Apple is talking to big newspapers about joining its subscription service
Apple is talking to big newspapers about joining its
subscription service
Last March, Apple bought Texture, a digital magazine
service. Now it wants the New York Times, the Washington Post and the Wall
Street Journal to join up.
By Peter Kafka Sep
7, 2018, 5:04pm EDT
Earlier this year, Apple got into the magazine business
by buying a digital magazine distributor. Now it wants to add daily news to the
mix.
Apple has been talking to some of the biggest newspapers
in the U.S. about adding their stories to Texture, the magazine app Apple
bought in March. Apple executives, led by content boss Eddy Cue, have reached
out to the New York Times, the Wall Street Journal and the Washington Post
about joining the app, according to people familiar with the conversations,
which began this summer.
The discussions are happening as Apple ramps up its
interest in content sales and subscription. It is putting at least $1 billion
into a slate of TV shows it expects to start showing next year, and many people
believe Apple would like to market a supersized subscription offering that
bundles music, video and news together.
An Apple rep declined to comment.
Texture — often described as a Netflix or Hulu for
magazines — currently lets consumers read as many stories as they want from
dozens of magazines for a $10 monthly subscription. It’s unclear whether Apple
executives want to add stories from the three dailies into the same
subscription service or market the papers as an add-on.
But no matter how Apple structures the proposal, it may
be a hard sell for any of the papers, which already have big subscription
businesses of their own and would be concerned about cannibalizing their own
sales.
The Washington Post sells a basic all-digital subscription
for $10 a month; the Times sells its for $15 a month, and the Journal’s base
price is $37 a month. Texture pays its content providers — prior to Apple’s
acquisition this spring, it had been owned by a consortium of publishers,
including Conde Nast and Hearst — based on the usage their titles generate. So
a newspaper that joined Texture would almost certainly see a much smaller
payout from a Texture subscriber than one who signed up directly with one of
the papers.
An additional worry for the papers, says one executive
familiar with the conversations, is that being part of a bundle of publications
is less attractive than a one-to-one relationship with subscribers. It also
leaves open the possibility that Apple could drop them from the bundle down the
road.
The flip side: Apple has a huge base of users — the
company said its users had 1.3 billion active devices this past January — and
could dramatically increase the papers’ reach. For comparison, the Times,
fueled in part by interest in news following Donald Trump’s election in 2016,
has 2.9 million digital subscribers.
Another point in Apple’s favor: It has demonstrated its
ability to turn its hardware customers into digital subscribers. Its Apple
Music service, which launched in 2015 to lukewarm reviews, has since acquired
50 million subscribers by offering free three-month trials to all iPhone users.
And one more: Apple has gone out of its way to position
itself as a booster for news organizations — in part as a counterpoint to
Facebook, which has frustrated many news publishers by changing its approach to
news distribution multiple times. “We are committed to quality journalism,” Cue
said in a press release announcing the Texture acquisition.
The Post and the Journal already sell subscriptions via
Apple News, Apple’s built-in news distribution app. And all three papers
distribute at least some of their stories via the app.
Earlier this summer, Apple hired Liz Schimel, a former
Conde Nast and Comcast executive, as its “head of news business.”
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