July 22, 2014 Last Updated 7:51 am

Apple sees shift from content sales to app sales; good or bad news for digital publishers?

Morning Brief: While app sales are increasing, content sales are declining as consumers shift to streaming services; subscription service Next Issue updates its iOS app, adding background downloading

The tech site Mashable yesterday reported the results of a recent study from Jackdaw Research which shows that app sales are increasing through Apple’s iTunes, even as the average amount spent by iTunes user is decreasing. Apple reports its earnings on Thursday so we will see if the company is seeing a significant decline in iTunes revenue, but the trend right now is for lower sales.

The first inkling we had that digital music sales had hit a plateau occurred in January when Nielsen reported that sales dropped from 1.34 billion units in 2012 to 1.26 billion in 2013. The culprit was quickly identified as music streaming. Apple certainly saw the trend and launched its own iTunes Radio service. Then came news of the Beats Music acquisition.

While content sales may be declining due to streaming, app sales continue to increase. Some see this as a good sign for digital publishers but that might be shortsighted as one of the biggest trends in digital publishing is subscriptions services – whether in eBooks through Amazon or Oyster, for instance, or in magazines through Next Issue or other digital newsstand services.

One might say that their is a difference between a subscription service and a streaming service but it is hard to really see it from the perspective of a consumer – both deliver unlimited (except for the size of the service’s library) content at a set monthly price. Both music streaming and publishing subscription services make it easy for the consumer to access content without buying anything specific – but more importantly, this transaction occurs without direct content with the record label, publisher.

If publishing is moving in the same direction as the music industry, the sales trends are a warning to publishers that lower net sales are right around the corner.

NextIssue-iPhone5-lgNext Issue Media, the digital newsstand subscriptions service established by a group of major magazine publishers, last night released an update for its iOS app, now called <strong>Next Issue – unlimited access to more than 140 magazines.

The update adds background downloading of issues, a feature found on many other Newsstand apps. But their app description is interesting:

What’s New in Version 3.15.1
– Improved background downloading – if you’re downloading a magazine and your iPad falls asleep or you leave the app, we’ll continue to download the magazine for a few minutes per Apple’s rules.
– Note: if you want to download a series of magazines in a row, you’ll still need to keep the app open. We recommend setting your iPad Auto-Lock to “Never” and plugging it into a charge.

Condé Nast issues an update to its Epicurious Recipes & Shopping List app. The stand-alone app has added a seasonal fruits and vegetables notification feature:

Use your location to find out what vegetables and fruits are in-season near you with our new seasonal ingredient finder.

  • Nate 3 years ago

    One problem with your post is that apps, especially the ones you pay for, are arguably a type of content. So what Apple is seeing is money shifting from content to content.

    • D.B. Hebbard 3 years ago

      Apps being bought through the App Store may be content, but is hardly the kind of content publishers (that is, readers of TNM) care about.