iPad users more willing to see ads than pay for content?

Posted by Emma Heald on January 19, 2011 at 11:32 AM

A new study shows that iPad owners are less willing to pay for apps and more willing to accept advertising in turn for free or lower-cost content, AdAge reported this week. The survey of 205 iPad users, conducted by online research company Knowledge Networks, found that iPad users download an average of 24 apps and of these, only six are paid.

"Not as many people are willing to pay for magazine or news content than we thought they would," Knowledge CEO Simon Kooyman told AdAge. Only 13% of those surveyed said that they would be willing to pay to watch a TV program or read a magazine on the iPad which they already have access to in its standard format, a press release said, while 86% said that they would be willing to watch ads to gain free access to content.

"Early-adopters are currently treating the iPad as an Internet appliance," said David Tice, vice president, group account director at Knowledge Networks, in the press release. iPad users tended to use the device like a home computer, with 97% regularly using Google search, AdAge said, and 91% browsing the web and emailing regularly.

Media apps, on the other hand, are used by 70% of people for reading books, 66% for music, 61% for reading newspapers and magazines and 50% for watching TV and movies.

So what does this mean for newspaper and magazine publishers? Many have keenly welcomed the arrival of the iPad and other tablets as a way to make people start paying for digital news, but these results suggest that it is only a small market that are indeed prepared to pay.

The Financial Times has seen 10% of new digital subscribers sign up for the iPad app, but this is a paper which already has a paid model in place online, and which, as a niche financial publication, has a target market more willing to pay than most.

Should newspapers should focus on creating ad-supported iPad-friendly websites as well as paid apps? Unlike smartphones, which have tiny screens, tablet devices are suitable for web browsing and other online activities. Die Zeit, for one, has decided that as well as providing an app, its website must be adapted to account for the iPad's touch screen.

However, other research from the Reynolds Journalism Institute has suggested that users who consume news on the iPad are more likely to do it using an app than on the newspaper's website. This same study found that app users tend to cancel their subscription to print when they switch to a digital one, a trend that James Murdoch also pointed to.

Clearly, it is too early to come to definite conclusions on the best way to present content on tablet devices: a growing market which saw about 17 million tablets sold last year, paidContent reported, 90% of which were iPads. This year, 44.6 million shipments are expected. Will the highly-anticipated launch of News Corp's iPad-only The Daily shed any light on how to make iPad content pay? And what impact might a new Apple-controlled subscription system have?

Source: AdAge, Knowledge Networks press release