Apple has been in the news aggregation business for quite some time now, but never as committed as today. Earlier this year, the tech giant from Cupertino decided to double-down on their Apple News investment and grab a bigger piece of the digital publishing pie by launching a new subscription service called simply Apple News Plus. The main idea behind this new product is to bring together all sorts of digital publishers into a well-designed platform within the Apple News app.
Currently, as various sources online claim, the service has over 300 different well-known digital magazines and newspapers on their roster. Vogue, National Geographic Magazine, People, ELLE, The Wall Street Journal, Los Angeles Times are just some of the flashier ones.
The service was first released in the US and Canada, but it’s now also available in the UK, Central Europe, and Australia.
Why is Apple doing this? What’s in it for them?
There’s no point overcomplicating things. It’s simple. Money, of course.
Since Apple’s iPhone business is reportedly deflating, they’re looking to build new streams of revenue.
In addition to Apple News Plus and its already established Apple Music platform, the company has also decided to branch out into different markets. In 2019, along with Apple News Plus, the company created Apple TV Plus and Apple Arcade, a video on demand and a gaming subscription platform that also offers monthly subscription deals to people who are interested in consuming premium video and video gaming content.
As you can see, Apple is now laser-focused on cashing in on consumer subscription services across multiple industries.
So far, it’s been going quite well for the tech giant.
According to Tech Radar, in the first 48 hours since its launch, Apple News Plus managed to generate a subscriber base of 200,000 people. To quote the famous Anatoly Dyatlov from the masterful HBO mini-series “Chernobyl”:
For such an influential brand that has its finger in so many industry pies, this is not exactly something to brag about.
However, Apple continued to push their product and people have started to respond.
At the time of writing, the latest numbers suggest that Apple News Plus now has over 100 million subscribers. We’d be willing to bet that that figure is now over 120 million strong.
So, how does Apple News Plus work?
In a nutshell, Apple News Plus is a paid extension of Apple News that curates premium content from its publisher partner list to the platform’s subscribers.
Still confused? Put even more bluntly, readers who decide to pay for Apple News Plus get access to the content from their favorite magazines and publishers like People and WSJ that would otherwise be locked behind a paywall. Instead of paying for individual subscriptions to People and WSJ, readers get access to their content (plus content from other brands on Apple’s roster) for a single subscription fee to Apple News Plus.
For this particular service, Apple makes money from both sides: the reader and the publisher. Apple News Plus sets the reader $9.99 a month (it comes with a one-month free trial). However, the service also offers a family sharing deal with no extra charge, which means that up to six people can use be added to a single subscription deal.
Apart from paying less for premium content from multiple top-level publishers, Apple has also significantly improved overall experience of consuming written content. The whole presentation – from the photos, animated covers, to articles and dynamic contents pages – is quite impressive. It makes it so easy to read across multiple devices.
That said, for publishers, Apple News Plus is far more expensive. Sure, it gives them additional exposure to a new audience, but that comes with a serious price. They take a ridiculous 50% cut of all the revenue made from their subscriptions service, leaving the publishers in a situation where they will have to think long and hard about whether this deal is actually good for them.
Why is the relationship between publishers and tech giants so complex?
With this model, Apple has become another tech giant that’s putting their hands into the publishers’ pockets.
Ever since Facebook killed off the organic exposure of pages within the newsfeed and drastically reduced user exposure to the news stories, publishers have been struggling to find alternative ways to reclaim the traffic that’s been taken away from them.. That Facebook update came as a wake-up call for a lot of media professionals, who finally realized how dependent they are on referral traffic from social media websites.
For more than a year now, they’ve been trying to recover from the initial shock and reallocate their business somewhere else. Somewhere where they don’t have to spend a small fortune to get their content in front of their readers’ eyes.
This isn’t the first time Zuckerberg’s monopolistic tech behemoth turned its back on publishers who have invested a great deal of effort into making their presence visible on this social media channel. However, this time it really hurts. The pain felt here is like stepping barefoot on a LEGO spillage, lurking hitherto unseen on the carpet.
Publishers are now forced to think outside of the box and move their operations away from Facebook to other channels like Apple News Plus or Twitter, which they ignored and mocked for years. Believe it or, according to last year’s study conducted by BuzzFeed News, Twitter has already become the superior social traffic channel for publishers. So, who’s laughing – or chirping – now? Tweet, tweet.
However, once bitten, twice shy. Publishers are now wary of the danger that comes with going all-in on a single platform. They are looking to diversify their traffic sources and make up for Facebook’s shortfalls.
This is where Apple News Plus enters the picture.
Apart from robbing them of potential profits, why else can Apple News Plus be a potential problem for publishers?
Even though the tech giant’s new curated-news service seems important and interesting, as mentioned above, it’s not really that cheap. In fact, it’s not cheap at all. Giving away such a large cut of the profit seems unfair to most publishers. Especially because the readers won’t even visit their website to consume the content.
In order to get a bit more clarity on the subject, we asked Christopher Pramstaller, Audience Editor at Süddeutsche Zeitung, and Andreas Whörl, Data Analyst at Mittelbayerische Zeitung, for their overall impression about the release of Apple News Plus. Here’s what they had to say:
In terms of reaching new audiences and improving revenue – could this be a good opportunity for publishers? Or is the real winner only Apple?
Christopher: “Historically publishers have had two different roles. On the one hand, they create content in various forms, on the other hand, they distribute the mentioned content. The former gives them the opportunity to create a meaningful and consistent journalistic program that takes various aspects into consideration (i.e. public importance, popularity, civic duty, entertainment). The latter has an important part in financing the editorial staff.
It is, of course, an opportunity to use new distribution platforms, mostly created by tech giants, in order to reach new audiences. Yet there is a high risk of giving up a big part of one’s own reach and distribution network and also part of journalistic sovereignty.”
“When you are a part of a distribution network you give up part of your sovereignty. Some distributors have very strict community roles, some others make certain design choices impossible, some have restrictions regarding ads and yet others make you implement their own paying system. So besides the issue of reach there are certain losses you have to take into consideration.”
Andreas: “It will be difficult to step back once committed to Apple News. It’s a one-way street I believe and in the end, Apple will be the winner. Publishers will be in the same position as movie studios who have got less and less say and visibility compared to Netflix’s own productions. This could especially be a problem for national and global news or specialized (tech news) outlets. What if Apple decides it can deliver this news with their own editorial team after they’ve collected enough data on people‘s interests?”
Apple News Plus works on the same principles as Facebook’s instant articles. For instance, if you click on The Wall Street Journal’s article in Apple News Plus, you will be served with the entire text on the tech giant’s platform. Apple News Plus won’t redirect you to The Wall Street Journal’s website. If you want to expose readers to other stories on your website and try to get them to convert on some of your other advertisements on your domain, Apple News Plus won’t really help you with that. In fact, it will make it even more difficult to grab and retain readers.
So, what’s the final verdict?
With this kind of system, it feels like publishers are no longer in charge of the whole process. Tech giants such as Facebook, Google, and now Apple are taking center stage in the industry and dictating the margins. As you can see in this document, Apple has a similar stance to Facebook when it comes to ad revenue on their platform. Publishers get to keep 100% of the revenue from ads that are inserted into their content on the News Plus platform, and 70% of the iAds (Apple’s own advertising platform) Apple sells for them.
But possible financial cutbacks and lack of website traffic are only the tip of the iceberg. Think about it – if tech behemoths like Facebook, Google, and Apple take full control of news distribution, they are basically becoming the filter that decides what falls under the category of news, and what doesn’t.
As The Guardian points out, Apple’s curation-news system is run by actual people, not advanced algorithms. That’s sure to reassure some people – especially given the skepticism around processes which are too AI-dependent. That said, that’s a lot of power over a lot of information. What checks and balances are in place to assess the editorial gut and competency of these new, invisible kingmakers?
The issue is that readers appreciate the convenience of a one-stop-shop for news and information. It’s easy to share articles that appear on a personalized feed, and that’s easily chalked up as a win for these platforms because they’re ‘nurturing engagement’. Sharing is caring, right? But, it’s not doing much to create an environment where publishers themselves flourish. Apple et al are likely to do quite well out of such a set up, but individual purveyors of news? Not so much.
Giving such companies full control over the news is wrong and possibly quite dangerous. Think about it: public opinion is shaped by three companies, none of whom are publishing – and take great pains to emphasize they are not – is a scary thought, wouldn’t you agree?
Republished with kind permission of Content Insights, the next generation content analytics solution that translates complex editorial data into actionable insights.