The Internet is not SkyMall

Inevitable:

Many magazines that are available on the iPad, such as Esquire, People and The New Yorker, have not posted their digital single-issue sales to the ABC. But Vanity Fair sold 8,700 digital editions of its November issue, down from its average of about 10,500 for the August, September and October issues. Glamour sold 4,301 digital editions in September, but sales dropped 20 percent in October and then another 20 percent, to 2,775, in November. GQ’s November edition sold 11,000 times, which was its worst performance since April (when the iPad was released) and represents a slight decline from its average digital sales of 13,000 between May and October.

After Wired’s enormous debut month, the magazine averaged 31,000 digital sales between July and September, but even that fell in October and November, with sales coming in at 22,000 and 23,000, respectively. (For comparison, the magazine sold 130,000 total print editions for October and November.)

It costs $40/year for a New Yorker subscription (or $4/copy) on an iPad, comparable to a paper subscription. The New Yorker, Vanity Fair and other Conde Nast publication pages are full of complaints from subscribers about the quality and cost of the iPad versions of those magazines. After the novelty wears off, it makes no sense to pay four bucks for magazines that publish a good deal of their content on the Internet for free.

The magazine publishers’ fantasy that iPad users would be trapped in the digital equivalent of an airplane cabin, with the app store functioning like SkyMall, is the latest incarnation of a zombie dream that just won’t die. It’s been around since the dawn of dial-up services (remember Compuserve?) and it fails every single time.

(via)






40 replies
  1. 1
    cathyx says:

    They have some cool stuff in the SkyMall catalogs, ever hear of the winebra?

  2. 2
    Odie Hugh Manatee says:

    Compuserve? I was a customer of theirs back in the mid 80’s and into the early 90’s! I was even an online gamer with PlayNet in the 80’s!!

    Damn I’m old. Time to go kill some zombies in L4D2…lol!

  3. 3
    Dave says:

    It will only work one way – they will have to invest in their staff and create content that is just as desirable as what they have in print…but is only available online (as opposed to online and print) and for a fee.

    ESPN kind of has a version of this going with their ESPN Insider. But I don’t know how much penetration that has into their total visitor base or the revenue it generates.

  4. 4
    DougJ says:

    The New Yorker iPad editions are great, but four bucks is just too much. I want to support the New Yorker so I’d like to have an iPad subscription, but I’m not spending four bucks a pop.

    For me, the answer is to let my hard-copy subscription lapse for now and not buy any of the fucking thing til they have a decent price for the digital version.

  5. 5
    Zifnab says:

    The magazine publishers’ fantasy that iPad users would be trapped in the digital equivalent of an airplane cabin, with the app store functioning like SkyMall, is the latest incarnation of a zombie dream that just won’t die. It’s been around since the dawn of dial-up services (remember Compuserve?) and it fails every single time.

    Newspapers save a bundle by publishing online rather than printing ink to paper. Some free market libertarian idealists might wonder why these cost savings are not then passed on to the consumer?

    Who on earth is going to spend $4 on an electronic copy when you can get the paper version for a buck? These Galtian Geniuses have truly jumped off into the deep end if they think consumers can’t do the most rudimentary math.

  6. 6
    dand says:

    Same thing with books. I love the Nook but am PO’d when I see a book for half the price of what I pay for an electronic copy. I have no problem with just compensation but this is the same as when the CD and DVD came out. Publication costs dropped dramatically but the consumer price went up. And there is no competition, the Kindle copy will cost the same to the penny. I have not figures out why I would subscribe to any publication at the costs listed.

  7. 7
    Efroh says:

    I dropped my hard copy subscription to the New Yorker in favor of the Kindle subscription (which is cheaper than either the hard copy or iPad subscription at about $36 for the year). I also dropped my Kindle New York Times subscription which was $13.99 a month when they raised it to the $20/month price of the iPad version (which is better than the Kindle version). If the Washington Post raises the price of their Kindle subscription to the same price of the iPad version, I will also drop it.

    Moral of the story: don’t overprice your digital goods. If you price them appropriately, you will actually sell to people like me, who are aware that much of the content is free, but who want to support the organization delivering the content. If you set the price higher than “tip” level, I’ll go for free every time.

  8. 8
    Walker says:

    @Odie Hugh Manatee:

    Compuserve? I was a customer of theirs back in the mid 80’s and into the early 90’s! I was even an online gamer with PlayNet in the 80’s!!

    Were you a Kesmai player? Those were the days. My students love it when their “old” professor tells them of the days when MMO meant 50 or so people on at a time.

  9. 9
    Pococurante says:

    I don’t understand the dig on Compuserve: 1969-2009, that is pretty much the entire history of the individual internet.

    You must be thinking of Prodigy.

    But Compuserve? Email and chat starting in 1979, subscription services that lasted two decades. The primary non-propietary way for small businesses to do credit card transactions for those same two decades. It was the launching point for my first internet startup in 1994.

    And of course it was insanely popular before the Great Unwashed Masses (like my parents and younger siblings) swarmed AOL.

    Ah Gemstone II/III… my first introduction to near-bankruptcy. Thankfully it went flat-rate before my bank account did the same.

  10. 10
    different church-lady says:

    Doesn’t the New Yorker publish about 40 issues a year?

    McArdle much?

  11. 11
    different church-lady says:

    UPDATE: Well, there, all I gotta do is read the link — 47 issues a year, $40 a year for the PRINT version, $5 for a single iPad edition (the same as the cover price of the print edition), for a total of… oh screw it, a hell of a lot more than 40 bucks.

    The math is off, the point stands. Sounds painfully like McArdle, doesn’t it?

  12. 12
    azlib says:

    Part of the pricing issue is a virtual magazine or book just does not seem as substantial as a paper copy which you can hold. The mere physicality of paper is a factor in our perception of value. On the Internet the price of information tends towards zero, since the information is presented as just pixels on a screen.

    I do not think publishers have really come to grips with this fact and think they can fit an old publishing model into an electronic framework. In the end the old model is just not very appealing repackaged in an electronic format.

  13. 13
    PeakVT says:

    @dand:Amazon’s pricing structure for Kindle books strikes me as bizarre. Look at Cadillac Desert for instance. Kindle – $16.99. Used paperback – from $4 ($0.01 + s&h) (which means there’s not much point in unloading my copy). It’s a great book, but it’s also 24 years old and there are always more than enough used copies for sale that the price as close as it can get to zero. Why is the Kindle edition so expensive?

  14. 14
    numbskull says:

    @Zifnab:Among other things, I’m in the publishing industry, publishing serious stuff (text, images, movies, sound) online for 16+ years; a long, long time in this arena. We rank in the top 5 of our field of over 40 direct competitors and in the top 13% for all journals, whether print, online, or both.

    Overall the savings are not really there. Yes there are savings in some specific areas (no ink, no paper, no physical manipulation), but other costs, many associated specifically with the digital medium, pretty much kill those savings.

    Ironical, ain’t it?

  15. 15
    Walker says:

    @PeakVT:

    First of all, there is no way a publisher is going to compete with the used book market. The question is how the price compares to the currently printing paperback (which Amazon lists around $12).

    Honestly, I find an electronic edition to be worth more to me than a paperback. I simply do not have any more room on my bookshelves for more physical books. If I just wanted to read of it and then disposing it, sure I will grab a physical copy that has resale. But with electronic annotations and search, if it is something that I want to hold on to, e-Books are looking like a better value.

    Part of the problem is that people mistakenly believe that e-Books should be cheaper because the cost less to produce. However, if you follow the publisher blogs, you know that printing is a miniscule part of the cost of making a book; they are struggling with how to adapt to this mistaken impression.

  16. 16
    different church-lady says:

    @PeakVT: I’m not usually given to conspiracy theory level stuff, but I am of the gut-level opinion that the push for electronic versions of everything is to ensure that 15 years from now there’s no such thing as a used paperback that can be purchased secondhand.

  17. 17
    MikeJ says:

    @Efroh: I read the NYT on my android pad. I fire up calibre on any mac, linux, or windows box, it grabs the feeds and converts html to epub. I go to my web server and pick up all my morning reads.

  18. 18
    Zifnab says:

    @numbskull:

    Overall the savings are not really there. Yes there are savings in some specific areas (no ink, no paper, no physical manipulation), but other costs, many associated specifically with the digital medium, pretty much kill those savings.

    I’m sorry, but I’m not entirely buying it. Yes, digital expenses will replace hard costs. But distribution costs practically go away. The cost of printing one issue or ten thousand is virtually negligible.

    I’m sure all the Photoshop licenses aren’t cheap and the talent always costs money. And maybe if all those costs were more transparent, I could have a better idea of the true cost savings of going digital. But a lot of that technology cost is upfront. You’re converting expenses into investments, variable costs into fixed costs, and adding a lot of stability to the business model.

    And your competition (often yourselves) puts out the same media for free. Guys like the New Yorker should be trying to scale up their readership, not jack up their prices.

  19. 19
    Zifnab says:

    @different church-lady: Meh. I think digitization will just push more and more content into the public domain. Between piracy, free-waring, and copy write expiration, you’re going to see a lot of the old books and movies available for free via big public archives.

    I think there is something like 400,000 free books available for the typical e-Reader already. Anything you buy is going to have some kind of value-add (cliff’s notes, audio, etc).

  20. 20
    PeakVT says:

    @Walker: I don’t disagree with that, but with an older book most of the upfront costs have long ago been recouped. For a new or recent book I would expect Kindle prices to be similar to the hardback or trade price. But not for something a lot older.

  21. 21
    MikeJ says:

    @Zifnab: When’s the last time copyright expired on anything in the US? Do you think congress will allow anything else to ever pass into the public domain or will they just pass the Sonny Bono Act mark II? And III. And IV.

  22. 22
    different church-lady says:

    @Zifnab: I suppose that’s fine as long as you think everything we want to read, see, or hear has already been created.

    In the meantime the actual artists and creators working today aren’t going to pay for themselves.

    I think this veers uncomfortably close to the whole “everything ought to be free” mindset that net piracy has created. People get outraged about paying 15 bucks* for a CD they can download for free, and the musicians wonder how the hell they’re going to make a living.

    (*Think about that for a second — freakin’ USB cables cost that much in some places…)

  23. 23
    JimF says:

    A big part of a digital distribution costs in DRM. It costs a publisher a non-trivial amount to add and maintain DRM on a book.

    If you want to price the eBook the same as a hardcover version you have to add value. For instance Baen Books lets you buy Advance Reader Copies (eARCs) 2-6 months before publications, but they charge you $15 for that service. If you wait until 1 month before publication the price is $6 for individual novels or $15 for the months worth of publications.

  24. 24
    Pococurante says:

    It takes seconds to strip Kindle DRM. I’m not getting dragged into the debate, suffice to say I will keep unencumbered versions of digital content I’ve purchased. And I feel very good about “finding” soft copy of books I’ve already bought in hard copy.

    Calibre has been an excellent tool (well worth the $50 I donated to the author) for me to keep multiple protocol versions in a single library and auto-publish to my various e-readers.

    (a) I buy content not media, and (b) I don’t want to be tied to a specific reader. Amazon and iTunes have made a lot of money off me.

  25. 25
    NeenerNeener says:

    @PeakVT: When the iPad came out last spring Steve Jobs cut a deal with five of the biggest publishing houses (excluding Random House) to let them price and sell their own ebooks in the iBooks app. Bezos objected to that model and those five publishing houses yanked their ebook catalogs from Amazon until Bezos eventually caved and let them do the same at Amazon. The Barnes & Noble, Sony and Borders/Kobo ebook stores had to follow suit.

    When you look at an ebook at Amazon look for a disclaimer under the price that says the book is priced by the publisher; Amazon has no control over the price of that book. I’ve read that those contracts are all up for renegotiation this spring; until then…I’ve got a library card (or two) and I’m not afraid to use it!

  26. 26
    kc says:

    I just can’t see myself settling into a hot bubble bath with a Kindle.

  27. 27
    Mnemosyne says:

    @Walker:

    The question is how the price compares to the currently printing paperback (which Amazon lists around $12).

    That’s generally the metric I go by, but it bugs me when the electronic version of something that’s in mass market paperback for $7 is still being sold for $15.

    My price point is usually $9.99 or under. Anything over $9.99, I don’t buy. It seems like a reasonable price to me that still allows everyone to get paid.

  28. 28
    Pococurante says:

    @NeenerNeener: We hear from quite a few authors that Amazon does indeed not only decide book price but has been increasingly leveraging-up their margin. Once the publisher, agent etc get their skim there is not much left for the author.

    The long-standing problem for content creators has always been the middlemen. But that is the price for promotion. Faust explains it better.

    Content creators would be better off these days self publishing, *then* negotiating promotion of the published product.

  29. 29
    Pococurante says:

    @kc: I settle in a hot bath with my Kindle all the time. Yeah it would suck if I dropped it. But it is the proto-release so it would give me an excuse to upgrade. :)

  30. 30
    NeenerNeener says:

    @Pococurante: If those authors work with one of the “Agency 5” publishers then the publishers are blowing sunshine… Amazon/B&N/Sony/Borders have had no control over the price of those ebooks since last May.

    For any author not working with the “Agency 5″… I wouldn’t be a bit surprised if Bezos is screwing them over.

  31. 31
    burnspbesq says:

    I know what I’m paying for when I move a magazine subscription from paper to iPad, or buy an ebook rather than a hard copy: convenience (and less paper to deal with). And I’m willing to pay for it.

    I will admit that it is hard to summon up too much sympathy for media enterprises that created their own free-rider problem by making content available for free. But that free-rider problem is real and substantial; there aren’t enough people like Efroh out there (I do the same thing for Harpers and TNR; it’s analogous to contributing to public radio).

  32. 32
    mm says:

    I have over 100 books on my original model Kindle. I own the dead tree versions of about a dozen. Some I bought because I like to reread things. Some I bought because I was reading the physical book and didn’t want to carry it out of the house. I love the search function.

    I have home delivery of the New York Times. This allows me access to the website and the historical search. Also I can use their reader to read the last week or so’s paper.

    I tried subscribing to magazines and newspapers on the Kindle, but the illustrations are worthless. Some don’t include them (this goes for books too). Some just aren’t clear enough with my 4 levels of gray. The new Kindles are much better, but not up to the iPad in quality. But I can read it in bright light.

    Ideally, I’d like a deal where if I subscribe to a magazine (like I do to The New Yorker. Harpers, The Atlantic) or to a newspaper (New York Times) I can read it on the iPad or Kindle at a deeply discounted price or for free since I’m already paying for the content and the marginal cost of one more subscription is $0.

    Same thing with a book I’ve bought from Amazon. I’d like a deal to get the Kindle version along with it.

    And yeah, I started with CompuServe in 1982 or 1983 and kept it for almost 20 years. The UPI newsfeed and Washington Post newsfeed was great. The technical forums were very valuable. I even bought things on the mall when it opened up. Didn’t do much with the email because I didn’t know many people on the system. MCI Mail however was great, though expensive.

  33. 33

    Most publishers are pricing their digital (iPad) editions like single copy print editions. The reasons are two-fold: they don’t want to give 30% of a discounted subscription to Apple, and they currently see their digital editions as the equivalent of the magazines sold at an airport magazine stand — you’ll get people who simply want something to read on their flight.

    Right now, most publishers don’t see their iPad editions as a replacement for print. As a result, the best, and most affordable digital magazines, will come from new players, not the old guard.

    But this will change over the next year or two as the iPad continues to grow in sales and new tablets come on the market, many running Android. Print sales will continue to decline and publishers will have to begin visualizing a world where digital is king and print products are a novelty.

  34. 34
    different church-lady says:

    @mm:

    I tried subscribing to magazines and newspapers on the Kindle, but the illustrations are worthless. Some don’t include them (this goes for books too). Some just aren’t clear enough with my 4 levels of gray. The new Kindles are much better, but not up to the iPad in quality. But I can read it in bright light.

    Since we’re talking about the New Yorker, I’ll note that the illustrations are maybe… 30%? of the reason to get the NY’er. They’re one of the only magazines left that still elevate illustration to the great art it can be.

  35. 35
    bdbd says:

    My son and I have spent many gleeful hours on airplanes thumbing through (and thumbing our noses at) issues of SkyMall, truly the Onion of the catalog world.

  36. 36
    numbskull says:

    @Zifnab:

    And your competition (often yourselves) puts out the same media for free. Guys like the New Yorker should be trying to scale up their readership, not jack up their prices.

    Actually, we ARE the competition that “puts out the same content media for free.” :)

    Thus, I agree with much of what you’re saying. But…

    Over the decades, I’ve been involved in online-only, in print-only, and in print-that-moved-to-online journals and publishers. I agree that it just doesn’t seem right that the costs are there, but they are. In my limited experience, there’s a lot of hidden costs in publishing but the big cost difference between the old print world and the new(ish) digital world is compensation. Good publishing skills were never cheap, good digital skills were never cheap, but good digital publishing skills are really expensive.

    Now, most traditional publishers assumed, as you do, that going digital would be great for their personal bank accounts. They figured that they would just keep charging what they had been charging, but reap more profits by slashing production and delivery costs. Or worse, they figured that the digital output would be a whole new and additional revenue stream. And, to a degree, they have profited. But, the cost savings wasn’t what they expected, and they’re finding that the new (to them) medium comes with its own pitfalls…

    …Like small start-ups that challenge them with bizarre business models that “steal” their market share.

    BTW, I think a lot of what you cite as upfront costs are actually ongoing.

  37. 37
    Quaker in a Basement says:

    Compuserve? Bah!

    Prodigy, bitchez!

  38. 38
    jheartney says:

    @Quaker in a Basement:

    I (no longer) dream of GEnie. And AOL was my blank floppy disk supplier for years.

  39. 39

    […] is why I was a little surprised to see (via Balloon Juice and Atrios) that basically no one is subscribing to the electronic editions of magazines like the […]

  40. 40
    bemused senior says:

    I read ebooks on my Android phone using fbreader. I also use my XO-1 (which has long battery life and an excellent tablet mode) as an ebook reader. I keep my on-line library in calibre. I do not buy drm protected ebooks, but I do buy ebooks available in open formats. Baen Books is an excellent publisher of SF books, and has both free content (older books) as well as current books for paperback-like prices (as well as ARC pre-releases as described above.) As others have said, I feel electronic books are more valuable to me than paper books, since I can carry a copy of my entire library in my phone and read in bed without a light not bothering my spouse. But I do not want books that can be revoked as Amazon has done in the case of Kindle content, and I want a public format that can be transferred to newer technology in the future.

Trackbacks & Pingbacks

  1. […] is why I was a little surprised to see (via Balloon Juice and Atrios) that basically no one is subscribing to the electronic editions of magazines like the […]

Comments are closed.