iPad spending: Don’t sell me single app publications!

By Steve Outing

I’ve had an iPad for a couple weeks now (sharing with my wife and two daughters; it’s a popular gadget around our house). And I’m starting to notice some patterns in buying apps for the new tablet. I’d love to know if any of you share my behavior. (Comment below, please.)

  1. I don’t think much before purchasing a low-priced iPad app that is “permanent.” For instance, the Weather HD app looked cool, and even with its limited functionality (compared to the free Weather Channel Max for iPad app), I enjoy the quick look at the current weather and brief forecasts for the next few days and the app’s slick animated photo graphics. 99 cents? Sure, why not.
  2. Family members and I have purchased a few more expensive iPad apps: Scrabble ($9.99); Crosswords ($9.99); Pages ($9.99); Starwalk ($4.99, and highly recommended!); and some more low-priced ones: Magic Piano (99 cents); Glee ($2.99); Set ($2.99). Again, each of those apps is “permanent,” as in they will stay on the iPad until we tire of them.

Time iPad
Buy a digital edition of Time magazine
on your iPad! … For $4.99?

I’ve also downloaded a bunch of news apps, all of them free. Frankly, the news publishers that are giving away these apps are leaving money on the table. Of the apps that I downloaded for free to my iPad, I wouldn’t have blinked at paying 99 cents or $1.99 for those from: New York Times, NPR, USA Today, BBC News. I would pay for these because they are permanent.

Indeed, to not charge for the apps seems, well, crazy. If an iPad reader of any of those news brands doesn’t want to pay a couple bucks for their apps, then all he/she has to do is launch the iPad’s Safari browser and go to their websites, paying nothing. You can even bookmark, say, the NYTimes.com homepage and put an icon on the iPad screen permanently. The reason that someone like me would pay for an iPad news app from a specific news provider is if the experience is superior to viewing the news website on the iPad’s browser.

(At this early stage of iPad news apps, the websites as viewed on the iPad browser sometimes are as good of a or a better viewing experience than viewing the iPad app versions. NYTimes.com viewed on the iPad’s browser is quite nice, for example; in fact, it’s better than the only iPad app available from the New York Times currently, NYT Editors’ Choice.)

Within the news iPad apps I’ve used so far — and I’ll concede that it’s early, and publishers I hope will figure this out soon — the business model seems to be something that the companies will get to later. USA Today’s iPad app, for instance, has a banner ad on the homepage (Marriott Hotels at this writing), but ads don’t show up in much else. The NY Times iPhone app has ads from a single advertiser, at the bottom of the homepage (where banner blindness will make them mostly ineffective due to that positioning), and on the second screens of most news articles.

These apps are mostly “shovelware” from the news websites, and lack even web basics such as allowing user comments.

One nice ad technique used on the NY Times iPad app is an occasional “interstitial” full-page ad, which appears after you click a homepage or section-front headline and appears before you get to view your article. I don’t find this that annoying, but if I did, the Times would be smart to give me an option in the app to turn off such take-over-my-screen ads by clicking a setting and, say, paying a dollar to avoid seeing them for the next month,or maybe $5 to not see them for a year.

There are lots of ideas for “upsells” within an iPad news app to persuade (not demand!) people to pay extra beyond the initial, inexpensive download fee. Let’s say that USA Today’s iPad app had a setting where for $1 a month I could turn on a commenting feature and be allowed to leave comments on stories. This should be the topic of another blog post about how to make money from upsells in news iPad apps, so I’ll leave that for another time.

While major news brands are not taking advantage of obvious revenue opportunities with iPad apps yet, Time magazine, until this week, has been going about it wrong. Initially, an iPad user could purchase a single issue of a Time weekly edition, an enhanced digital edition of the print magazine, for $4.99 per edition. That’s compared to the street price of a printed Time magazine at $4.95.

It’s not just that the iPad single-edition price is a few cents more than the paper edition (which I think is ill-advised, considering the printing and physical distribution costs saved by Time with digital editions), but it’s also absurd that Time was selling each edition as a separate iPad app.

Getting back to my earlier comments, there’s no way that I’m going to pay for individual magazines as individual iPad apps! This approach completely misunderstands the device. First, the single-edition iPad purchase is fleeting; psychologically, I resist buying iPad apps that are read or viewed once and then deleted (since if I don’t and I continue buying iPad Time editions, my iPad screen will fill up with Time icons for various editions).

Time has now fixed this blunder and offers a Time iPad app for free. From within the app, the iPad user can purchase digital versions of the magazine for $4.99. Old issues are stored in the cloud for later reading, and there’s only one Time icon on the iPad screen. But pricing should be more realistic, I believe, and subscriptions offered. While I don’t think that this is the best iPad business model for Time, at least if its executives want to charge per digital issue, they should get a grasp on what’s likely to fly in digital-content pricing when there’s free content (like Time.com!) available on the iPad browser.

Count me as an iPad fan. I love the device, and more specifically I love the form factor of a tablet and can see it becoming an important part of my media life, taking much time away from my laptop. It does concern me that news publishers, out of the gate, appear to be missing the boat in working on an innovative business model for the tablet. Geez, I hope we’re not seeing the big news brands repeat the mistakes of their past when it came to adapting to new digital devices!

Author: Steve Outing Steve Outing is a Boulder, Colorado-based media futurist, digital-news innovator, consultant, journalist, and educator. ... Need assistance with media-company future strategy? Get in touch with Steve!