Today representatives from Conde Nast told AdAge that they are slowing the addition of any new Conde Nast magazines to the iPad. Why? According to AdAge, Conde Nast feels “conditions aren’t quite right yet to deliver the ideal app editions at the kind of scale that advertisers want.” In other words, sales aren’t stellar.
Sales won’t get stellar until magazine publishers wake up and reduce the per-issue prices of their magazines by 60-80%. An issue of GQ on the iPad costs $4.99, but the same issue of GQ through a subscription is priced at little more than a buck. Everyone knows magazines don’t make most of their money from selling issues to consumers; they make it from ad revenue, and that ad revenue is going to lack big time until more people start buying magazines on the iPad. That won’t happen until magazine publishers lower their subscription prices.
Besides the frankly stupid pricing of magazines on the iPad, there’s another problem that’s keeping magazines from flourishing: there’s no unified magazine store. Right now most magazines are available as free apps, and then the user pays a ridiculous price per issue through the app. Magazine publishers should be begging Apple to create an iNewstand app, much like the iBookstore, where users could easily browse all magazines and buy an issue with a click for US$0.99 each.
That price seems low until you look at the yearly subscription rates for, say, Time or Entertainment Weekly (EW). You can get an annual supply of those mags for around $20 bucks a year. Fifty-two issues of EW at 99 cents would still net EW over $50. Even after Apple took 30% that’s still way more than EW’s annual subscription rate. An iNewstand store with a killer search function that indexed articles in the magazines would allow users to search for articles on a topic of interest and that, in turn, would lead to increased sales because the user might never have considered looking in a specific magazine before.
I’ll just finish by saying this: magazine publishers, your iPad distribution model sucks. It’s backwards and it’s costing you not only a lot of sales but — more importantly to your ad revenues — a lot of potential new readership and circulation numbers. Go to Apple and beg them for an iNewstand store, and then sell your digital issues for 99 cents and yearly subscriptions for around $10. Do this and it’s a win-win not only for you and Apple, but your advertisers and readers as well.