Choosing sides in the great Apple-Google subscription debate
There’s been a frenzy of activity over the past two weeks around digital subscriptions. First Apple, then Google introduced new subscription services for their respective tablet and smartphone platforms (Google’s One Pass will also work with Web payment systems).
A potential steel-cage death match between Apple and Google has the pundits licking their chops and placing bets on a possible winner. Publishers, meanwhile, must now make some hard decisions about which subscription model to support (none, one or both).
Here’s a rundown on how the respective camps are shaping up, with some quotes that provide insight into each publisher’s positioning.
The Apple Camp
Bonnier’s Popular Science was first out of the gate with in-app subscription support on the day of Apple’s announcement. The offer: 1 year for $14.99, a promotional price that will rise to $19.99.
Telling quote: “Our iPad readers let us know they wanted the ability to buy annual subscriptions using their existing iTunes account, and we’re happy to deliver on their demands.” – Gregg Hano, VP, Group Publisher of Bonnier’s Popular Science.
Another launch partner, Hachette Filipacchi Media U.S. said it would begin offering monthly and annual subscriptions to Elle, priced at $2.99 and $18.99, respectively.
Telling quote: "Rather than a complicated route to purchase, now we're using a seamless subscription scheme, and a cost-effective price point. This is a game-changer in our industry." – Julia Schulhof, director of emerging platforms for Hachette.
Future, a UK-based media company that publishes digital editions of 50 titles through Zinio, quickly announced that it would use Apple’s subscription service for one of its iPad-only publications, called T3.
Telling quote: “The arrival of subscriptions comes at the perfect time.” – Niall Ferguson, Future’s technology portfolio director
This indie magazine was one of Apple’s launch partners. It believes its loyal subscribers will agree to let Apple share their information with the publisher, Editor in Chief Marvin Scott Jarrett told Advertising Age.
Telling quote: "As long as they're paying the money to subscribe, why should we care that much?" – Jarrett
PixelMags is supporting the Apple subscription service in its digital publishing platform and its forthcoming digital newsstand, called iNewsStand.
Telling quote: “We support Apple’s goal of offering publishers new opportunities to expand their digital offerings and believe it benefits our clients and the consumer.” – COO Ryan Marquis
The Google Camp
Two weeks ago, Time unveiled its new “All Access” digital subscription model for Sports Illustrated, consisting of a single monthly or annual price that encompasses print delivery and digital access through the Web and Android devices. (It has not announced support specifically for One Pass.)
Telling quote: “The new subscription options give consumers flexibility and convenience they desire and ensures that our multiple revenue streams continue to grow.” – Mark Ford, Time Inc. EVP and President of its Sports Group.
Popular Science was also one of the first out of the gate to support One Pass – which Google announced just one day after Apple introduced its in-app subscription service. Annual subscriptions to Popular Science are the same for the Apple and Google platforms.
Telling quote: "We want to be able to distribute and sell our content across all platforms and make it easier for the consumer to discover, access and consume it, hopefully by paying for it one time." – Hano
Germany’s third largest news site is experimenting with Google One Pass to charge for select features on its website. It’s a modest experiment: the articles cost just 10 cents to access.
Telling quote: “This isn’t about transforming our business, the majority of our income will be advertising for a long time to come, but it is about testing what else could work.” – Armin Blohmann, head of communications and investor relations at parent company Tomorrow Focus.
The large German publisher was at Google’s launch event but has not specified its plans for One Pass.
Telling quote: "We hope that One Pass will quickly be developed into a general platform for easy payment on the web, as well as on mobile and [the] app world, to become a real alternative to existing [payment] systems." – Andreas Wiele, head of Axel Springer’s Bild division.
Media General, a regional publisher in the southeastern U.S., said it will use Google One Pass this year as part of its paywall strategy for the Richmond (Va.) Times-Dispatch. The Times-Dispatch said on its website that it has not finalized when the pay system will launch or what content will be included in it.
Telling quote: "We will pilot Google One Pass as we develop new premium content and services that connect with subscribers across digital platforms and devices. We think this will open up new audiences as well." – Rick Thornton, vice president for audience and content development, Richmond Media Group.
The Apple Critics
Readability has developed a Web service that lets users read text-based versions of online articles. CEO Richard Ziade posted an open letter criticizing Apple after his company’s app was rejected for violating Apple’s in-app subscription requirements – meaning that it included Readability’s own subscription system but did not offer a similar option to purchase through the App Store.
Telling quote: “We believe that your new policy smacks of greed.” – Ziade
The International Newsmedia Marketing Association hosted a summit in London last week with almost 60 European media executives. The meeting featured “a robust and sometimes intense discussion of new app subscription plans by Apple and Google” and some frustration over Apple’s “unclear rules.” The INMA also posted a statement proclaiming its optimism for Google One Pass and skepticism over Apple’s service requirements.
Telling quote: “News publishers are being asked to swallow 30 percent for Apple and give up ownership of the customer relationship and how they price and promote their apps. If you combine these three elements, the Apple policy suddenly impacts the newspaper business model beyond tablets.” – Earl J. Wilkinson, INMA executive director and CEO
Some publishers and trade associations have been guarded in their public comments about Apple's subscription service. They cite uncertainty with the terms or acknowledge some progress while nudging Apple to be more flexible, specifically regarding customer data. Call them diplomats, or fence-sitters, but they’re not ready to draw a line in the sand - at least not yet.
Time Inc.: A spokesman told Advertising Age: "It seems like Apple is taking a step towards our position on subscription offerings, but the announcement also raises many questions around consumer data we would need to work through and agree on."
Financial Times: An FT spokesperson told paidContent UK: “It is still unclear how Apple’s proposed new subscription business will work for publishers. But we obviously have concerns over changes to an approach that has so far worked well for our readers and the broader publishing ecosystem around tablet devices, and that may compromise our business model.”
MPA-The Association of Magazine Media: President and CEO Nina Link told the Wall Street Journal: "We feel there's more to go in order for it to work with publishers. We'd love to see more flexibility and have it be friendlier in terms of the publishers' relationship with the consumer."