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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

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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