Saving the Magazine Industry: Here's What Happens Next

Posted by: Josh Quittner on: October 2, 2009

• In: apps | digital magazine | E-reader | magazine consortium | mysterious apple things | paid content | tablet
• 7 Comments

Peter Kafka had a good piece today, as did Nat Ives at Ad Age yesterday, on industry efforts to create an open consortium among magazine and other print publishers. The idea, according to Kafka and Ives, is to create a unified storefront for content, which would help publishers maintain control of their businesses as we enter the era of the third screen.

Kafka raised a number of questions, which I’d like to bloviate about, since they strike at the heart of the future of the magazine business.

# They’ll have to convince consumers that already have billing relationships with Amazon, Apple and other vendors to sign up with yet another service.

The tension here is on the device side. If the device is cool—as in iPhone cool—we know that people will be only too happy to augment the functionality of the device with great content. And they will pay for it. They’re paying for the new CNN app. They’re paying for the People Magazine Celebrity Tracker. They’re paying for the McSweeney’s app. They’re paying for books and comic books and all kinds of things.

Getting people to pay isn’t hard if the content is worth buying. Magazine companies already have billing relationships with their customers. It should be pretty easy to extend that to new devices. And it’s not as if consumers are reluctant to set up one-button authorization accounts these days.

#They’ll have to convince device makers to play along with the strategy, which runs counter to many of their own plans. Both Amazon and Apple, for instance, have intentionally created closed systems that give them control of both devices and distribution.

While this may indeed be the case with Amazon, I don’t believe it’s at all true of Apple these days. And as for new entrants on the device side, I think OEMs are desperate for content partnerships. It’s in no one’s interests to create a situation where, say, you could only get The New Yorker and other Conde titles on the HP tablet but if you want Sports Illustrated or Time Inc. titles, you need to have the Dell tablet.

Apple has already opened up the App Store and is distributing free apps that point the user to third-parties, which handle the transactions and fulfillment. Indeed, the Amazon Kindle app was among the first that did this on the iPhone; now, you can even subscribe to Rhapsody’s music service via a free iPhone app. It’s obviously in Apple’s interests to encourage this, both from a regulatory perspective, and because it makes good business sense for them to have happy, engaged partners making kick-ass content for their device(s).

As for Amazon, I have given up trying to understand their game. By disintermediating the publishers, they run the risk of marginalizing themselves. This can’t be their strategy—Jeff Bezos is way too smart for that. So I assume something else is in the works.

They’ll have to create content that consumers will want to buy. The new product can’t simply be a digital version of the magazines they’re already printing: That’s already available on the Web, and consumers have shown almost no interest in paying for it, and advertisers haven’t fully embraced it either.

This is the only real real challenge, in my opinion. (It’s also the one I’ve been working on for some months!) We’re trying to skip the awkward period of the mid 1990s when magazines and newspapers were dragged online and were merely crappy HTML replicas. But actually building new kinds of magazines that really surprise and delight users is going to take time. Luckily, we have time—the first real inflection point will be when Apple’s new Magic Device appears, and that could be next June.

Don’t overestimate the importance of the right device. With no imagination at all, we can envision a 10-inch iPod Touch, which would render beautifully packaged magazine-style content in a far more reader-friendly way than the Web. Even the “lean-back” experience of the Kindle, as primitive as it is, is far more conducive to long-form reading than trying to read on a desktop or laptop. I mean, it’s not coincidental that the killer app on the Web is the browser. The Web is built for browsing—not deep reading. Everything about reading on the Web is designed to shorten your attention span. Every link promises that whatever you’re currently reading isn’t nearly as interesting as the thing behind the link. Not that there’s anything wrong with that for some things. But it can’t possible work for everything.