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Media Biz Counts on Tablet Users to Pay Up

Most still don’t want to pay for their mobile news

December 13, 2012 | Advertising & Marketing | Media Buying | Mobile

The fast uptake of tablets engendered by the release of the first iPad several years ago sent the media world buzzing. With such a sleek new interface, publishers hoped that they might soon recoup losses seen by print newspapers and magazines.

Such a development has not exactly materialized. eMarketer estimates spending on digital magazine ads will reach $3.14 billion this year, helping the magazine industry as a whole increase ad revenues by 2.6%. For newspapers, the picture is worse: $3.4 billion in digital ad revenues this year will not stanch print losses, and overall ad revenues will drop by a further 5.9% in 2012.

But ad support is not the only business model out there, and many magazines and newspapers have embraced a paid-content approach when it comes to tablet apps. Strategic planning firm McPheters & Company found in November that 62% of magazine tablet apps worldwide and 59% of newspaper tablet apps relied on a paid model. Overall, six in 10 media-related tablet apps were paid.

Media-Related Tablet Apps Worldwide that Have a Paid Content Model, by Type, 2012 (% of total)

Typically, those apps make a media subscription significantly more expensive than the print version, though electronic versions of magazines and newspapers might offer extra features and content not available in a traditional newspaper or magazine.

Average per-Issue and Subscription Prices of Media-Related Tablet Apps Worldwide, 2012 (% difference vs. print prices)

But consumers still indicate a reluctance to pay for such apps. Nearly two-thirds of tablet owners and 59% of smartphone owners surveyed in the US by Mojiva in September said they would not pay even to access their “favorite” mobile news source. In contrast, one-quarter of smartphone owners already had such a subscription and 15% of tablet owners did.

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Check out today’s other articles, “Update Overload Remains Brands' Biggest Social Danger” and “Mobile Leads the Gaming Charge in South Korea.”



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