Tuesday, August 24, 2010

Short takes: iPad case keyboard; replica editions and Google ads; building a case for mobile & tablet advertising

This was a nice catch by AppleInsider:
Since Bluetooth keyboards must broadcast their presence in order to be recognized, the devices must file with the FCC. This is where new devices often get discovered for the first time. One such device is a good looking iPad case with built in Bluetooth keyboard.

You can read more here.

Speaking of AppleInsider: the site often breaks interesting news about Apple and their mobile products, which is why I link to it. In comparison, MacRumors grabs news from elsewhere, then prevents others from adding to the information or linking to their own sites that contain any additional news.

I ran afoul of MacRumors a few months ago when I linked back to TNM a few times with reviews of media apps. One of the moderators over there then proceeded to ban me -- a first! I suppose this should be a badge of honor -- that guy was definitely evil, probably a newer member of the team because my own experience over there were mostly positive. In any case, my advice would be bookmark AppleInsider and leave MacRumors to the Tea Party crown running the place.

paidContent spoke to the CEO co-founder of Exact Editions yesterday and reported on his views about Google Ads his company's flipbook editions.

According to the story, Adam Hodgkin, the co-founder of Exact Editions, says that publishers should charge for digital subscriptions rather than go with an ad model.

“But it would be fair to say that our experience is that magazines that charge will make much more from selling digital subs than they will from running ads in the margin of ‘open’ pages. Like two or three orders of magnitude more," Hodgkin is quoted in the story.

Well, rarely have I heard a better argument against replica editions. What the CEO has said ehre is that these kinds of products do not engage the reader and therefore, can not drive response to advertising. Thank you.

But I don't think this is exactly what Hodgkin was saying. After all, what is the business model of these replica edition makers? Cheap and easy Flash (and increasingly HTML5) editions, sold to publishers who are not very enthusiastic about electronic publishing to begin with, don't believe in the long term success changes of e-publishing, and don't want their ad sales teams wasting time selling low cost ads.
Here is a little exercise for you to do: open up your iPad (if you don't own an iPad you can stop here -- but then again, why are you reading TNM?) and look at the advertising in the People magazine iPad app edition. Now I have to say that I do not read People, ever. But look at those ads, see the ways the reader can interact with them, respond to them. Now compare that to either a Google ad or an ad in a replica edition of a magazine. If you are lucky the replica edition ad will have a live link in it -- most do not -- that at least will put it on a level playing field with the Google ad.

But there is no real comparison. The iPad will be better both for branding and for direct response. I have no data to back up that claim, so you can disagree all you want. But once tablets get more traction we'll start seeing a ton of data on ad response levels -- maybe not from Apple, but certainly from the agencies buying space.

[Edited to properly identify Adam Hodgkin's relationship to Exact Editions.]

The problem of advertising within mobile media products for small consumer and B2B publishers is a serious issue. What pricing models really work when readership is initially zero and then grows over time.

But this issue is no different from what happened when the web first beckoned many publishers. It is almost gospel that it was a mistake to give away web ads early on as it lowered the value of Internet advertising long term.

But that is not the way I remember it -- I was there in the trenches. The way I remember it is that agencies demanded the advertising be part of print ad schedules as 'added-value". The choice, then was to go out and hard sell the web advertising, risking your print schedules, or else give in to the agencies.

So why did we end up giving in? Because in the end we knew that in order to actually sell the true value of the web we needed to know what that value was. And we didn't.

We didn't know because, of the most part, those put in charge of the web were there for reasons quite separate from their abilities to manage the web -- often politics, connections, nepotism, you name it.

Sadly, at many publishing companies the electronic publishing side of the business still lacks professionalism and an honest-to-goodness dedicated team. But past practice aside, publishers need to understand that building an advertising model for mobile and tablet products will require transparent reporting, level-headed expectations, and honesty.

That is why the whole question of tablets or mobile media "saving" newspapers or magazines is totally absurd. Right now we don't even know if many of these products can break even. Most of us involved believe that they can, in fact, be very profitable. But one needs to build the models first and then implement them in a professional manner. Taking the easy way out, say through creating replica editions is no way to test out the platforms.


Adam Hodgkin said...

Hi Douglas, Some corrections called for. I am not CEO of Exact Editions and Paid Content didnt say that I was. Where did that come from? Second you suggest that Exact Editions is one of those platforms that offer 'cheap and easy Flash or HTML5 editions to publishers'. Which of course we dont -- perhaps you should take a closer look. When you do, you will see that all Exact Editions magazines can run on the iPad using our viewer Exactly (they wouldnt do that if they were Flash, and you wouldnt need an app if they were HTML5, and I think you know that). But precisely because we think (like you) that ads in magazines and the magazines themselves, should be fully engaging, they are bursting with interactivity including direct response to ads. Please take a more discriminating look at what is going on! Including the crucial importance to publishers of having their own magazine directly in iTunes as a branded item. The point about the low value of 'in margin' advertising with Google text ads came from a completely different thread about the potential for in-margin text ads in ebooks -- BTW.

Douglas Hebbard said...

Adam Hodgkin mentions that he is identified as the CEO of Exact Editions and asks "where did that come from?"

I admit that I have no idea, and the story will be corrected.

Concerning his statement that I suggest that Exact Editions is one of the companies that offers "cheap and easy" replica editions: this I didn't say, though I did say that this was the business model of the "replica edition makers". If Exact Editions offers expensive and difficult replica editions I will not debate the point.

The fact is that vendors that sell replica editions to media firms for publishing on websites or the iPad generally tout their ease of conversion and their inexpensiveness. They do this because these flipbooks rarely generate much revenue and end up being another expense line.

I know this because for many years I was pitched these products.

Anyone who reads TNM knows that I am no fan of replica editions generally. The difference is that I am willing to say it and it generates much feedback from the vendors of these products.

For me, posting a flipbook of a print magazine on a website is the equivalent of broadcasting a radio station on the television -- it can be done, there may be some value in it, but in the end it has nothing to do with television, and as a business it is a dead end.

As to his final point: I, too, agree that it is important for publishers to have a branded presence in iTunes -- I have screamed it from the first day this site launched. Where we disagree is to the solution being proposed.

Looking inside iTunes to see the iPad user reaction to these replica editions reveals that tablet owners are not enthusiastic about them -- to say the least. As one user said of one of these magazines "Doesn't really grasp the point of the iPad really..." Exactly.

Adam Hodgkin said...

Hi Douglas, Thanks for the correction. I will leave it for you and your readers to consider whether cheap and misleading rhetoric adds value in this discussion: of course I did NOT say that Exact Editions produces expensive and difficult solutions (your third para of comments is either/both discourteous or silly to suggest that I did). Going back to the original blog. One further issue in your posting surprised me. You say:
"... once tablets get more traction we'll start seeing a ton of data on ad response levels -- maybe not from Apple, but certainly from the agencies buying space."

I wonder how you know this? My sense is that Apple will control the flow of data from app usage very tightly and that some but not very much of the most valuable identifying data will be made available directly to advertisers, disintermediating both publishers and advertising agencies. This is the aspect of the Apple technology and licensing approach which most concerns magazine publishers (and ad agencies). In my view, the magazine publishers are more likely to influence Apple in a more open direction than the agencies (which will go along with the iAds stats and demographics). But even publishers as big as Time Warner and Conde Nast are having difficulty shifting Apple on its privacy position. Of course, we could all be wrong. Which is something to bear in mind!