That would be a horrible business decision, in my opinion. "Under the table" deal is just another way of saying "violating the agreement I signed". Two wrongs don't make a right, etc, etc. But more importantly, operating in the background would just enable Apple. Cutting Apple out of the revenue won't really hurt them, but it will increase dependence on their platform, which gives them more leverage.

Under the table deals would be extremely short sighted and dishonest.

Yeah, I think you are right.. I was commenting on the third party part more than the under the table part.

I was thinking more along the lines of Amazon creating an open or liscensed API for it's ebooks, so that someone can make an app for me to log into and read books that I own. Users could still read their kindle books on their iphones, and amazon could keep it's position as the best book store for iOS users, expand to other devices, etc..

I don't think it is worth it for someone like Amazon or Pandora to stay off of Apple's platform just to give them less leverage, but I agree that they would have to be upfront about it.