Hearst Magazines is launching an “App Lab” at its New York offices, which, according to paidContent, will act as an an incubator space for the company’s marketers and ad agency workers before being opened up to customers to promote Hearst’s iPhone, iPad and tablet products.
The publisher offers 22 apps so far and has all of its magazines available as digital replicas through the e-edition service Zinio says the report.
Specialist magazine group Imagine Publishing – which produces titles including Retro Gamer, X360 and Advanced Photoshop magazine – has made its entire magazine portfolio available for Apple iPhone, iPod Touch and iPad users.
It’s no surprise given the publisher’s commitment to creating digital edions, its range of online-only titles and the digital focus of many magazines that it’s decided to launch paid-for apps across these platforms.
But interestingly these applications, developed by technology company PixelMags, while creating digital editions of the titles rather than an iPhone or iPad-specific version, will feature embedded video clips.
What’s more, digital magazine subscriptions created by PixelMag are certified by the Audit Bureau of Circulations electronic, so the apps will potentially count towards Imagine’s circulation figures.
ITV management had better hope Ben Bradshaw’s deeds are as good as his words, because its faith in an another revenue-generating scheme looks misplaced.
Bradshaw, the recently appointed Culture Secretary, told the Financial Times earlier this week that the BBC’s refusal to relinquish licence fee money to aid other broadcasters with a public service remit was ‘wrong-headed’. He said the corporation’s hierarchy would have to come to its senses sooner or later.
While the BBC fights the good fight against ‘ideological’ forces such as these, part of the network gave airtime to a would-be recipient of top-slicing: ITV’s executive chairman, Michael Grade.
On BBC Five Live last Thursday, Simon Mayo asked Grade about the YouTube Susan Boyle affair (some 200 million video views to date).
After describing YouTube’s proposed revenue-share for the Boyle clips as ‘derisory’, Grade insisted ITV wouldn’t get caught out again:
“We are working on it and watch this space, but we’re all going to crack it, either when the advertising market recovers or a combination of advertising and micropayments which is 50p a time or 25p a time to watch it.
“We may move in time, in the medium term, to micropayments, the same way you pay for stuff on your mobile phone. I think we can make that work extremely well.”
(You can listen to the interview on the iPlayer until midnight Wednesday 15 July. Grade interviews starts around 1 hour, 22 minutes.)
Despite Grade’s confidence there are grave doubts that paying per clip is going to work. Here are four reasons to worry:
1. Micropayments don’t work for perishable goods
It’s an argument that has been made against charging for news stories, but it is equally applicable when you are talking about clips from a reality TV programme.
Quality drama may have a shelf-life and an audience willing to pay for it, but a water cooler moment from reality TV? Not likely.
The Susan Boyle phenomenon still feels vaguely current, but it is a passing fad.
If you’re unconvinced take this quick, highly unscientific test: would you pay 50p to watch the machinations of ‘Nasty’ Nick Bateman from the first series of Big Brother?
The correct answer: who’s ‘Nasty’ Nick Bateman?
2. Micropayments put people off
Writing back in 1996, social scientist Nick Szabo introduced the idea of mental transaction costs. He argued that no matter how small the payment, it still incurs effort on behalf of the potential buyer to work out if he or she is getting a good deal.
He wrote:
“The reason we don’t do the things is that they’re not worth the brain cycles: we have reached the mental accounting barrier.”
And that in a nutshell is why micropayments are doomed to failure.
It’s a theme Chris Anderson touched on in his recently released book ‘Free: The Future of a Radical Price‘. He wrote:
“It’s the worst of both worlds – the mental tax of a larger price without the commensurate cash. (Szabo was right: Micropayments have largerly failed to take off.)”
Unsurprisingly, Anderson advocates free as a preferable alternative to micro, but he’s not alone. New York professor Clay Shirky is with him.
In fact Shirky has been saying much the same thing since the beginning of the decade and his 2003 essay ‘Fame vs Fortune: Micropayments and Free Content‘ has become something of a set text.
3. Micropayments only work if you control distribution
ITV’s Grade rightly cites mobile phones as a great platform for micropayments.
The network operator controls what is available via the handset, limiting availability and ensuring prices won’t be undercut.
Further, the operator offers a simple and largely pain-free way of paying for goods by adding the cost to a monthly bill or subtracting it from a top-up on a pay-as-you-go phone.
But the web is different – it’s anarchic, open, a free-for-all.
Nobody controls distribution and despite efforts to chase down copyright abusers, there will always be someone ready to undercut your micropayment with an even smaller charge – free.
Opponents of this reading cite Apple’s iTunes Music Store as proof that micropayments can work on the net. But, as Shirky argued earlier this year, the fee-per-track model works because this is a rare example where no alternative exists.
“Everything from Napster to online radio has been crippled or killed by fiat; small payments survive in the absence of a market for other legal options.”
Further, Apple does control part of the distribution, successfully creating a market for the must-have iPod.
So despite Grade’s assertion, it’s unlikely any micropayment system on the internet will turn out ‘the same way you pay for stuff on mobile phones’.
Incidentally, it will be worth watching to see how the smartphone redefines this divide between the largely ordered phone network and the web.
4. YouTube clips drive traffic first, revenues second
If you think about a clip on YouTube as a direct money maker, you’ve got your priorities wrong.
It’s about reach, exposure and promotion. It’s about creating a buzz and driving traffic back to the core.
Did the Susan Boyle clip achieve this? No question.
For starters, video views at ITV.com were up 528 per cent year-on-year and advertising slots for the duration of the ‘Britain’s Got Talent’ season sold out.
Meanwhile, such was the interest around the show, the final was seen by 19.2 million people – ITV’s highest audience since England vs. Sweden in the 2006 World Cup. More eyeballs this year promises high advertising yields next.
In short YouTube kept its part of the bargain.
Would all that have happened had ITV charged 25p a clip? Would 200 million people have checked it out? Will a pay-per-clip Britain’s Got Talent be a winner?
The twist in the tale is that Grade, who steps down as executive chairman at the end of the year, won’t be around to find out.
Jon Bernstein is former multimedia editor of Channel 4 News. This is part of a series of regular columns for Journalism.co.uk. You can read his personal blog at this link.
Ninety minute podcast featuring four prominent speakers on the subject of using Twitter in journalism. Download it to your iPod and listen to it on the train! Full story…
Peter Mandelson had to be a last minute addition to the list because the magazine had already gone to press: being offline seems to be a recurring theme for the London Evening Standard’s 1000 most influential Londoners list, out this evening.
Can we get an online version? Can we heck! After time wasted going round the editorial houses through the Evening Standard switchboard, Brighton-based Journalism.co.uk is getting sent a print version.
So in the meantime (till the print copy arrives) here’s the online media and general media types we’ve spotted on the list of 50 that are featured on the website. And it looks like new media gets a fairly good representation.
The little ‘see new media’ under the names almost had us thinking we could click on links… no chance. Well, we’re not in London; we don’t really exist, clearly.
Shiny Media’s three founders are included – and quoted as being “highly influential in the UK online world”. They aren’t among the very top 50, but you can see a scanned in bit of the list on the Shiny blog.
Media/Online types from the top 50:
Outside of the big 50 we’ll have to rely on the Guardian’s Media Monkey for information:
“…chief exec James Murdoch, Ashley Highfield, chief exec of the Kangaroo on-demand TV project and, drum roll please, Evening Standard owner Lord Rothermere, chairman of DMGT! Who’d have thunk that thisislondon.co.uk was such a groundbreaker?
Other media bods on the list were Paul Darce, Rebecca Wade, Ed Richards, Mark Thompson, Simon Cowell, Simon Fuller, Nick Ferrari, Emily Bell, Eric Huggers, Evan Davies, John Humphrys, Jay Hunt, Peter Horrocks, Alexandra Shulman and Gok Wan.”
It was all a bit kids in a sweetshop at yesterday’s AOP Digital Publishing Summit, if we forget all the problems with wifi, of course.
The main aim, for most attendees, In all likelihood, was to talk to all the people they know in online life, but rarely get the chance to talk to in person – over coffee (and odd looking cake/pastries) and lunch during the day, and drinks in the evening.
The programme ranged from panels to energetic speakers with a broad range of digital publishing topics covered – though perhaps not as much new discussion was initiated as some participants hoped, despite Peter Bale from Microsoft attempt to get some answers from YouTube’s Jonathan Gillespie.
A few additional highlights to add to our coverage so far:
Emily’s Bell’s vision for Guardian’s international reach: In the panel introducing ‘the digital pioneers,’ Bell, director of digital content for Guardian News & Media, said the group sees now as a ‘uniquely’ timed opportunity for the brand to expand internationally – and to do so before their rivals do.
Speaking to Journalism.co.uk afterwards, Bell elaborated on her example of the Economist’s well-established grasp of the international market. Although it happened for the Economist over a 20-year period, she told me that a similar endeavour in 2008 is ‘compressed’ by the web.
Bell also pointed out during the panel that the Chinese words for ‘crisis’ and ‘opportunity’ are one and the same (I tried to keep that in mind as my laptop charger physically broke and the wifi went down).
The Guardian’s move stateside was also referred to by Saul Klein, partner of Index Ventures and moderator of later panel ‘Growing in the Digital World’.
Quoting Simon Waldman, Guardian Media Group’s director of digital strategy and development (and Emily Bell’s boss), Klein said the Guardian’s acquisition of ContentNext was ‘well set up to exploit’. Waldman explained how moves like that prepared the group for a US audience.
The ‘Unlocking the mobile internet’ panel: In the spirit of the thing, TechCrunch’s Mike Butcher gave out his mobile number for questions before probing the panel on their respective views on mobile internet’s future.
Is 2009 the year of mobile? Melissa Goodwin, controller of mobile at ITV says not: “I don’t think it’s next year, I’m hoping it’s 2010.”
“We just want to give you anything you may want,” she said of ITV’s mobile strategy, though she admitted that building advertising revenue was very much an ongoing issue.
Goodwin also revealed that consumers can look forward to Friends Reunited on two iPhone applications in the first part of next year, as reported in more depth over at PaidContent.
Stefano Maruzzi, president of CondeNet International, on outlining Conde’s digital development: As reported over at MediaGuardian and PaidContent, CondeNet, the online arm of Conde Nast, has got lots of ideas about lots of things:
The simple answer is no. It looks like a piece of medical equipment. I don’t want to be sitting on the bus with everyone thinking I’m some kind of techy hypochondriac constantly monitoring my vital signs.
Apart from its general ugliness, I’m a little at odds with this type of technology. I can see the logic of an electronic reader for news (but why would you not want to use your mobile phone to get info on the hoof?) but for books? Why?
Books are simple technology that work perfectly. I doubt I’d want to take this speak and spell lookalike to the beach and I certainly wouldn’t use it to get my commuting news. An iPod moment for news, it is not.
Against all of which I’m completely staggered that this thing is selling like hot cakes. Fortunately for my schadenfreude gene the reviews aren’t too good. Next device please.
[youtube:http://www.youtube.com/watch?v=PBCzIDbRJvs]