Apple News- Advertising Revenue VS. User Attrition, Is Apple News+ the Antidote to the Media or the Poison?
Apple News, In one of the few highlights of Apple’s Fall Event, the company unveiled the Apple One subscription bundle, which packs Apple Music, Apple TV+, Apple News+ and many other services to customers. Apple News+ was launched in March last year. The thought-provoking thing is Apple News+ can take advantage of this “team fight” to break the bottleneck of development?
In fact, back in 2015.Apple launched a free aggregator of Apple News. Four years later, it launched a paid version named Apple News+. Apple News has 125 million users, including subscribers to Apple News+, the company revealed during its latest earnings call. According to the company’s results last November the Apple News+ user growth was slower than expected. In addition, the creation of Apple News+ has drawn a lot of criticism from the News media.
Apple News+ has introduced a number of new initiatives this year. These include the roll out of audio versions, local news services and the extension of free trial periods. Apple News+ has received mixed reviews in the media. The thought-provoking thing is how valuable is Apple News+ to the media? Can it win users long-term subscriptions?
To Provide a Survival Opportunity for Local Media
In terms of layout design, Apple News+ carries on what the tech company has always done: Clean, Simple, Easy for Users to Browse, it can be adapted to various sizes of electronic equipment, and clearly show the brand of the publisher.
As a digital news aggregation platform. Two of the Apple News+ biggest attractions to the News media on board are: Help the latter. One is to attract more users, and the other is to generate more revenue through subscriptions or advertising. The income distribution plan signed by Apple News+ and the media is as follows: Users pay $9.90 a month for a subscription, Apple Inc. takes 50 percent of that, the other 50% is allocated based on how much time readers spend on content provided by each media company. For the big media companies that have built their own paywalls, they already have a sizable number of paying subscribers, it would be difficult to accept such a high percentage. But for local media, Apple News+ could give them a new lease of life.
For now, America’s local news media are still struggling. A recent study found that, nearly a fifth of American local newspapers have disappeared in the past 15 years. This discovery proves that these local newspapers need the new users from the Apple News+, Especially, the young group which their platform is not easy to reach. Apple News has a huge user base: This app is built into every iPhone, iPad and Mac device. About 85 million users a month. Local media want a piece of the action, and thus a breathing space.
Support the Use of Third – Party Advertising Media Revenue
One of the comparative advantages of Apple News+ is that it supports the use of third-party advertising by media to increase revenue. In 2017, Apple announced a number of changes to Apple News+, This includes support for third-party advertising in new versions of iOS and Apple News services. But that is only if third-party advertisers are approved by Apple, and the ads are subject to strict rules. In Apple News, Apple created two new types of AD space: 300 by 250 and 728 by 90. In this way, the media can more easily port existing ads to the Apple News client.
In addition, advertisers have a high degree of trust based on the Apple platform. Therefore, they prefer to place their ads on Apple News+, this phenomenon has certain appeal for the media to enter.
After Apple acquired Texture- “The Netflix of Magazines,” people began to wonder if the tech platform would launch its own paid magazine platform. Now that guess has come true, Apple News+ began working with the magazine on exclusive features, interviews, illustrations, and interactive feature designs. In addition, in July, UK TV and film website Digital Spy launched their first Digital magazine exclusively on Apple News+. However, what has left the media wondering is whether Apple News+ really knows what it wants. Working with a TV brand that had never published a magazine in its history, and provide an “enhanced Experience” magazine. It doesn’t seem to be attracting media subscribers. This directly led to the magazine was discontinued after a few issues.
Media “Chilling” Default Items with Bundled Sales
After partnering with Digital Spy few weeks, Apple News+ is back in the headlines. Because Apple has set the default in iOS14 which is its upcoming operating system. As long as a user clicks on a story, it will only come from a partner media outlet of Apple News+. If the user is also a registered user of Apple News+, the user will open Apple News+ software by default.
Apple’s approach not only reduces the revenue that news publishers earn on their sites, but it also makes it impossible for most web analytics tools to observe readers. Apple is actually drawing the readers into its own walled garden. So that the media worried that they would extend this approach to a wider range of news products.
However, from the user’s point of view, this seems acceptable. After all, if a reader has paid to subscribe to Apple News+ and able to find a link to a participating media in Google search, that means they can read directly via Apple News+ without having to fight the media paywall.
But from the perspective of the media, the media is in a disguised way cultivating subscribers for Apple News+, and the readers who should patronize their own website have been cut off.
Australian media development consultant Corinne Podger said: “for those who consider joining media news aggregation platform, this could stifle their enthusiasm. In today’s media is facing huge pressure on profit margins. The regulator is considering force other big technology companies to increase financial support to the media, such a move is indeed disturbing.”
Peter Houston, Co-host of The Voice of The Media, commented: “The problem is that whenever Apple News+ work with other platforms, the media always seem to get hurt. They lose the brand, the data, and the opportunity to build relationships with readers.”
Houston says Apple News+ is still on the edge: “Apple News + is an add-on to music, TV and games, probably because Apple News+ doesn’t have core content. In fact, the Apple News+ is directly competing with media subscriptions ——That’s why the New York Times left. Bundles only work when the right price is in place. However, the right price is much lower than Apple expected. As usual, this is going to squeeze media revenues because Apple’s market share is not good.”
This is the crux. The bundle is a great value to consumers and will undoubtedly increase Apple’s revenue from services. But media content is being squeezed here as an added value, and they get little in return.
Accordingly, the tech giant’s foray into paid news may not look promising. Even if bundling is enough to attract a new wave of subscribers, there won’t be enough money to go back to the media to make it worthwhile. As a result, the media won’t work with Apple News +.
Reposition and Be Sincere
There is no need to lose faith in pay-for-news aggregators, which are not without their successes. For example, take PressReader, a Canadian company. It was founded for twenty years and dubbed “The Netflix of the Press,” This platform has more than 7,000 newspapers and magazines in more than 60 languages for £27.49 a month. As of May 2019, they had more than 12 million monthly active users. For every book a user reads on this platform，they pay the relevant media, as if someone had bought the book. PressReader is profitable, even though it pays the press fairly.
Here’s another example, just a few weeks ago, The European streaming platform Cafeyn acquired Blendle, creating a joint news service that serves more than 1.5 million active users across Europe. At the time of the acquisition, Blendle had about 50,000 users and was paying $10 a month.
Their success lies in their focus on layout, each article has text and mobile optimized reading options, which allows the reader to read a newspaper or magazine consistently from begin to end. More importantly, they sincerely cooperate with media companies to seek win-win results.
In short, if Apple News+ wants to win the trust of the News media, it may need to show real sincerity and rethink the positioning of the platform in the future.