A Possible App Store for Ailing Newspapers

By Cindy Waxer September 16, 2010

The dinosaurs of the media industry – newspapers – may soon be looking to Apple to provide a fresh and innovative source of revenue.

According to an article in the San Jose Mercury News, Apple is entertaining the idea of launching an App Store-based subscription plan for newspapers. The Cupertino behemoth is keeping quiet but the article describes a revenue model in which Apple will take a 30 percent cut of all subscriptions sold through the company’s online App Store and a 40 percent cut of the ad revenue generated by the publications’ apps.

Currently, a number of national newspapers are peddling app subscriptions to iPad owners. The Wall Street Journal, for example, grants access to all of the paper’s free content and features, updated coverage throughout the day with top article picks from Journal editors, market data including quote search, videos and slideshows for $3.99 a week.

Other publications including metropolitan papers are preparing to deploy their own publication apps or are waiting to see how iPad apps from the Wall Street Journal and the Financial Times play out. Earlier this summer, the New York Times updated its iPad app – heavily criticized for its small amount of content, by adding an Arts section and some videos. Additional changes include re-sizable text and the ability to share stories on Facebook, Twitter and email.

Nevertheless, the San Jose Mercury News reports that not all publishers are “happy” with Apple’s terms and a fee would be preferable to offering up a cut of subscription and advertising revenue. What’s more, not being able to offer app editions as part of a subscription bundle requires letting Apple play the middleman in its ongoing dealings with readers.

In the end though, the ball might be in Apple’s court as the struggling newspaper industry tries to find new ways to survive in a rapidly evolving media environment.

Edited by Erin Harrison

TechZone360 Contributing Editor

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