Subscriber Information and Revenue Sharing Seen as Hurdles to iPad Newspaper and Magazine Deals

[QuixoticFable]

It must be hard for Steve to sit in the same room with some of these dumb asses and not hit them with chairs.

Are they stupid? They have an opportunity, through application development, to develop WAY more sensitive tracking information.

These guys have no clue. I hope Apple puts them all out of business.

I think you may have already been hit with a chair. The complaint is not the lack of information tracking. The complaint is Apple's refusal to share most of that information tracking. The situation is essentially this: The newspaper companies ask Apple what the demographics will be/are for readership for their paper on the iPad, and Apple responds, "Oh, we can't tell you that, but you sold X amount!" That would be like Best Buy telling Apple how many Macs it sold but telling them jack about who bought it.

This kind of information is the FOUNDATION for product development and customer-focus. Without this kind of information no company would stay in business for long, as they would have no way to track customer preferences and trends. The arrangement, as it stands now is Apple asking the publishing industry to bend over and take it with a smile.

 

[cmaier]

I think you may have already been hit with a chair. The complaint is not the lack of information tracking. The complaint is Apple's refusal to share most of that information tracking. The situation is essentially this: The newspaper companies ask Apple what the demographics will be/are for readership for their paper on the iPad, and Apple responds, "Oh, we can't tell you that, but you sold X amount!" That would be like Best Buy telling Apple how many Macs it sold but telling them jack about who bought it.

This kind of information is the FOUNDATION for product development and customer-focus. Without this kind of information no company would stay in business for long, as they would have no way to track customer preferences and trends. The arrangement, as it stands now is Apple asking the publishing industry to bend over and take it with a smile.

When I let my subscription to iNewsweek lapse because it changes its format and now sucks, how will they bombard me with 10 emails a day offering me a low-low price on a renewed subscription if they can't track me?!?!

 

[QuixoticFable]

Frankly, it seems like the print industry is asking for much more than they get now from media outlets selling printed material. The publishers are trying to get something from the digital side they can't get from printed.

Think about your typical brick and mortar outlet like Barnes and Nobel:

1. It's likely the store keeps more than 30% of the sale price of a book or magazine.

2. The publisher gets zero information about me when I buy a book or magazine from a brick and mortar store. I hope brick and mortar stores are selling my information to publishers.

Apple's deal obviously improves the revenue stream for publishers considering the lack of physical printing, delivery, and infrastructure costs. Huge win for publishers here.

I see no negatives for publishers. They aren't losing customer information since they never had it in the first place for any store purchased printed media.

Magazine and newspaper subscriptions will continue to suffer. I can see a reduced cost per issue with a digital "subscription". Maybe that case makes sense to share my information to the publisher. Hey, just like the real world. Anonymity costs me more by buying single issues at the store.

This is a red herring and the dialog shouldn't be hijacked by those trying to gain more revenue and rights than they have now.

You obviously don't understand how this works. You buy anything with a debit/credit card and your name is attached to that purchase. Information resellers get that information then immediately cross-reference it with every other purchase attached to your name and anything else (mortgage, rent, insurance, credit statement, education, etc.) and build a profile of you so they understand your basic personality and interests/preferences. This happens universally. You're fooling yourself if you think it doesn't. Publishers know so much more about their customers than you can imagine.

This is not paranoid, "big brother" talk either, this is just how market research works in the electronic age.

And Apple is trying to cut publishers off from that information stream while only telling them what their sales are. Very raw deal.


EDIT: The only real way around this is to do cash-only for EVERYTHING.

 

[jzuena]

Entering the digital version of things always brings into place piracy. I mean, iTunes has been a great success for music, but the people that currently buy their songs in iTunes, would probably buy the CD if iTunes didn't exist. And besides, with music it is different, since you get the option to buy just one song of an album, so there's an advantage over the physical CD. With magazines or newspapers, there isn't a similar advantage.

If there were a universal reader as suggested above, then there could be impulse purchases of single issues of a magazine or newspaper at full newsstand prices as well as subscriptions at a lower per issue price. Then instead of a card that you can send in for a subscription, you would get a popup after you have finished reading asking if you liked it and would like a subscription. Unless I was sure I wanted a subscription I don't see myself downloading an app just to read a single issue of a magazine while on a flight.

 

[cmaier]

If there were a universal reader as suggested above, then there could be impulse purchases of single issues of a magazine or newspaper at full newsstand prices as well as subscriptions at a lower per issue price. Then instead of a card that you can send in for a subscription, you would get a popup after you have finished reading asking if you liked it and would like a subscription. Unless I was sure I wanted a subscription I don't see myself downloading an app just to read a single issue of a magazine while on a flight.

The problem is that each publisher wants their own layout, their own interactive features, their own way of navigating, etc. It would be quite a task to define a uniform app with a uniform way of embedding apps, allowing the publisher to define its own navigation techniques, etc.

For example, Wired will undoubtedly want the ability to use gray text on a slightly lighter gray background in order to minimize legibility and utility of their magazine. No way Apple allows that

 

[Mr_Ed]

Publishers have spent decades collecting information about subscribers that influence marketing plans and, in some cases, the content of the publication itself.

So, they already have this data. Looking at how print media has been doing in recent years (especially newspapers), I'm thinking maybe this "valuable data" is not really doing much to help them retain readers. What they are really after is a new "easy" source for up to date subscriber data. Uhhm . . . how about, NO! I also hope Apple does not cave on the point of subscriber information.

This is a whole new way of doing business. Given the trend of the population moving away from print media, and if I was in their (publishers) shoes, I might be treating this opportunity with a "what have I got to lose?" attitude?

 

[observer]

You obviously don't understand how this works. You buy anything with a debit/credit card and your name is attached to that purchase. Information resellers get that information then ....

Sorry, I think this is bull. It's true that your name is attached to a credit card purchase, but only at the card company -- and they don't get the name of the item purchased, only the price and the seller. How would information resellers get the linkage between item and purchaser's name? Who would they buy it from? And how much would an info reseller be willing to pay?

The only kind of purchase linkage that I see any evidence for is within a single company. Amazon keeps track of everything I buy from them, and they suggest other things they think I might want to buy. But I see no evidence of linkage outside Amazon -- all of my interests where I don't buy any stuff from Amazon never show up in Amazon recommendations.

Maybe someday soon your paranoia will be justified, but right now, it's pretty clear that linkage of purchases across companies isn't happening.

 

[nagromme]

Apple should let periodicals ASK the user for personal info, and then the user could see exactly what is about to be sent, answer additional demographic Qs IF they wish, and then send the info just to that one periodical. In return for which the periodical would offer a discount, or take away a big splash ad, or offer additional content.

Optional, clearly laid out, and simple. And it shouldn’t be ALL your iTunes info, it should be very selected. Ideally, a publication wouldn’t even ask for your name. Just your zip code, say, and maybe your length of time as a customer. (Your age and gender might be optional extras that iTunes doesn’t normally know.)

I’ve seen free iPhone apps ask for demographics for the advertisers (and since it’s anonymous I don’t mind). Apple providing a standard way to handle this sounds acceptable to me. I know without enough ad revenue, a lot of good content won’t be coming.

 

[RickK]

Publishers have spent decades collecting information about subscribers that influence marketing plans and, in some cases, the content of the publication itself.

You mean those publishers who are on the brink of bankruptcy? Maybe it's time for them to think outside their dead-tree box.

 

[crocodilejkg]

my personal information - stick to your guns apple

I stopped my magazine subscriptions years ago due to all the extra crap the publishers kept sending me. All I wanted to do was buy and enjoy their publication with out being sent adds or called at home.

If I can get a subscription service on the iPad without the publishers getting my personal information; I am all in.

 

[LethalWolfe]

So, they already have this data. Looking at how print media has been doing in recent years (especially newspapers), I'm thinking maybe this "valuable data" is not really doing much to help them retain readers. What they are really after is a new "easy" source for up to date subscriber data. Uhhm . . . how about, NO! I also hope Apple does not cave on the point of subscriber information.

This is a whole new way of doing business. Given the trend of the population moving away from print media, and if I was in their (publishers) shoes, I might be treating this opportunity with a "what have I got to lose?" attitude?

The problem isn't getting readers to go from, let's say, a print edition of the NY Times to NYTimes.com. The problem is that the ad revenue from NYTime.com is small compared to the ad revenue from print editions (even w/the the website attracting more eyeballs than print). The ad revenue from print is plummeting faster than ad revenue from print is climbing. It's the same thing for video as well. An ad that airs during a TV show will be worth more than an ad that 'airs' during a web show. And as much a success as the iTMS is at selling songs the drop in revenue from CD sales is still greater than the revenue generate by online sales.

When it comes to movies and TV shows the iTMS is a by far the lowest man on the totem pole in terms of generating revenue. Something like less than 1% of the revenue from a typical movie will be from online sales like the iTMS. Online sales alone currently can't support the music industry, the TV industry or the movie industry so why should the publishing industry assume that an unproven, $500 (at the low end) device, coupled w/the iTMS will somehow be their savior?

Does printing and shipping cost money? Yes, but the real cost is the people doing the reporting, writing the articles and running the business and those costs don't magically disappear because the delivery medium changes. If anything, IMO, the demand on them goes up because people want everything now. They want news that's up to date to the minute.

While companies do need to keep an eye on the future they'll never make it to the future if they can't stay viable.

Another part to the problem is that, by and large, people don't want to pay for online content and don't like ads either so how are businesses supposed to make money if both ad supported and subscription based revenue models are off the table? Much of the online content out there right now is being subsidized by the old media everyone keeps b*tching about but that can only last so long.


Lethal

 

[pooryou]

The fatal flaw in this whole premise is that anyone thinks a significant number of people will actually pay -money- for digital newspaper and
magazine content. Sorry but the Web has already proven otherwise. If this is the best plan publishers have got, they may as well just hang it up now and not prolong the agony...

 

[cmaier]

The fatal flaw in this whole premise is that anyone thinks a significant number of people will actually pay -money- for digital newspaper and
magazine content. Sorry but the Web has already proven otherwise. If this is the best plan publishers have got, they may as well just hang it up now and not prolong the agony...

You have to take into account that the publishers are not suicidal, and the race to the price bottom is coming to an end. Soon publishers will start to charge for web content, and people who really need their WSJ or NYT will have to fork over the money one way or another. For a significant-enough portion of the world, there aren't real substitutes for these publications.

 

[rhett7660]

The fatal flaw in this whole premise is that anyone thinks a significant number of people will actually pay -money- for digital newspaper and
magazine content. Sorry but the Web has already proven otherwise. If this is the best plan publishers have got, they may as well just hang it up now and not prolong the agony...

I still get a few magazine publications, newspapers not so much. However I would love to be able to save them digitally so that I can have them all anywhere I go. Would I do this for ever single mag out there, of course not. But I like to get a few selected titles each month. The ability to take them with me, whether it be an apple product or another product that is what I am looking for. As far as newspapers go, I would like to see mainly my local stuff. Breaking news bits one can get from so many other sources. Maybe a good RSS feed reader would be the ticket for this type of information on this type of platform. Hell we see it on the desktop/laptop why not here too!

 

[Michael CM1]

Keep in mind that newspapers are as slimy as they come. They'll try and get as much as they can for as little as they can. Most of their cost currently is being spent on paper, printing and distribution, and that's a lot more than 30%. Also, they want the data not to stay in touch with their readers, but to resell that marketing capability to the retail advertisers who foot a lot of their bill (from display ads to inserts). Newspapers are all about advertising ($$$) and not content!

You think most of our cost is on paper and printing? Ha! The No. 1 cost is PEOPLE. You need people to report, edit, design, lay out, photograph, sell ads, sell classifieds, manage all that stuff, manage all those people, yadda yadda yadda.

If you think newspapers are all about advertising, think again. If nobody is reading your content, nobody is seeing your ads. People want ads in the middle of highly read areas, both in print and online.

Some of you act like demographic info is some Ebola virus. Most of it is "in this zip code, the average person is x years old and makes x amount per year." We don't go around dropping off fake Social Security cards.

 

[pooryou]

You have to take into account that the publishers are not suicidal, and the race to the price bottom is coming to an end. Soon publishers will start to charge for web content, and people who really need their WSJ or NYT will have to fork over the money one way or another. For a significant-enough portion of the world, there aren't real substitutes for these publications.

Meh most people wouldn't read this stuff if you gave it to them for free, that's the bottom line.

A tiny slice (those willing to pay) of a small slice (those willing to read) of another slice (those who are even interested) is not a winning business model for anything but a small player with low expectations.

The final outcome is inevitable.

 

[cmaier]

Meh most people wouldn't read this stuff if you gave it to them for free, that's the bottom line.

A tiny slice (those willing to pay) of a small slice (those willing to read) of another slice (those who are even interested) is not a winning business model for anything but a small player with low expectations.

The final outcome is inevitable.

That makes no sense. People certainly subscribe to the hardcopy versions of many of these publications. Why wouldn't some percentage prefer to receive it electronically?

 

[pooryou]

That makes no sense. People certainly subscribe to the hardcopy versions of many of these publications. Why wouldn't some percentage prefer to receive it electronically?

They would.....that doesn't refute what I stated

 

[TheSlush]

Here's a place where this fanboy feels Apple truly needs to bend. I was underwhelmed by the iPad announcement largely because of the lack of publishing deals and the seeming lack of attention (so far) to redefining the approach to digital publishing. The iPad should not be self-stifled in this area simply because Apple would prefer an exact copy of their App Store revenue sharing model.

 

[Thex1138]

Privacy

If Apple gives away my personal information to any media outlet, especially the Murdoch media empire then they can shove any magazine subscriptions, and the iPad! I wont buy any of the crap!
The only reason they needed the information was to know where to post it.
Now all they need is to give the content to Apple so they can send it on to me, the paying subscriber.
It's all about advertorial revenue.
Think about it... you know how readers digest used to hammer your post box... and any other pyramid scheme/spammers... the same will happen with this.

 

[Jason Lee]

Anyone seen this:

http://www.wired.com/epicenter/2010/02/the-wired-ipad-app-a-video-demonstration/

 

[lazyrighteye]

Wait. A. Minute.
Major news papers are closing their doors at an alarmng rate...
magazine publishers are giving away subscriptions that no one wants.
Times are changing & the industry isn't. People consume media/info in
new ways and publishers appear either too stupid or too lazy to adapt. If
not both.

Insert Apple: a savvy company with a knack for helping major
industries successfully transition into a digital age. We've seen it
in the music industry with iPod, we've seen it in telecommunications
with iPhone and we'll see it in print media with iPad. And in iPad,
Apple has done all of the heavy lifting for publishers - offering them
a platform poised to save their sorry butts. And all publishers are
concerned about is maintaing their "relationship with their readers?"
Umm news flash: said relationship is crumbling. Oh wait, if by
"relationship" you meant "selling your personal data for our financial
gains in exchange for articles about which reality tv celebrity is
sleeping with whom," well that's crumbling too. And if this is the foundation of your business model... is anyone here surprised the industry is disappearing? These execs are too dumb to know they're killing themselves. And I say "so long. You had a great run. Too bad your short sighted egos got in the way of maintaining relevance. Suckers."

And what's funny is these same idiots use iPods, can't live without
their iPhones yet fail to see iPad as a similar solution. Seriously
people, get... on... board. This is like 1984 all over again - when the Portland Trailblazers passed on Michael Jordan in favor of Sam Bowie. Sam who? Exactly.

I'm boggled that so many are so critical of iPad. Wait - no I'm not. iPod launch was no different. Same with iPhone. Both had hordes of nay sayers and experts proclaiming their failures even before a single unit shipped. Stranger still, some proclaiming their failures even today. Yet both devices have proven undisputed game changing successes.

It's all pretty entertaining, from my perspective.

 

[LethalWolfe]

The fatal flaw in this whole premise is that anyone thinks a significant number of people will actually pay -money- for digital newspaper and
magazine content. Sorry but the Web has already proven otherwise. If this is the best plan publishers have got, they may as well just hang it up now and not prolong the agony...

The fatal flaw in your premise is that media on the web will be forever subsidized by 'old media.' Hulu, for example, struggles to be profitable and all they do is distribute some of the most popular TV shows around. If Hulu actually had to cover the production costs of the shows it streams the site would fold in a week.

The new media business model has a ways to go before it's viable.


Lethal

 

[kdarling]

Anyone seen this:

http://www.wired.com/epicenter/2010/02/the-wired-ipad-app-a-video-demonstration/

Thanks. Very interesting, especially that they're using familiar Adobe publishing tools to create magazine apps.

Perhaps publishers will sell their digital magazines from their own websites, to work on Macs, PCs, Android, WM, etc phones... and pocketing the whole price... while charging more for the same apps to iPhone+iPad users because they'd have give 30% to Apple's store.

 

[alent1234]

When I let my subscription to iNewsweek lapse because it changes its format and now sucks, how will they bombard me with 10 emails a day offering me a low-low price on a renewed subscription if they can't track me?!?!

Google tracks everything you do and sells it. If they can't get it from apple, they will get it from google analytics