Media observers have already decided that Apple News+ is a terrible deal for legacy publishers. But some digitally native companies think the subscription service could be a useful way to test new paid products.
On Monday, amidst intrigue about which legacy publishers were in or out, Apple announced that several digital-native publishers, including Vox Media, Business Insider and theSkimm, were joining its service, which costs $9.99 per month.
Though they differ in most respects, all are in the early stages of trying to develop consumer revenues. Earlier this month, Vox Media CEO Jim Bankoff announced at SXSW that his company was going to be rolling out a number of membership products in the fall; theSkimm, which has been quietly expanding past its core newsletter product, now hopefully describes itself as a “membership company,” and has designs on growing a collection of products, such as a members-only app and calendar service. In addition, New York Media, which added three of its digital vertical brands to News+ in addition to its print magazine, launched a flexible paywall at the end of 2018.
So instead of having to worry about cannibalizing an already-vital business, this new crop can try out new ways of packaging content or product ideas, while collecting an easy stream of incremental revenue along the way.
“This is a grand experiment,” said Daniel Hallac, New York Media’s chief product officer. “The Apple audience is not the same as our web audience. Someone who will want to subscribe to us directly is different from someone who’s interested in the bundle.”
Many publishers, particularly those with developed subscription operations, saw a lot to dislike about the terms Apple was offering for News+, which costs $9.99 per month. Apple’s control of the customer relationship meant very little data would come back to the publisher, and the metric used to determine publisher payouts after Apple’s 50 percent cut is murky at best.
“Unconscionable is a word I’d use,” said Aron Pilhofer, the James B. Steele chair of journalism innovation at Temple University. “That Tim Cook says he cares about journalism and then takes that cut is ridiculous and tone-deaf.”
Yet the product offered the 300-odd titles some wiggle room. Not all of the publishers participating in News+ are required to put all of their content into it – The New Yorker, for example, is only putting its weekly print issues up every week; The Los Angeles Times, according to a spokesperson, is not including any content from its archives – and so the digital natives are each using News+ as a platform for experiments.
Vox, for example, will use Apple News+ to test a kind of windowing strategy, where the handful of pieces it publishes there every week, via a product called the Highlight, will be available exclusively on Apple News+ for a week before they are released widely.
theSkimm will produce a custom digest of content that will live on Apple News+ exclusively, and for an indefinite period, said Dheerja Kaur, theSkimm’s chief product officer.
New York Magazine’s digital verticals will treat each week as an opportunity to explore what a magazine version of their product might look like, said chief product officer Daniel Hallac. For The Cut, which has had a digital “cover story” for years — it debuts them on Instagram — that process is more developed than it will be for, say, Vulture.
Even The Wall Street Journal, whose participation in News+ surprised many observers, is treating Apple News as a distinct product in some ways. The Journal will reportedly hire 50 reporters to work on a “snackable” version of the paper that will appear in Apple News+. Katharine Bailey, the newly named general manager of the Journal’s Apple News+ operation, operates independently from Karl Wells, the gm of the Journal’s membership operations.
These experiments make sense because most of those publishers see content as being just one element of a direct relationship they’d like to have with their readers. Bankoff suggested that Vox Media’s membership tiers will involve more than content; Hallac said that New York’s membership will likely include events and community and other things beyond content as well. Being able to signal that the content they make is valuable, even as part of a bigger package, is useful.
That the digital native publishers can conduct these experiments without straying from a core strategy helps too. “I can completely understand why Vox is in it,” Pilhofer said. “For them, it’s all incremental revenue, it doesn’t cannibalize any existing subscription business. It’s the kind of content that I think people are going to want.”
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