Mobile readership offers publishers new circulation revenue sources
Media businesses have already gone through a first wave of digital transition, and in the last few years, mobile has been the next frontier. Publishers have been tasked with deciding whether to offer their content on the smaller-screen devices—and how.
This year will be a seminal one, marking the first time 100% of publishers will format their content for mobile, according to an Alliance for Audited Media survey of 210 media companies in North America. The development points to both digital’s essential role in media companies’ future profits and the importance of mobile to consumers’ daily media lives.
The survey found in October that mobile did not play a huge role in media companies’ circulation revenues, but many expected that to change by 2014, when over four out of 10 anticipated making at least 10% of their circulation revenues—excluding ad dollars—from mobile.
One reason is the proliferation of mobile platforms available to publishers who increasingly see standalone smart device subscriptions, or higher-priced subscriptions for digital and mobile access, as major revenue sources. Many are offering special platform-specific content to maximize the potential of smartphones and tablets and make the subscriptions more valuable to readers.
Publishers increasingly see the iPad, and tablets in general, as offering some of the most dynamic opportunities for media consumption. Correspondingly, the iPad saw the greatest percentage of publishers charging for content across publication categories. The Kindle and NOOK saw the second- and third-highest percentage of consumer magazines charging for mobile content. For newspapers and business publications, the iPhone ranked above these two non-Apple devices, an indication that Apple remains a primary device-maker for media consumers.
Similarly, the iPhone and iPad were the No. 1 devices for which publishers developed mobile apps. Mobile apps are important to media companies across all devices, however. Over half of publishers reported having mobile apps for every major smart mobile device.
Publishers are also optimistic about their ability to scale smartphone and tablet apps to profitability fast. While, as of the survey, only 22% of publishers were profitable on apps, over half expected to be by the end of 2014. By comparison, websites were already profitable for 51% of publishers, with less room for growth.
To achieve profitability on mobile and desktop, and seeing that digital ad sales have not been enough to stanch print losses, a fast-increasing percentage of publishers are moving to some form of paywall. Four out of 10 media companies reported already using a paywall, with the highest percentage choosing a metered option.
Media companies have known for a while that their readerships’ transition to digital was inevitable. Publishers reported that already nearly one-quarter of their readership was exclusively digital. Now magazines and newspapers are wising to the mobile-first, and maybe even mobile-only, next phase of media consumption.
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