspapers, video, music, etc.

Regulators apparently are looking at whether Apple is breaching U.S. antitrust laws. Specifically, they are examining Apple's decision to funnel media companies' customers into the payment system used for its iTunes store--and taking a 30 percent cut of the subscription revenues.

Apple doesn't prevent media companies from selling digital subscriptions on their own, but the company does have restrictions that make it a less appealing option for consumers. Content companies have already expressed serious reservations over the terms of the service, which, in addition to giving Apple 30 percent of subscription revenue, also gives the company ownership of consumer data like names and email addresses. 

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