According to Bloomberg, Apple is negotiating deals with major publishing companies in order to create a “Digital News Stand”, where users could purchase subscriptions of their favorite newspapers to be read on the iPad, similar to the iBook store. Currently, there are a few magazines and periodicals available as applications through the App Store, but Apple wants to focus on selling subscriptions instead individual issues. Of course, Apple is also asking for a cut of the profits, which is causing dissent among publishers.
As Ken Doctor with Outsell Inc. put it, “Apple is trying to insert itself as a middleman that doesn’t exist in other industries … For example, Sony Corp. doesn’t demand a cut of the revenue from television shows on its TV sets.” This brings up a good point; publishing companies (and print media in general), are having a hard time surviving in the Digital Age, and when it comes to distributing their products, they have a limited set of options: Either stick with print media and eventually succumb to the changing times, or focus their efforts on digital distribution, but be forced to share profits with companies like Apple who want to do things their own way.
The problem is that the internet-generation doesn’t want to pay outright for news. There are hundreds and thousands of free alternate sources of information, like news aggregators and blogs. Of course, some companies will find a working business model that will allow them to profit while keeping perceived prices low, but it seems that many of the veterans have stone-walled and refuse to adapt. But, a happy medium between profit and customer satisfaction can be found. (This also applies to other forms of digital media, and a refreshing response on the issue of monetization and piracy was recently written by the creator of the game Minecraft. It’s an interesting read for anyone, and I recommend taking a look.)
The average user just wants to aquire their media in a way that is convient, cheap, and hassle free. But in reality, there is a lot more than we imagine going on behind the scenes. Newspapers are on their way out the door, and their last chance to survive lies in the iPad, since it is paving the way for the future of content-consumption. Inevitably, they will fold, and Apple’s “News Stand” will be created, but there will be a fair number of disagreements between the two behemoths along the way. Who will win? My money is on the company standing on the high-ground: Apple.