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Apple signs deals with publishers over iPad subscriptions

Apple signs deals with publishers over iPad subscriptions

After Bloomberg paved the way for making deals with Apple (Business Week was the first business publication to accept Apple's terms over apps subscriptions and signed with the company), the Cupertino giant is moving forward with new deals over iPad subscriptions with other publishers.

Apple's terms have found publishers reluctant to agree on, as Apple stipulated that it would take a 30% share of the subscription price and would refuse to share customer data with publishers, denying them access to statistics that could be very useful in terms of development and advertising.

As Media Post reported, the latest to sign with Apple is Hearst Corp, which has struck a deal to sell digital subscriptions for three titles -- Esquire, Popular Mechanics and O, The Oprah Magazine.

Hearst is the first publisher to sell subscriptions to multiple titles through Apple's iTunes subscription service.

Russel Adams on the Wall Street Journal wrote that starting with July issues, these iPads apps will be available through a service from Apple that allows customers to sign up for subscriptions inside the apps and get billed automatically. Subscriptions to all three publications will be sold for $1.99 a month or $19.99 a year.

As Adams analysed, within Apple's terms there are pros and cons of course.
The percentage Apple takes is high and its control over information about the subscribers is annoying. Publishers also complained about not being able to sell subscriptions directly from their websites and having to pass through iTunes. On the other hand, this service allows readers to subscribe directly inside the app, with automatic billing, which is easier for readers.
Without the App Store - Adams noted - publishers must ask iPad users to download a new issue each week or month, and pay separately for each issue, which of course risks to be discouraging.

Alternatives to Apple's service however are quite limited, even if Google is moving in that direction, experimenting - through One Pass - new ways to work with publishers on the distribution of their paid content.

The WSJ article reported also that according to people familiar with the matter, publishers have recently become more comfortable with the Apple's terms as Apple has shown more flexibility on pricing.

Media Post said that the company relaxed also its total prohibition on disclosing consumer information by agreeing - provided the customers consent - to share names, email address and Zip codes of digital subscribers.

In addition, while it previously refused to allow publishers to make free digital editions available to print subscribers (as, Media Post noted, such an arrangement would take advantage of Apple's iPad platform without compensating the company), it has now relinquished some control and publishers can offer free digital editions to print subscribers.

According to paidContent, rumours, then denied, suggested that Hearst could have had a particularly advantageous deal, but it then appeared that it may not have gotten any special treatment.

Before Hearst, Time Inc signed with Apple to make free digital editions available to iPad owners who are already print magazine subscribers.
The deal involves iPad versions of Sport Illustrated, Time and Fortune magazines.

Also Popular Science have signed with Apple and it reported having sold 10,000 subscriptions in less than 6 weeks.

Adage reported about rumours that Conde Nast may actually beat Hearst to the punch and hit the Apple Store first, as Hearst's magazines won't debut until July.
"Getting something out first is what ultimately matters in the short term," said an employee at Conde Nast, which publishes magazine such as The New Yorker, Vogue and Bon Appetit. "In the long term it's going to come down to subscriptions, who's in a better position with an audience and a brand that can sell the most amount of subs. A year from now whoever has the most amount of subs wins. It doesn't matter who gets the press release out soonest, the article said.

Sources: Media Post, Wall Street Journal, ZDNet, Adage, paidContent



Federica Cherubini


2011-05-05 14:13

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