Doctor: iNewsstand “not too far away”

December 17, 2010
Category: Uncategorized

Nieman Journalism Lab
Ken Doctor predicts the long-awaited iTunes subscription news stand is on its way, and might be announced in conjunction with the iPad 2 unveiling in January.

Regardless of the timing — some expected it on Dec. 9 — Doctor describes what he believes it will look like:

  • Tablet and smart phone subscriptions will be enabled, with publishers keeping the revenue.
  • An iNewsstand store for publications will be rolled out.
  • Website access will be restricted in some way to make the news app a viable paid product.
  • Customer authentication and e-commerce processing will be handled by the publisher.

That description is significantly different from Peter Kafka‘s earlier this month. At the time, Kafka believed the store would work like this:

  • App subscriptions would be available through the iTunes store.
  • Apple would keep 30 percent of the resulting revenue.
  • Publishers would have access to limited customer information including name, mailing address and e-mail address.

Publishers entered negotiations with Apple hoping to secure access to customer information and to reduce subscription royalties kept by Apple. If Doctor’s description turns out to be  accurate, it will mean media organizations have made significant progress on those two points.

The major concession for publishers would then be to restrict “free” access to their websites.

This is a strategy already being pursued by Germany’s Bild newspaper. However, Doctor indicates a full pay wall barrier might not be necessary, and a meter-limited approach may be acceptable.

As Doctor notes, the entire process of dealing with Apple is akin to Kremlinology, so the actual details of the arrangement won’t be known until the official announcement. But the concept, as outlined, seems to presage a few possibilities:

  • Smaller publications that cannot fully support app development and e-commerce integrations might move quickly toward the handful of major vendors that can offer those services. The Associated Press, and its relationship with Verve Wireless, might especially benefit from this turn of events.
  • Publishers that prefer to leave their websites freely accessible will be forced to either provide their mobile iOS apps for free as well or to pursue niche apps that do not conflict with the new policy.
  • Media organizations, in either case, may migrate more urgently toward HTML5 solutions which are compatible across multiple operating systems, and would allow publishers continued free choice in their business model decisions.

In any of the above cases publishers still seem to be gaining options and revenue, as opposed to losing ground in their negotiations with Apple.

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