An iPad FAQ for media companies

With more than 3 million Apple iPad tablets sold in the first 80 days after its launch, there is no question the iPad is a success with consumers. Publishers are now working through the harsh realities of trying to build a sustainable revenue stream around the iPad and other e-reader devices. Here's an FAQ to help magazine and newspaper professionals sort through the clutter.

How do I get my publication on the iPad?

If you have a website, you don't have to do anything, since the iPad supports WiFi and (eventually) 3G wireless for connecting to the Web – and a 9.7-inch diagonal screen for viewing Web pages in all their glory. But if you have a digital edition of your publication (or want to create one) that you want to deliver on the iPad, you’ll need an app.

Should I build my own iPad app? 

Probably not. Unless you've already invested in programmers to develop iPhone apps, you're better off outsourcing your development work. Digital publishing shops such as Zinio or Texterity will take on the task of converting and delivering your digital editions to iPad users (though the two have different approaches for doing so). If you're building a different type of branded app, you can contract with an independent developer or hire a design agency.  

How do I get my app on the iPad?

Developers have to build their apps using approved developer kits and submit their apps to Apple for validation. The approval process is the ultimate black box, involving - and we're just speculating here - a holy tribunal, the burning of incense, a conga line and robots. If you have experience developing an iPhone app, you already know most of what to expect.

Will my iPhone app work on the iPad?

Apple says "almost all" existing iPhone apps will run on the iPad. Only those developed specifically for the iPad will be featured during the launch of the iPad apps store this weekend. Apple has been offering a new software development kit (SDK) to members of its iPhone developer program to create new iPad apps or optimize existing iPhone apps for the new device. Apps built with this SDK will run on all devices that use the iPhone operating system, including the iPad.

There are several lists of approved iPad apps circulating, though this no doubt changes daily as Apple gives its blessing to more apps. 

I already outsource my digital edition to one of those vendors. Will that version work on the iPad?

You'll still need an app for accessing the digital edition. Or the vendor that’s hosting your digital edition will need an app. Plus, if the digital edition uses Flash-based video, you'll need to convert that content to H.264 or another video format supported by Apple.

Oh, yeah, that reminds me - why doesn't Apple support Flash?

Apple likes to control the key technology components of its operating environments. Some consider Flash a memory-hogging, CPU-draining app that's not a good fit for portable devices. Apple didn't support Flash when it launched the iPhone, so the iPad’s lack of Flash support shouldn't surprise anyone. The decision is causing some concern, however, particularly among consumer magazine publishers such as Condé Nast that see the iPad as a promising platform for leading-edge, interactive multimedia.

What many are missing in this debate is the fact that the iPad won’t play any of the existing Flash content on a website. This could be more troublesome for publishers given the prevalence of Flash-based website content and the expectation that many consumers will be using the iPad not just to download apps, but to browse the Web. Can you say "missing plug-in"? 

Are there any Flash workarounds?

There are several. For websites, Brightcove just announced a new HTML5 for streaming video on the iPad's Safari browser. Adobe's Packager for iPhone tool lets Flash developers create native phone apps, but those apps won't run in full-screen mode on the iPad. In January, Adobe said in a blog post it was their "intent to make it possible for Flash developers to build applications that can take advantage of the increased screen size and resolution of the iPad."

Digital publishing company Texterity, which plans to release its first iPad apps in May, will convert a publication’s Flash video content to H.264 as part of its development service for publishers. 

Sean Blanda explores additional options in his post "How to get Flash Video on the Apple iPad".

How much should I charge for my iPad app? Or my iPad subscription?

First-generation digital publications on the iPad are likely to mimic their current pricing models for single issues or subscriptions. Zinio's library is priced similarly to print subscriptions for most publications. 

A better model may be Kindle pricing, which generally ranges from $1.49 to $2.99 a month for popular magazine titles such as Time, Fortune The New Yorker and PC Magazine. Newspapers on Kindle are generally priced between $4.99 and $14.99 a month. 

While many publishers have kept their pricing plans close to the vest, some details are beginning to emerge.  

How much of a cut does Apple take?

Apple takes 30 percent of app revenues. This is a major point of contention for publishers, who argue that renewable subscription sales should be treated differently than onetime app or book sales. 

“Thirty percent forever changes the economics,” one media executive told FT.com in February.

How much should I charge for advertising in my iPad edition?

The biggest potential for publishers eyeing the iPad may lie in display advertising. The iPad's large screen, high resolution, multimedia support and connectivity make it much more accommodating to interactive (read: premium) advertisements. Publishers can also get more creative with their options, offering video and other interactive features as add-ons to base rates.

"Some of the things you can do are just mind blowing," Steve Pacheco, FedEx's director of advertising, told the Wall Street Journal. "You are taking something that used to be flat on a page and making it interactive and have it jump off the page."

What are the sales projections for the iPad?

There's no denying the iPad is a hot piece of hardware. Some estimated that early iPad pre-orders were coming in at a rate of 25,000 an hour. A Morgan Stanley analyst is predicting as many as 10 million iPads may ship this year.

That’s a lot of devices. But it’s not enough to blow the roof off subscription revenues. TBI Research crunched some numbers and concluded that “the revenue opportunity for magazines on the iPad will likely not be enough to counter near-term revenue declines from print operations for the vast majority of titles even if the iPad is a huge success.”

Do I get the customer information for my iPad subscribers?

Some see Apple’s reluctance to share any customer information (beyond sales data) with its app vendors as a potential deal-breaker with publishers, who rely on the data for promotions and advertising programs.

“We have for many years relied on subscriptions to be able to communicate with our readers,” Sara Öhrvall, senior vice president of research at Swedish publisher Bonnier, told FT.com. “It is absolutely crucial to keep the data. That’s something that our advertisers need. It is something that we need.”

Because of the stakes involved, expect this issue to be resolved, either through a compromise with Apple or workarounds from app vendors. Texterity, for example, is developing an in-app subscription process for its digital publication apps in which it will collect subscriber information that it will then share with the publisher, according to Texterity President Martin Hensel. And Zinio’s app takes users to the company’s existing online digital library, where publishers will continue to have access to subscriber data.

So, is the iPad really a game-changer for publishers?

Many are saying the iPad is media companies' path to financial salvation. But at the outset, the iPad is little more than an overhyped distribution channel that will have a negligible short-term impact on the publishing business.

Long term … well, that's another story entirely. The iPad – the concept as well as the device itself – offers an opportunity for publishers to re-think the newspaper or magazine as it relates to a mobile, connected audience. We've seen plenty of cool prototypes about the enhanced experience the iPad can offer.
TechCrunch offers some perspective on what a magazine cover for the iPad should look like.

"The digital edition has always been an afterthought of the print edition,” says Rich Maggiotto, CEO of Zinio. “This is a distribution channel that forces you to think about designing for the medium.” And designing new business models as well.