Publishers Initial Response to Apple’s App Store Subscriptions Packages… Muted.

Depending on which side of a magical divide you fall, you will apparently either love or hate Apple’s new subscription packages. The general consensus is that if you like the deal then you are either drinking Apple’s Cool Aid, or taking the view of a long disparaged, and abused consumer. However, if you don’t like the deal you are most likely someone who is involved in large scale publishing which goes through the Apple ecosystem, or simply hate Apple’s “Walled Garden” approach to media sales.

Unfortunately, it doesn’t really matter what we think. Even if we think that being able to opt out of giving our personal data to publishers, or that being able to easily manage all our subscriptions in one payment system, are great ideas. Because what matters is what the publishers think.

So far the battle lines seem to be pretty well drawn as far as Amazon, and Rhapsody (the music streaming service) are concerned. Apple is muscling in on 30% of their cash flow – and they don’t like it. Amazon has met Apple’s announcement, an announcement which would require it to route purchases from its iOS apps via Apple’s iTunes, with a stony silence. And Rhapsody have basically said that they don’t have 30% of their revenue to spare – and went so far as to say they would consider a legal rebuff to Apple’s new contract terms. Reading their financial data this week I actually believe them.

Of all the people who could have a problem with Apple’s plans, those are probably the only two who have a point. They provide all their content directly to consumers, for which they foot the shipping, or bandwidth, and they already pay royalties to content creators; writers, musicians, software companions etc. So another 30% to Apple for simply providing two already high profile businesses with a payment solution seems opportunistic from Apple. On the other hand, for smaller publishers looking for a leg up the 30 / 70 split with Apple is actually a great deal. And for consumers Apple’s price promise means an even shopping playing-field for all.

Other than that, the usual print magazines which only days ago were waxing lyrical about Apple’s iPad, have declined to herald the era of Apple’s Digital Print revolution, with digital subscriptions through the App Store. In fact they’ve barely reported on it.

Most likely all these publishers are more concerned about losing control over our personal data. And any complaints over revenue share could easily be swept aside – or used as a whipping post to drive other demands they’d rather not fight over in public. Advertising crazy Conde-Naste who pepper their web pages with so many garish adverts that even my work Mac is brought to its knees by the explosion of Flash in my browser when I visit their site, and who also brought a version of their Wired magazine to the iPad near launch, were decidedly unenthusiastic about Apple’s new deal. Unsurprisingly so.

At launch yesterday Apple had no new partners to announce with the arrival of Subscription Digital Content. Unusual for them, especially as they have reportedly been negotiating with publishers for two years. And Apple’s only partner currently in this new media adventure is Rupert Murdoch’s “The Daily”. Information on how well the Daily is going has not been forthcoming, and the free period for the digital newspaper has been extend in recent days.

So is it a bust Apple’s new Subscription Publishing model? Probably not. This period now reminds me a little bit of the initial stages of iTunes. And I am sure Apple is playing the long game. “The Daily” may well fall by the way side. But 100s of millions of tablet computers out there in the wild next year are too bigger catch for publishers, advertiser and salesmen to resist.

The publishers are simply biding their time, and hoping to give away less to Apple moving forward. It will be interesting to see who blinks first. But with Rupert Murdoch’s “The Daily” looking like a bust right now, it might be Apple who blinks first – this time.

Do you think Apple will do the same with digital print that it has done with iTunes? Or is this one going to be a tougher nut to crack for Apple? Have your say in the comments…

Advertisement

Stephen NorthcottPublishers Initial Response to Apple’s App Store Subscriptions Packages… Muted.