The notion of a digital newsstand is nothing new, but 2018 has seen a revival of the concept following several large shots in the arm, as publishers and platforms continue to seek new ways to engage users and monetise their products.
What you need to know
In February, the online library Scribd announced that subscribers could access “an unlimited number of books and audiobooks, alongside unlimited access to news, magazines, documents, and sheet music.” The service had previously added magazines to its portfolio in late 2016 and newspapers in May 2017.
Citing Scribd’s co-founder and CEO Trip Adler, Publisher’s Weekly notes that Scribd has more than 700,000 paying subscribers, and that it generated over $50 million in revenue last year. With subscriber numbers growing at 50% a year, Scribd also reports to be profitable.
Then earlier this month, this sense of digital deja vu (Scribd had previously adopted a similar approach, prior to a 2016 pivot to metered service model) was compounded when Apple announced it was buying Texture, an online subscription service which allows subscribers unlimited access to more than 200 magazine titles.
The move took many industry watchers by surprise, given Apple’s slightly chequered past with these types of virtual (or digital) newsstands. Its previous magazine platform shuttered in 2015 when the tech giant rolled out Apple News.
Profitability and scale have arguably enabled Scribd to turn back the clock. For membership of $8.99 a month, subscribers can access more than half a million books, as well as content from outlets such as Time Magazine, Esquire, Men’s Health, Bloomberg Businessweek, Harper’s Bazaar and New York Magazine.
A similar cadre of magazine publications can also be found on outlet such as Texture. For $9.99 a month, users can access a selection of specialist – and mainstream – publications, ranging from Vogue and Vanity Fair to Glamour, Golf Tips, Wire and Runner’s World.
Apple’s previous attempts in this space irked some publishers, but their 2018 re-entry into this space is driven by a number of strategic considerations.
Firstly, this is arguably a deliberate response to Facebook’s decision to recalibrate its news feed to prioritise content from friends and family, not publishers. As Recode put it, this is “a message from Apple to big publishers: We like you.”
Secondly, the move also highlights Apple’s aspirations for their Apple News product.
Launched initially in the United States, Australia and United Kingdom in 2015, the service has grown quickly. As Eddy Cue, Apple’s senior vice president of Internet Software and Services, told an audience at South by Southwest
“Look, today, for some of the publishers that we have, including some very large ones like CNN, we already account for 60 to 70 percent of the articles read across the web and other services. We’ve become a pretty decent-sized player in a short amount of time around it. We also started where our customers that were reading were following about four publishers in Apple News a year ago… Today, they follow more than 20.”
For that growth to continue, Apple News clearly needs access to more great content, hence Apple’s overtures to the publishing industry by saying:
“We are committed to quality journalism from trusted sources and allowing magazines to keep producing beautifully designed and engaging stories for users.”
Examples of titles available on Texture
The bigger picture
These initiatives come at an interesting time for publishers and the wider media industry.
Growing subscription levels at Netflix, Spotify and the “Trump-bump” witnessed at the New York Times, Atlantic and others, demonstrates that (some) audiences are willing to pay for content, especially if price levels are competitive.
As a result, and often in a bid to double-down on super-users, we’re seeing growing numbers of publishers and content producers introducing new paywalls (like The Atlantic), reducing the amount of content they offer for free (like the New York Times) or removing content all together from third party platforms, as they look to launch their own paid for services (like Disney and Netflix).
Yet, at the same time as these efforts to grow subscriptions, we’re also witnessing the return of the “Netflix for News / Netflix for Magazines” super-aggregators; digital newsstands which offer a one-stop shop for consumers.
Will they cannibalise each other? Can they live together in digital harmony?
It’s too early to tell. But, I’ve argued elsewhere that all of these efforts to grow subscriptions may mean we hit peak-paywall in 2018. After all, audiences only have so much money to spend on content. And large numbers of them are reticent, if not to say downright resistant, to the very notion of paying for any media.
Whether consumers decide to go direct to the publisher – or if, instead, they go to third party platforms – could have a profound impact on your financial bottom line.
What this means for you
Against this uncertain, and fast changing backdrop, here are 10 questions publishers – and content owners – need to be asking:
- What’s the revenue share model? Does it offer sufficient monies to publishers?
- Does distribution on third party platforms – like Scribd or Texture – risk cannibalizing more profitable revenue streams for media companies (such as direct subscriptions, app and in-app purchases, paid for downloads etc.)?
- Should you keep your content exclusive to one or two newsstands, or should you be everywhere?
- Can newsstand owners reassure their content partners that they will protect copyright and prevent piracy?
- Are their geographical rights implications to your work? How can this be safeguarded when many of these platforms are global?
- How do you stand out from the crowd? A platform like Magzter, which launched in 2011, for example, contains titles from over 4,000 publishers and more than 10,000+ magazines.
- Are there cost implications for uploading – and possibly having to convert – your content into a format which can be distributed on these platforms? Will you have to do this multiple times, in multiple formats, for different distribution channels?
- What can you do if the digital distributor changes the functionality of their platform, especially if you feel that’s detrimental to your product? (A criticism previously levelled at later iterations of Apple’s newsstand.)
- Is the newsstand brand you’re signing up for well enough known to reach a critical mass? If not, how do they plan to grow it?
- In a climate where we are seeing consumers faced with growing numbers of paywalls and other media subscription services (HBO Go, Amazon Prime et al.) is there a limit to how much audiences will spend each month? If there is, what will audiences swap out / churn off from to pay for (hopefully!) the newsstand or subscription service you’re on?
In the digital era, it’s clear that we need new models to pay for content. As a result, it will be important to see if new iterations of services from Scribd and Apple News can pique the interest of both consumers and content producers alike.
History hasn’t previously judged digital newsstands especially favorably, whether these new incarnations can change that perception, we will just have to wait and see.