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Bye-bye paperboy: newspaper subscriptions coming to the iPad
by Kathryn Robbins on September 17, 2010
It’s hard to believe, but there used to be a world without the internet and the 24-hour news cycle. You got your daily news from a nightly TV broadcast, radio, and more importantly the newspaper. Newspapers are struggling to find their way in this new world with many of them closing due to declining ad revenue like the Rocky Mountain News. Many publishers hope that an iPad based subscription model could boost their bottom line.
The newspaper industry isn’t just bad, it’s downright horrible. In 2009 ad revenue dipped by 16.9% for both print and online ads, a staggering $7.5 billion drop from 2007. If readers aren’t using the classifieds and businesses aren’t snapping up ad space on your web site, you need to look for alternative sources of income such as iPad owners.
The newspaper subscriptions would be sold via an app that’s separate from the iTunes store and use a similar pricing structure. Apple would take 30% of each subscription sold and up to 40% of the ad revenue. While that may sound a bit harsh, Amazon takes 70% of each newspaper subscription sold.
To get publishers interested Apple is developing software that makes it easier to digitize physical newspapers for the tablet. Newspaper content will reportedly be refreshed automatically so users won’t need to scramble to find the latest news. They are also targeting large media companies that pride themselves on that buzzword “synergy.” For instance, a newspaper article about a local house fire would be accompanied by video from their sister TV news channel.
While they may not have gotten a better pricing split, publishers were able to avoid Amazon’s stance on sharing subscriber information. Instead of keeping all of the data, Apple will share information with publishers so they can tweak their circulation databases and watch what you’re reading.
While Apple isn’t talking, magazine publishers are public proponents of the iPad’s ability to deliver content. Wired magazine’s special projects director Mark McClusky said, "We're still figuring out what we can do with it. It's just an incredibly exciting opportunity to find new ways to tell stories."