Posts Tagged subscriptions
News Corp.’s digital newpaper The Daily began life as a newspaper for tablets, hoping to get users to spend money on a daily digital publication. They’re continuing to try and make it work, but it appears that a new strategy is forming as time goes on.
The Daily has been increasingly partnering with various brands to publish apps that focus on a sole subject or piece of content that can also act as sponsorship opportunities. The recent Angry Birds Space guide is part of this push, but are not the first separate apps The Daily has done. They’ve also created special apps for the start of the NFL season, a guide to college football bowl games, and a holiday gadget guide.
The purposes of these apps are not just to generate revenue by working with corporate sponsors, but to also serve as ways to generate subscriptions for the main Daily publication, as these free apps help get the name of The Daily and its content out there to potential readers.
As well, the launch of the Angry Birds Space guide for iPhone may be a harbinger of the publication coming to the smaller screens at some point, which could help The Daily reach the lofty subscription goals that were laid out for it, as only a few months ago they were well below a level that would make the publication profitable.
Apple has made a rare flip on their policies, particularly in regard to their subscription rules introduced back in February. The rules (as written then) would require apps that offer subscription services to also sell the subscriptions through the App Store, with Apple to take their customary 30% cut; this would also apply to apps like Kindle and Nook, where the books they sold would have to run through Apple’s system as well. This could have had some very chilling effects on the future of subscription services’ apps on iOS, particularly services that were already operating with low overhead.
However, Apple has largely rescinded these rules, allowing for apps to continue to offer access to media and subscriptions without offering to sell them through the App Store as well. However, Apple has changed a policy to where apps cannot offer a link to buy these subscriptions and media through the app. This means that the Kindle app will likely have to remove its button to open up the Amazon web site to buy books. However, services like Netflix would not have to risk choosing between the sizable iOS user base and starting to give Apple a 30% cut of their subscription fees for subscriptions purchased in the app itself.
For those looking to start using Apple’s in-app subscription model, it appears that Apple has offered them a reprieve as well. Previously, according to Apple’s App Store Review Guidelines rule 11.13, “Apps can read or play approved content (magazines, newspapers, books, audio, music, video) that is sold outside of the app, for which Apple will not receive any portion of the revenues, provided that the same content is also offered in the app using IAP at the same price or less than it is offered outside the app. This applies to both purchased content and subscriptions.” This price requirement has been removed, so hypothetically apps could raise their subscription prices on iOS in order to compensate for Apple’s 30% cut.
The modification of these subscription rules will ultimately be good for developers and users; if left in place, they could have made releasing apps on iOS an unprofitable decision, limiting the potential of iOS devices solely because Apple felt like taking a cut from developers. This move is ultimately good for all parties involved, and Apple stepping down on this requirement shows that they are willing to listen to the outrage from their community.
Source: All Things D
SPIN Magazine and Spin.com have launched a digital subscription based magazine for the iPad that offers all the news and reviews from Spin.com – but also adds subscription based content from the magazine, pairs it with streaming music to add the experience, and gives you the ability to listen to songs straight from the app itself.
These are the sorts of innovative ideas that will launch New Media into the future, a fantastic concept from a music magazine. Instead of simply offering a digital version of the print magazine, or offering exclusive content which isn’t particular interactive, they’ve gone a step further, an interactive and user-based experience, which is built perfectly for the iPad environment.
The free app will feature a steady mix of news and articles from Spin.com for no cost, which is what you’d expect from any basic app. For $1.99 an issue (or $7.99 annually), you’ll receive your SPIN Play subscription which gives you all the content of the print version, however you’ll get something that the print users wont, 60-plus songs and 30-plus exclusive videos.
Boosting the popularity and notoriety of the bands and artists that they interview and feature is obviously paramount to the magazine. Moving forward into digital content delivery like this will definitely help. It also sets a benchmark for websites, magazines and newspapers from here on out. The possibilities to feature digital media content on a monthly subscription basis certainly isn’t a new concept, but pairing it with the ease of use of the iPad, the want for instant-media delivery, and to do it at a price point that competes with the print version is definitely setting a new standard.
I for one look forward to the new digital playground that this could start, and hope that most other publishers who are thinking of launching digital versions, or even current publishers looking towards the next best upgrade for future versions, should look to Spin Play as an example of ‘doing it right’.
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As we mentioned in our previous post, Apple has published changes to their agreement with developers today that require that subscription services that offer digital subscriptions outside of their apps also provide them inside the app. And any subscriptions done inside the app will be subject to the 30% fee Apple charges for items sold through iTunes. This change applies to newspaper and magazine subscriptions as well as other digital content like music and video services.
Apple feels as though they are providing lots of new users for these services and Apple wants to be compensated for that. That makes sense. They are providing a service and bringing users to these subscription services, they should be compensated. But in the end, it’s going to backfire and we the users are going to lose out.
We reached out to a bunch of subscription service app developers for comment. Most are still evaluating the rule changes. Zinio and Rdio both told us that they are not commenting on the changes at this time. Rhapsody has clearly stated that they will pull out of the App Store if required to pay Apple 30%.
The real problem is that most of these service providers are providing licensed content. If you add up the licensing costs and the cost of providing the service (servers, app development, all the costs of doing business) there’s rarely 30% remaining in profit for the companies involved. There’s just no way that they can pay Apple 30% and still operate in the black.
To abide by these new rules, developers really have just 3 options. And in all three of these options, we the users are the real losers.
Option 1 – Pay up
Just pay the 30% for subscriptions through the app. Consider it part of the cost of acquisition for new customers. Companies aren’t going to be happy to lose that revenue and in the end, will go with number 2.
Option 2 – Increase Prices
The other option is to increase prices to balance out the 30% decrease in revenue. This, of course isn’t good for us, the users. It’s also not good for the companies involved where low price is a big draw. Increasing prices could be done across the board or as part of a iOS-only mobile access subscription package.
For instance, Rhapsody has their streaming cost of $10 month for streaming. But what’s to keep them from defining that as a service for any device other than iPhone and iPad? Then having a second offering for a streaming service to iOS devices for $15 per month.
We’re already sort of seeing this from companies like Mog, the music service. They charge one amount for streaming to the desktop and another amount for streaming to the desktop and mobile.
Now, let’s be clear, no one wants this to be the option. It stinks for the consumer as it adds confusion and it stinks for the companies selling the service. Not good, but seems like it will bypass the rule changes. Now, will Apple allow it, we’ll have to wait until companies start testing the boundaries of the rules to see. As we know from the past, Apple has the ability to interpret their rules however they wish and change their mind at any time.
Option 3 – Pull out
The only other option is to just pull out of the App Store. Remove the app from the App Store and lose out on the exposure. Users really lose if this happens.
Option 3b – Go HTML5 / Web App
Once out of the App Store, some developers could probably forego the native app and and go web app based. No reason a music streaming service couldn’t do that as most already provide this service on the desktop. But there will, at least initially, some lost functionality and confusion for users.
In the end, it’s us, the users of these apps that will lose.
[Response to: TechCrunch ]