Financial Times believes changes coming to Newsstand, including a reduction in Apple’s cut
But little evidence is given to back up its claims, as the Newsstand remains a source of immense frustration for publishers who have seen their digital edition sales fall
The Financial Times late last week ran a story that claimed that Apple will be reducing the percentage it takes of in-app media sales, reducing their fee from 30 percent to 15 percent.
Normally TNM doesn’t discuss rumors from other media outlets, but any news coming from the NYT, WSJ or FT usually has a fair amount of truth in it. Apple’s PR plays favorites, and these media companies are “in”.
So, why would Apple cut its fee from 30 percent to 15 percent? Possibly because they are noticing that publishers have been thinking less Apple-first than they have been in the past. The Newsstand is a mess, and digital edition sales are falling. A cut in fee means little to Apple, but would mean a lot to publishers. Publishers have always said 30 percent was unfair, and probably have often brought it up to Apple CEO Tim Cook.
But the FT’s article, written by Tim Bradshaw and Shannon Bond, is pretty thin on detail, and otherwise sloppy. For instance, the authors say that improving “Apple’s terms would make its devices more attractive to content creators at a time when it faces a threat from Google.” Well, if Google is posing any threat to Apple in the area of digital media sales I’ve yet to see it. While publishers are upset at Apple for destroying the Newsstand, they don’t see Google doing much of anything to lure publishers or improve sales among Android device owners. (Most magazine publishers, when asked, say their sales from Google remain smal, and are irrelevant to their digital publishing strategy.)
The article also mentions that Apple is “discussing” improved fees with media companies. What is there to discuss?
(I can imagine the conversation: “do you want a larger share of in-app sales, Mr. Publisher?” “Yes, that would be nice.” “Are you sure?” “Yeah, we’re pretty sure making more money is better than less.” “OK, we’ll get back to you, maybe other publishers prefer to hand over more money to us, we wouldn’t want to upset other publishers who feel making less money is preferable.”)
It wouldn’t be a complete surprise if Apple finally did something with the Newsstand (one thing it might do is simply get rid of it). After all, it is hard to believe a company like Apple could let the Newsstand be unmaintained for so long – 18 months a counting.
But my own conversations with Apple, with the developer support team, and one cryptic email from the App Store team, have not been positive. Most of those involved were not even aware that the Newsstand was a disaster, as I have had to walk them through the App Store for them to see what a mess it is (I guess Apple staff are gamers and don’t use the Newsstand themselves).
Nonetheless, a change with the Newsstand would not be a complete surprise.** Though, that it might come today during the Keynote at WWDC would shock me. A pleasant shock, to be sure.
Finally, is it possible that both the NYT and FT are merely speculating or passing on one-sourced stories? If you recall, the NYT said last week that we shouldn’t expect a new Apple TV to be unveiled at WWDC because “it wasn’t ready.” But look at that WWDC logo being used this year? It screams “Apple TV” – surely Apple wouldn’t have done that merely to do a misdirection?
The world of tech reporting is very competitive, but that would be no reason for these two major papers to engage in the same sort of rumor-based reporting that tech sites often engage in. It is hard for me to see the editors of the NYT and FT letting such stories get through. But we’ll know very, very soon.
The live stream of the WWDC keynote will be available here.
** Re/code says the Newsstand will be killed off today at WWDC. They also say Apple will launch its own Flipboard-like product for publishers to support. They also reinforce the story that Apple will cut the fee down from 30 percent.