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Rolling Stone co-founder slams publishers for embracing Apple's iPad

post #1 of 148
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Following a wave of magazines embracing Apple's in-app subscription plans, the co-founder of Rolling Stone has gone against the grain and categorized the industry's move as "sheer insanity and insecurity and fear."

Jann Wenner, owner of Wenner Media, said in an interview with Advertising Age that magazine publishers are "crazy" to embrace the iPad. He said current products available on Apple's tablet are selling just a few thousand copies, a revenue stream that's not enough to compensate for money lost in research in development.

"They're going to get less money for it from advertisers," he said. "Right now it costs a fortune to convert your magazine, to program it, to get all the things you have to do on there. And they're not selling."

Wenner believes it will take decades before magazines on tablet-style devices like the iPad will take off, noting that sales of physical CDs are still a popular form of music even as Apple's iTunes offers more convenience and flexibility.

"I think that they're prematurely rushing and showing a little confidence and faith in what they've really got, their real asset, which is the magazine itself, which is still a great commodity," he reportedly said. "It's a small additive; it's not the new business."



Wenner Media publishes Rolling Stone, as well as Us Weekly and Men's Journal. Wenner said that users can get copies of magazines through Zinio or their official websites.

He said he wouldn't be interested in brokering a deal with Apple, because the iPad maker would "mortgage [him] into the future on the basis of getting 2,000 copies sold a month." He said even a success story like Popular Science sold only 16,000 subscriptions, well less than its 1.2 million print subscriptions.

"Their story is simple," Wenner said of Apple. "They want to go knock off the weakest of the big guys and then use that as a lever. They were having no success with Time Inc., because they weren't going to give, so they went to Hearst. And really Hearst has just given then a couple of titles."

Early this month, it was revealed that Hearst Corp had reached a deal with Apple to begin providing content on the iPad via Apple's in-app subscription plan, in which Apple takes a 30 percent cut of all transactions. STarting in July, Esquire, Popular Mechanics, and O, The Oprah Magazine will be available with in-app subscriptions for $19.99 per year.

Around the same time, Time also reached a deal with Apple, but only to allow print subscribers free access to issues of their magazines on the iPad. The publisher's magazines, including Sports Illustrated, Time, and Fortune support subscriber authentication, but Time and other major publishers have not yet reached a deal for selling digital subscriptions for iPad editions of their magazines.

However, unlike Time, publishing giant Condé Nast did agree to allow subscriptions on the iPad through Apple's recurring in-app subscription service. The feature has been added to a number of its publications, including The New Yorker, Wired, Golf Digest, Glamour, Vanity Fair, Self, Allure, and GQ.
post #2 of 148
Absolutely true.

Remember the days when the dot-coms were threating to send ALL brick and mortars businesses the way of the dinosaur?

Guess who is still standing?

Brick and Mortar stores.

The same analogy applies here.

Books, no matter how much the e-books devicer makers, electronic makers and publishers like to boast, are here to stay.

The same applies to magazines.

Hundreds of years of acclimation to printed press will not vanquish in thin air in a matter of mear 10 years.

The print is versatile, requires no energy, flexible (moldable), can go through storms and still survive, be somewhat water proof (after it dries), be used as a quick umbrella during rainy seasons, folded into paper airplanes, can make origamis, used as a paper football, etc etc.

Paper FTW

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"Like I said before, share price will dip into the $400."  - 11/21/12 by Galbi

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post #3 of 148
I always thought it was insane for a magazine to give away 30% of its sales to Apple, simply for selling through the App Store.

If I were the magazine industry, I would threaten to only support Android until Apple came up with a more reasonable fee.
post #4 of 148
Following a wave of magazines embracing Apple's in-app subscription plans, the co-founder of Rolling Stone has gone against the grain and categorized the industry's move as "sheer insanity and insecurity and fear."

This statement was originally painted on the co-founders cave wall in pictographs.
post #5 of 148
Quote:
Originally Posted by Galbi View Post

Books, no matter how much the e-books devicer makers, electronic makers and publishers like to boast, are here to stay.

The same applies to magazines.

Hundreds of years of acclimation to printed press will not vanquish in thin air in a matter of mear 10 years.

Well yeah, of course physical media isn't going to go away anytime soon. But we're talking about having a digital version/app in addition to the printed press. Just like there is a market for e-books/consumers who prefer e-books, there will people who prefer the digital version/app.

And yes, there will be an upfront cost, but eventually there's going to be some sort of automated process with no printing cost. So why not think ahead and take the jump?

Quote:
Paper FTW

Seriously.......?!
post #6 of 148
And I wonder how much hate mail Wenner got or is going to get for her blasphemous statements against the almighty Apple corp.
post #7 of 148
Quote:
Originally Posted by k2director View Post

I always thought it was insane for a magazine to give away 30% of its sales to Apple, simply for selling through the App Store.

If I were the magazine industry, I would threaten to only support Android until Apple came up with a more reasonable fee.

Judging from the money developers are making from Android apps, 70% of something from the Apple app store is better than 90% of nothing from Android.
post #8 of 148
Quote:
Originally Posted by k2director View Post

I always thought it was insane for a magazine to give away 30% of its sales to Apple, simply for selling through the App Store.

If I were the magazine industry, I would threaten to only support Android until Apple came up with a more reasonable fee.

The way I read the article, it was against all electronic readers, the conversion of the mag, the programming etc. The iPad is perhaps singled out because its already become somewhat of a generic term
post #9 of 148
Wow, only 16k subscriptions for a well-read magazing like Popular Science. That is a surprisingly low number. Looks like it's going to be a bit before this really takes off. With Apple taking 30% off the top, I can totally see why.
post #10 of 148
Agree, why not port to Android - which will be the bigger market anyway - and wait for Apple to come to it's senses? Apple is ultimately a device manufacturer. They should try to restrain the impulse of also deciding what content should be available to whom, and at what price. Frankly I don't consider them ideal arbiters of free choice and expression.
post #11 of 148
Quote:
Originally Posted by AppleInsider View Post

Wenner believes it will take decades before magazines on tablet-style devices like the iPad will take off

Decades...? BWAHAHAHAHAH!!!!
post #12 of 148
Quote:
Originally Posted by Galbi View Post

Books, no matter how much the e-books devicer makers, electronic makers and publishers like to boast, are here to stay.

The same applies to magazines.

Way to jump to extremes. :roll eyes:


Quote:
Originally Posted by k2director View Post

I always thought it was insane for a magazine to give away 30% of its sales to Apple, simply for selling through the App Store.

If I were the magazine industry, I would threaten to only support Android until Apple came up with a more reasonable fee.

How much of a markup do stores put on printed material? Less than 30%? Do you also refer to publishers as giving away their sales when B&M stores mark up their printed items?
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post #13 of 148
Quote:
Originally Posted by Freshmaker View Post

Wow, only 16k subscriptions for a well-read magazing like Popular Science. That is a surprisingly low number.

Yes, but we also don't know how many of those 1.2 million print subscribers have iPads...
post #14 of 148
Quote:
Originally Posted by Galbi View Post

Absolutely true.

Remember the days when the dot-coms were threating to send ALL brick and mortars businesses the way of the dinosaur?

Guess who is still standing?

Brick and Mortar stores.

The same analogy applies here.

Books, no matter how much the e-books devicer makers, electronic makers and publishers like to boast, are here to stay.

The same applies to magazines.

Hundreds of years of acclimation to printed press will not vanquish in thin air in a matter of mear 10 years.

The print is versatile, requires no energy, flexible (moldable), can go through storms and still survive, be somewhat water proof (after it dries), be used as a quick umbrella during rainy seasons, folded into paper airplanes, can make origamis, used as a paper football, etc etc.

Paper FTW

Paper books, sure to stay for a long time, paper mags, whose content (apart from ads) is out of date so quickly, will gradually succumb more and more to e-tablets.

As for embracing it, the time for this is not an instant, a day, or even a year. If some publishes did not start with the trend, then how would things ever change. A forest may not start with a single acorn, but it does start with a few
post #15 of 148
Quote:
Originally Posted by Whozown View Post

And I wonder how much hate mail Wenner got or is going to get for her blasphemous statements against the almighty Apple corp.

Your auto-response software needs a better database.
post #16 of 148
I don't get it, aren't all magazine's produced digitally and then printed? Isn't the iPad version simply the digital version before it gets printed? Other then some optimization, it seems to me that iPad editions would cost less to produce since the magazine is going get put together on computers anyway.
post #17 of 148
Quote:
Originally Posted by Galbi View Post

Absolutely true.

Remember the days when the dot-coms were threating to send ALL brick and mortars businesses the way of the dinosaur?

Guess who is still standing?

Brick and Mortar stores.

The same analogy applies here.

Books, no matter how much the e-books devicer makers, electronic makers and publishers like to boast, are here to stay.

The same applies to magazines.

Hundreds of years of acclimation to printed press will not vanquish in thin air in a matter of mear 10 years.

The print is versatile, requires no energy, flexible (moldable), can go through storms and still survive, be somewhat water proof (after it dries), be used as a quick umbrella during rainy seasons, folded into paper airplanes, can make origamis, used as a paper football, etc etc.

Paper FTW

How many brick and mortar stores need to go out of business before you see what's happening? Where are the brick an mortar music stores? Netflix just killed Blockbuster, Borders just declared bankruptcy. Amazon just declared they sell more Ebooks than print. It's happening right now. I think Jann Wenner is insane if he thinks it's going to take decades.

I suggest he go back and review his high school math and take a look at the exponential curve; the rate of technological change clearly fits this model. The problem with people who are stuck in the past is they think the rate of change is linear. This change is going to happen faster than most people realize. Less than a decade. Publishers who are investing in this technology now will have a distinct advantage over those who waited.
post #18 of 148
The co-founder of Rolling Stone can't roll with he times and responds to change with "sheer insanity and insecurity and fear." What ever happened to the green goal of a paperless society that embraces trees?
post #19 of 148
wenner is absolutely right...until he is wrong.

things have just begun moving along. did itunes sales overtake cds in the first year? no, it took several years but this will happen even more rapidly this time because the itunes ecosystem is more established with much more hardware support than it used to have.

and what is wenner's example of brick and morter and cd sales? has he looked around lately to see store closings and mp3s overtaking cd sales?

print media will always have some usefulness to someone but when the tables are turned and there are only 2000 printed subs out there compared to millions, people will ask "why did we ever need printed magazines? who still reads those?"
post #20 of 148
Quote:
Originally Posted by Freshmaker View Post

Wow, only 16k subscriptions for a well-read magazing like Popular Science. That is a surprisingly low number. Looks like it's going to be a bit before this really takes off. With Apple taking 30% off the top, I can totally see why.

the business model of the New Yorker is that if you have a subscription you can read it on the ipad. I love it! I can pick it up anytime and continue reading the magazine, downloading new issues, and keeping up on the move without carrying a magazine with me. My experience with Pop science was cool the first time.. but I think it was $5 an issue? it was too much to pay for a single issue with no subscription deal.. maybe that has improved. Also, the initial sales of the ipad were to early adopters, and people with disposable income. Popular science might take off later on when it has a subscription plan.. and the mass market owns a table device.

After Playboy announced their plan, i had hoped that The Rolling Stone would do the same thing. i would pay $60 a year subscription to be able to read all the articles from years past via archive access for every issue. a little nostalgia goes a long ways with the rolling stone.. with fab interviews from years ago that would be fun to read again.. Reading on a tablet is here to stay.. it is just a matter of time and the market for reading will mostly be available on tablets as well as print. To be slow to adopt only means they are missing the future of an entrenched mode of media that is part of the future. Later on, I hope they will publish both in print and on tablet media.. I would rather have all my magazines in one device.. for me, that is the future..
post #21 of 148
Quote:
Originally Posted by k2director View Post

I always thought it was insane for a magazine to give away 30% of its sales to Apple, simply for selling through the App Store.

If I were the magazine industry, I would threaten to only support Android until Apple came up with a more reasonable fee.

Hmmm...
70% of sales to users who actually buy, vs 90% from users who want everything to be free.
Tough call.
post #22 of 148
Quote:
Originally Posted by Galbi View Post

Absolutely true.

Remember the days when the dot-coms were threating to send ALL brick and mortars businesses the way of the dinosaur?

Guess who is still standing?

Brick and Mortar stores.


Paper FTW

IMHO Brick and Mortar stores are disappearing. So if you look at Amazon, where do they get the sales from?? Brick and Mortar?? They may be standing but not at the same margin as before. Look at consumer electronic stores, how many are still standing?
post #23 of 148
I'm wondering why so many people bring up the 30% that Apple charges for hosting, distributing, collecting sales and making payments to it's media suppliers.

These people always make it seem that Apple is ripping someone off?

Dont they realize that when they buy something in a store... that the store (depending on the location and product) is charging you from 15 to 60 %
post #24 of 148
Quote:
Originally Posted by 11thIndian View Post

Decades...? BWAHAHAHAHAH!!!!

Yeah, someone send this to John Gruber. This is definitely claim chowder material!
post #25 of 148
Hmm,

30% doesn't sound so bad to me... Coming from the newspaper business I can think of the following expenses that are offset with the iPad.

Printing
Postage
Packaging
Retail markup

We don't really make money on subscriptions, we make money on advertisers. There also is an economy of scale difference here. If a newspaper/magazine grows their print costs still increase. They have to hire more staff for distribution, install or use larger presses, etc. What cost increases the more digital subscriptions they sell???
post #26 of 148
It may take 2 to 3 years before a real backlash occurs, but it may be more gradual than sudden. As the magazine industry assesses casualties and realizes its place comparing apple against the rest, slowly, one by one, publishers will tell Steve Jobs to go sharpen his pencil.

Quote:
Originally Posted by k2director View Post

I always thought it was insane for a magazine to give away 30% of its sales to Apple, simply for selling through the App Store.

If I were the magazine industry, I would threaten to only support Android until Apple came up with a more reasonable fee.
post #27 of 148
I'm curious what people think it costs a magazine to distribute a physical copy of their material around the globe? Does the man in the newsagent work for free? Does the delivery boy? Does the lorry driver? Does the printer? I could go on.

These media companies can't have it both ways. They tell us an ebook is as valuable as a printed copy because we're buying the content not the book, then they balk when Apple asks for a cut of the profits they have made entirely due to Apple's complete invention of a new market for them, as well as Apple doing all their distribution for them. So what if there's only a few thousand customers right now, Apple are charging a percentage, not a flat fee!

I don't think the 30% Apple want is being rejected because it is too much; it's being rejected because these companies don't feel Apple deserve it, rightly or wrongly.
post #28 of 148
The Economist is happy with its sales. Print magazines need to allow digital access, and vice versa. The iPad needs a magazine section. Apple needs to allow cheaper subs if people give details.

The the iPad will make money.

Even popular science is making money. 16000 subs will take the cost of developing for the iPad in about 6 months. All subsequent costs are merely the down load. It is, in digital format anyway, or some kind of XML and data. Once that is worked out the app devs can generate the app version from a "manifest". Recurring costs are zero. Unlike print. Which has to be printed and distributed.

Apples 30% is a lot for re-sellers, for rolling stone, it is a good deal.
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post #29 of 148
Quote:
Originally Posted by magicj View Post

Not surprising to me. Before you can subscribe to Popular Science on the iPad, you've got to know Popular Science is on the iPad.

I never knew it until I read this article, and I'm in the iBook Store and the books section of the App Store all the time.

iBook Store doesn't even have a "magazine" category. Neither does App Store. You can search directly for "Popular Science", but unless you're thinking about "Popular Science", you're unlikely to stumble across it.

Isn't a large part of the argument for the 30% given to Apple that the App Store acts as some kind of publicity platform?
post #30 of 148
Quote:
Originally Posted by See Flat View Post

I'm wondering why so many people bring up the 30% that Apple charges for hosting, distributing, collecting sales and making payments to it's media suppliers.

These people always make it seem that Apple is ripping someone off?

Dont they realize that when they buy something in a store... that the store (depending on the location and product) is charging you from 15 to 60 %

That's becuase it's costly to open a physical store.

If we actually have an open internet, the cost of opening a competing web store to sell digital magazine would be much lower, which means the digital store (in this case Apple's app store) shouldn't charge nearly as much. But obviously, this is not an open OS so that's why Apple can charge the local-monopoly price. Same for Android (which is not really open either).
post #31 of 148
Quote:
Originally Posted by AppleInsider View Post

Wenner believes it will take decades before magazines on tablet-style devices like the iPad will take off, noting that sales of physical CDs are still a popular form of music even as Apple's iTunes offers more convenience and flexibility.

This dude apparently did too much LSD in the 60's and fried his brain.

Yeah, i love CDs, and haven't yet embraced digital downloads but even i understand that the CD's days are numbered.

Newspapers, magazines and books are all dinosaurs, and dying even more rapidly than the music industry. The handwriting is on the proverbial wall. Change is afoot.
post #32 of 148
Quote:
Originally Posted by See Flat View Post

I'm wondering why so many people bring up the 30% that Apple charges for hosting, distributing, collecting sales and making payments to it's media suppliers.

These people always make it seem that Apple is ripping someone off?

Dont they realize that when they buy something in a store... that the store (depending on the location and product) is charging you from 15 to 60 %

Because Apple doesn't do any hosting, distribution, and collecting sales data is a sore point. Publishers want that. it does do purchasing but the publishers can handled that.
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post #33 of 148
Quote:
Originally Posted by k2director View Post

If I were the magazine industry, I would threaten to only support Android until Apple came up with a more reasonable fee.

That sounds like a great idea. Especially considering that the last time I checked, people weren't lined up for days trying to buy a Xoom or a Samsung whateveryoucallit, but yet Apple can't fill the shelves fast enough. You, sir, seem to have keen business sense.

As for Rolling Stone, they haven't had anything of value between their pages since the early 80's so who cares really.
post #34 of 148
Quote:
Originally Posted by magicj View Post

They offer a platform for people to sell things. I'm not aware of any "Publicity" they have other than "Staff Selections" and "New and Noteworthy".

Yes. That. That's worth lots of downloads.
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post #35 of 148
Change is hard to swallow for some people. This reminds me of the sea change that happened in the photo industry over the past 20 years. I used to work in the business and remember the comments that many traditional photo companies, including Kodak, had in the beginning regarding digital photography - things like, it's neat, but will never take over film. Or even better, "sure, digital photos are going to take over film the same way that Polaroid took over traditional film developing". They failed to realize that they should have embraced the coming change (even if they didn't believe it would happen the way it did) as an opportunity to do things differently/better/faster.

Some e-magazines have figured out that you can't just turn a print piece into an e-piece as you're missing a lot of value that the digital medium offers. For example, an article about a new band in Rolling Stone could/should offer a clip of a song from the band (or maybe a full "free" song download), maybe video clips from the interview (necessitating interviewers/writers to become more than just the person writing the words), live bio's of the band, up-to-date concert schedule, etc. Advertisers will, at some point, also understand that their ads can be more than just a link to their website and they will be worth paying more for them than what they pay for the print version.

I would agree that there may always be a need for the print version of mags, books, etc if for nothing else than the nostalgia of it. Kind of like how vinyl has a whole new group of followers today, even though they grew up with cd's and digital downloads.
post #36 of 148
Quote:
Originally Posted by asdasd View Post

Because Apple doesn't do any hosting, distribution, and collecting sales data is a sore point. Publishers want that. it does do purchasing but the publishers can handled that.

Oh really? Who exactly is hosting and distributing all the content in iTunes then?
post #37 of 148
Quote:
Originally Posted by ChiA View Post

Judging from the money developers are making from Android apps, 70% of something from the Apple app store is better than 90% of nothing from Android.

If I were the magazine industry, I would sell my subscriptions through my own app, so the customer's exposure to the Android marketplace was minimal (and I kept all the money). If the iPad had no magazine support, but another platform did, it would put the iPad at a disadvantage over the long-term.
post #38 of 148
Quote:
Originally Posted by Tomahawk View Post

Hmm,

30% doesn't sound so bad to me... Coming from the newspaper business I can think of the following expenses that are offset with the iPad.

Printing
Postage
Packaging
Retail markup

We don't really make money on subscriptions, we make money on advertisers. There also is an economy of scale difference here. If a newspaper/magazine grows their print costs still increase. They have to hire more staff for distribution, install or use larger presses, etc. What cost increases the more digital subscriptions they sell???

Yep.

Plus, when it comes to books, brick and mortar stores take 50%. Not to mention the middlemen.

30% is an absolute bargain. It amazes me how many people think 30% is somehow gouging. Not to mention, Apple is absorbing the merchant credit card fee, and handling customer service issues, and has delivery expenses (server farms aren't free).
post #39 of 148
Quote:
Originally Posted by magicj View Post

The nook (Android platform) currently has 20% of the electronic market. By this I mean they sell 20% of the electronic magazines and books, not that nook devices are 20% of iPad sales.

B&N's Nook Color does appear to have more success with magazine and newspaper sales than Apple's iPad according to this recent article.

http://www.poynter.org/latest-news/m...tions-on-nook/
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post #40 of 148
Quote:
Originally Posted by sticknick View Post

Oh really? Who exactly is hosting and distributing all the content in iTunes then?

Right?!
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