Friday, January 27, 2012

The evolution of the mobile app: Southwest adds important new features to its iPhone app

Sometimes one forgets that third party mobile apps basically didn't exist on any mass scale until Apple opened up the iPhone to apps in 2008, one year after the phone's introduction. Until then, the only way new apps appeared on your iPhone was when Apple issued an OS update and included something new.

Some of the most useful apps created are the ones we don't use every day, apps for travel, for instance. All the big airlines have had their own branded apps for a while now. This morning, for instance, I downloaded the iPhone app from Aegean Airlines, it will come in handy this summer (don't get jealous!).

In many ways the evolution of the mobile app in business reminds me very much of the evolution of the web. At first only a few companies built their own websites, and often companies partnered with media companies to be included in their offerings.

That was the premise behind much of the sales pitch from VerticalNet: the B2B web pioneer, and flame out, originally pitched mini sites to customers who could showcase their products on a VerticalNet industry website. The seemed to make sense for a while – what an easy way for a company to get some sort of web presence – but the idea made less sense when companies realized that they really needed to build their own websites, not rely on some company they had never heard of.

Today Southwest Airlines issued an update to its existing iPhone app that adds in many familiar features available to web users: early check-in, flight status notifications, etc. It is a natural evolution for the app, one that travelers will certainly appreciate. Some of these features are merely minor variations on existing services. For instance, airlines have allowed their customers to register for notifications of flight delays for a while now. Typically, once you have signed up for the service, you get a phone call whenever you flight has been delayed. Getting a notification on your iPhone is the same concept, but possibly more convenient.

But it is important to remember that it took a decade for companies to start to use their websites in this way, the evolution of their mobile apps is happening much faster.

That brings me to media apps: they seem to be evolving at a much slower pace. The reason for this, I believe, is two-fold: first, at many companies, the mobile and tablet initiatives are being managed by the editorial departments, leaving out sales and other departments from the process; and second, the outsourcing of apps means that their creation and updating are handled as projects – once completed the relationship is all but over until a new project is initiated.

For a newspaper or magazine, most publishers or editors have seen the purpose of a mobile app as furthering the reach of the editorial content. That's nice, but it is very limiting. Few newspapers, for instance, have their own classified advertising apps, or have created retail shopping apps.

In those cases where a publication has created secondary apps, such as Food & Wine's Eat and Drink, or DEPARTURES Ultimate City Guides, both from American Express Publishing, the products are still really just extensions of the editorial content.

The second thing that holds back mobile app evolution for media companies is the way they have looked at anything digital for the past decade. Web design is often outsourced so that any minor changes become a major headache. Imagine if every time an editor wanted a new looking editorial page for their magazine they had to call in a company and initiate a new contract. That is they way many magazine websites are handled today. This model has been adopted for mobile and tablet publishing, as well.

Thursday, January 26, 2012

Time Inc. accomplishes goal of creating tablet editions for all 21 U.S. titles; using Woodwing as partner

Although they have no new app to promote, Woodwing passed along a press release reminding everyone that Time Inc. has fulfilled its promise to bring all 21 of its U.S. titles to the iPad (as well as Android, Kindle, etc.). I think it is certainly worth taking note of the accomplishment.

All the apps have been in the Apple App Store for awhile now, with FORTUNE Magazine's app being the latest to get an update (very minor).

“With the availability of our entire portfolio of U.S. titles, we put ourselves in a great position to take advantage of these opportunities," said Mitch Klaif, CIO of Time Inc. "We also use WoodWing's solutions to help us produce our print editions, and WoodWing´s Digital Publishing Solution enables us to integrate our tablet publishing activities into our existing workflows. Working with WoodWing to make Time Inc. the number one publisher of digital magazines has been a great experience.”

“We would like to congratulate Time Inc. on this important milestone. At the same time, being able to bring such a large number of titles to various tablet platforms in such a short time frame is proof that our solution is perfectly capable of dealing with today’s publisher demands,” said Erik Schut, President of WoodWing Software.

OK, it is a lot of PR talk, but let's give credit where credit is due – they committed to creating iPad editions and have succeeded in that effort.

What Time Inc. hasn't accomplished, however, is coming to terms with Apple. All their apps remain outside of Newsstand, and they do continue to not offer digital subscriptions. As a result, the iPad editions prove to be a great addition for existing print subscribers, as well as a great way to access single issues for that long plane ride. But it is not a good way to subscribe.

Taking FORTUNE, for instance, a reader can go online and sign up for a 20-issue subscription for only $19.99. Like many publishers, they are taking a loss in order to maintain their circulation levels. I would think that getting 30 percent less than this for the digital edition, but saving the production costs would be worth it – but that is their position for now.

These editions are using Adobe's solutions, or course, as well as Woodwing Software Enterprise. Reader comments inside the App Store continue to be positive as a result, bearing in mind the occasional bug complaint. But Time Inc. continues to issue frequent app updates to address any of these issues as they arise.

Baltimore Magazine gets updated tablet edition, but no icon; app requires that the reader register to subscribe

One wonders how some apps make it through Apple's approval process. While apps have been unfairly rejected, others get in without app icons, and with a subscription process that stretches the App Store rules.
Baltimore Magazine, published by Rosebud Entertainment, has had their iPad updated this morning. You can find it pretty easily in the App Store, it is the app without an icon.

The app is listed under Thumb Media Group, a company currently owned by National Publisher Services, Inc. and Fry Communications, Inc., and not the publisher. This is probably just as well as I wouldn't want my name on this app either.

The free app opens to the library page where readers can buy individual issues, log into their print accounts, or sign up for a subscription. The problem is that the subscription price is not listed – instead a registration form appears that one has to fill out before you can buy a subscription. Some might be led to believe that all one needs to do is register and they will be a subscriber. No, upon completing the form one is then told a subscription is $9.99 for a year (the annual subscription price is clearly explained in the app description, though).

If one chooses not to subscribe there is no way to get back that registration information, of course – one feels like they have just had their pockets picked.

Oops, something is missing on your app, like an icon?

The issues download fairly quickly, but takes a long time to be processed, for some reason. Once you have your issue what you get is a typical replica edition – a PDF-like duplicate of the magazine that is not very enjoyable to read.

The app does have a text feature: if you tap a story up pops a text-only version of the article, making the app more like a Kindle Edition (sans any graphics) rather than a true tablet edition.

It is hard to understand why the publisher would have signed up for this. Their January issue looks pretty damn successful with tons of ads at the front of the magazine – so many that the Publisher's Note doesn't appear until page 28. So why let some vendor do this to your magazine?

But things get worse. Start reading the issue and a banner ad pops up on every page: Medical Malpractice Attorney! The ad even appears on top of full page ads! Yes, and even the cover! Lovely.

There is a button that allows you to close the ad, but it reappears after a few pages.

I've always said that publishers were the easiest people to sell to, they are as gullible as they come. This certainly proves it.
Left: the subscription page makes you register, before presenting you with the annual subscription price; Middle: a banner ad on top of a full-page ad; Right: replica editions remain difficult to read, being designed for print not tablets.

Wednesday, January 25, 2012

Forecasting the growth of digital: declines in print won't adversely effect every publisher, but it will kill off some

For many publishing company the migration of ad dollars to digital continues to make their executives lose sleep – even the ones that are still doing relatively well.

The reason for this is that the conversation at many industry conferences is about general trends. And the general trend shows that print is in decline, while digital continues to grow.

But the problem with general trends is that, well, they are rather general.

I see two problems with current analysis being done in this area: 1) the assumption is that a decline in print will effect all publishers equally, and 2) that "digital" is a format, when it is really many formats.

When we talk of print magazines one gets a pretty good idea what these look like: standard sized publications with editorial content and ads. A decade or so ago one could have argued that print was such a diverse platform that it would be silly to talk about "print" as any one thing. But the rise of the web has significantly hurt product tabloids so much that few see this format as growing in the future.

If print was a diverse platform in the past, digital is quickly becoming more and more varied. Digital no longer means just the web, not when mobile and tablets are growing at such an incredible pace.

That's why anyone who thinks digital won't grow even faster in the future may be missing the message contained in Apple quarterly earnings blow out. Apple launched the iPhone in 2007 and now sales are continuing to grow. But it also launched the iPad in 2010 – a related product, but a different line item on its P&L. The combination of the two products, neither of which existed five years today, made their sales explode.

If Apple had mirrored the publishing industry, it would have launched one new product and then simply watched as they enjoyed incremental gains in one area.

It is easy to say that "as an industry" digital will grow 10+ percent over the next five years, while print declines by a certain percentage. But this is not how things will play out for the actual publishers experiencing this.

Let's say you are the publisher of a B2B print magazine, and you "know" that your advertisers will be spending five to ten percent less in print each of the next five years. How will this effect you?

I would say that for the number one book in the industry it won't effect them at all. Advertisers rarely cut across the board – they know that they must maintain a certain level of presence in any book they advertise in or else their ads won't be effective. More likely, an advertiser cutting back on print, especially in the B2B area, will reduce the total number of books they appear in, shifting those dollars saved by cutting the number of magazines they book to new digital products.

For some publishers, the shift to digital means a chance to grab some new dollars, while at the same time maintaining their print schedules. For others, it means going from "in the schedule" to "out".

This is why any level of decline in ad dollars devoted to print can have a devastating effect on an individual publisher.

The lesson: if your magazine is not currently the number one or two magazine in its field it is seriously vulnerable to shifts in ad dollars.

The problem with forecasting is that it rarely takes into account new technology. Most publishers see technology as an outside force that can effect their business. But in modern publishing technology is, in many ways, central to their business. Any publisher that does not also see themselves in some way as a technology company is at a major disadvantage.

This might not mean that every publishing company of any size must become a developer, but it does mean that they had better think very hard about the partners they have in this area.

As a magazine publisher I never lost a night of sleep worry about whether RR Donnelley and print technology. But if I were depending on many of the third party vendors currently creating mobile and tablet apps I might never sleep again, such is the quality of much of the products being introduced into Apple App Store and Google's Android Market.

But for those publishers with print products that are currently not the number one book in their industries, this moment is a golden opportunity. The shift to digital, though a threat, could be their chance.

Note: Right now, at this minute, inside Apple's iTunes App Store, the publications being promoted are GQ, Better Homes and Gardens, and other familiar titles. But also being promoted is Project Magazine and The Daily, new digital-only publications. Also being promoted is Newsweek, which has been on its death bed for years.

Apple total sales for the iPad reaches 55 million

One of the questions I am asked most often by publishers and other media executives is what is the total number of iPads in the market – many in Europe want to know what the penetration of the iPad is in their country, a much harder question to answer.

Well, for those keeping score, Apple has now reached the 55 million mark.

Apple began selling (or more accurately, shipping the iPad since they accept pre-orders) in April of 2010. April represents the first month of Apple's third quarter.

Apple managed to sell 3.2 million iPads that first quarter, a number that shocked a lot of people. But this is the lowest month for sales the iPad has experienced. Here are the numbers according to Apple's own earnings reports:
2010 Q3 3,270,000
2010 Q4 4,188,000
2011 Q1 7,331,000
2011 Q2 4,694,000
2011 Q3 9,246,000
2011 Q4 11,123,000
2012 Q1 15,434,000

Total units = 55,286,000
One can expect that sale for the iPad will dip sharply in Apple Q2 of 2012 – this is the first quarter of 2012, after holiday sales and before the introduction of the iPad 3. This occurred last year, as well.

The only thing that would boost sales would be an early introduction of the new iPad, and I would be surprised if Apple would do this. But one can expect that Apple will reach the 60 million mark in Q2 and will be able to announce that they have reached the 100 million mark by this time next year.

The iPad revenue, which includes according to Apple includes "revenue from sales of iPad, iPad services, and Apple-branded and third-party iPad accessories," reached 9.15 billion in this quarter, which is about 28 percent more than the total revenue the company generated from Mac sales. When you combine this with the iPhone and iPod, you see that Apple's iOS business now is 80 percent of Apple's hardware business.

The biggest question on the minds of publishers concerning the iPad has always been "at what point is the market big enough that I should invest in a tablet edition?" These numbers should calrify things for quite a number of them.

Tuesday, January 24, 2012

Another blowout quarter for Apple, but what did you expect? More than 15 million iPads sold in Apple's Q1

The numbers Apple reported today for its fiscal 2012 first quarter were so good that not even Business Insider, that has predicted doom and gloom for the tech giant could say anything negative.

Most observers pointed out that Apple's profit, $13.87 million was more than Google's revenue for the quarter. But Apple, one must remember, sells things (you know – laptops, desktops, phones – oh forget it).

"We're thrilled with our outstanding results and record-breaking sales of iPhones, iPads and Macs," said Tim Cook, Apple's CEO in the company's press release. "Apple's momentum is incredibly strong, and we have some amazing new products in the pipeline."

For the media world, the numbers really aren't that important so much for the huge revenue and profit gains, as they are in that they confirm that the company's iOS remains the most important platform for digital publishing.

While Apple sold 37.04 million iPhones (an amazing number, isn't it?) the iPad sales number of 15.43 million units was the one that caught my attention.

Just think, one day even Jeff Jarvis might buy an iPad again, though I doubt it. That would have made it 15,430,001 iPads, but who is counting?

Today again I read on a forum that the future of magazines is not iPad apps but something else, which I've forgotten. The point was that the future is still print. Few would agree with this, but the sentiment that one shouldn't develop for the iPad still is out there. I doubt even 15 million new iPad owners won't convince some people that their businesses depend on reaching these readers. We'll miss them when they fold, or maybe we won't.

Here are the numbers from the earnings call:
  • Revenue: $46.33 billion
  • Profit: $13.06 billion ($13.87 per diluted share)
  • iPhone sales: 37.07 million
  • iPad sales: 15.43 million
  • Mac sales (remember them?): 5.4 million
  • Cash on hand: more than most countries

B2B magazines become increasing irrelevant to their industries as they eliminate audits, let lists deteriorate; MacFadden still investing in great BPA audit reports

Two events in the past 24 hours has me wondering why anyone would want to in the B2B media business in the U.S. anymore: the continue involvement of PE firms and the continued decline of B2B publications themselves.

The second reason came to mind when I read a tweet from a B2B industry publication promoting its iPad app. I found it strange that the industry trade publication would be promoting its app because my memories of it were that it was an unreadable mess created by one of those replica app makers. I decided to check it out again inside the App Store to see if they have updated it.

No, the app was still the same one as originally released. Based on its lack of reviews, and the fact that its last update was a year ago, I wondered why they would think it important enough to promote. Whatever.

Still, it saddened me to realize that the publishing industry's main trade journals are so backward and completely obvious to the changes occurring in the industry they are supposed to be covering. Instead of leading their industries, they are merely mirroring them – not what a trade journal should be doing, in my mind.

I looked at a few more new and updated apps inside Newsstand and noticed a few more B2B publications, as well. Although each were also replica edition apps, what caught my attention was that one of them was for a publication I had never heard of, despite being fairly familiar with the publications inside that industry. Who were these guys, and why hadn't I heard of the magazine?

I checked out the publication's website to get more information and quickly found the media kit. I shook my head knowingly as I saw that it was one of those consolidated kits, created (theoretically) to promote magazines inside the same family of industries.

I guess I am more than a little cynical about these things, having experienced modern B2B publishing firsthand. While most publishers justify consolidated media kits based on similar subjects, the truth is often that one kit for multiple magazines is simply cheaper than producing multiple kits. Further, it was obvious that the same person was acting as publisher of all the magazines. Again, one publisher is cheaper than two, or three.

As I continued to explore these publications I noticed that "BPA" was mentioned once, but not consistently. In other words, the magazine I had not heard of was not audited – no surprise, less and less B2B magazines are being audited.

Short takes: Romney tax returns show that it's good to be rich; Eurozone finance ministers want Greek bondholders to settle for rates below 4%; U.K debt at record levels

My it's good to be rich and unemployed. Mitt Romney, who is both, finally released his tax returns which revealed that the an makes big dollars off his investments, but pays very little in taxes compared to the average working stiff.

Bowing to pressure from his primary opponents, and hoping to diffuse a potential big issue in the fall, Romney released his tax returns for the past couple of years. It shows that he earned over $21 million on his investments. But because of the current U.S. tax laws, he only paid a tax rate of around 14 percent, lower than most Americans, and much lower than most middle class workers.

Romney's returns show what many suspected: the leading candidate for the GOP nomination has not earned a salary in years, yet is raking in big dollars due to his wealth. But because his earnings come from investments, rather than a paycheck, he pays less in taxes on that money.

"You'll see my income, how much taxes I've paid, how much I've paid to charity," Romney said during Monday night's debate, according to the NY Daily News story. "I pay all the taxes that are legally required and not a dollar more. I don't think you want someone as the candidate for President who pays more taxes than he owes."

European finance ministers demanded that private bondholders must accept a deal to be paid interest rates on Greek debt at a rate below 4 percent. The chief negotiator for the private bondholders, Charles Dallara, walked out of talks on Saturday when an agreement seemed to be in place to pay 4.25 percent, but then was informed that Euro leaders wanted the rate below the 4 percent level.

While the NYT report headlined Permanent Rescue Fund Seems Nearer in Europe, the view from Europe is that the rejection of the deal "sets the stage for a Greek default when a 14.4bn euro matures on March 20", said the Athens News.

If your national debt is large the way to reduce it is to cut spending, right? But if one is in recession, and the lack of tax income is reducing revenue, then cutting spending threatens to make the debt level even higher, right?

Well, that second question is at the heart of the battle between opposing economic philosophies. Keynesians such as Paul Krugman have argued that one can not promote austerity at a time of great recession without making the situation worse, and actually growing one's debt. Austerity proponents, who are in charge in most European nations, and here in the U.S., say that one must cut spending first.

In the U.K. the theory is being put to the test.

Today the Guardian reported that Britain's national debt has risen above £1 trillion for the first time ever, despite austerity measures instituted by the conservative government - a government that shows no signs of backing away from its austerity programs.

"[This] shows the unsustainable level of spending this country built up over the past few years, and shows why it is critical for our nation's future that we deal decisively with the deficit," a Treasury spokesman said, the Guardian reported.

Despite the austerity measures, and the rising debt levels, a recent Guardian/ICM poll shows that the government of David Cameron is actually more popular now, with 40 percent support versus 35 percent for the Labour Party.

Monday, January 23, 2012

Price break! Newsweek updates its iPad edition, lowers its subscription rates to $1.99 per month or $19.99 per year

Struggling news weekly Newsweek has updated its iPad app, bringing the news weekly into Newsstand, lowering its subscription prices, and upgrading its digital design.
Whether this Newsweek can ever entice readers to return to the new weekly format it an open question, but the team at Newsweek now has one of the best tablet editions out there, so no one can say they have fallen down in that regard.

The Newsweek app was updated last night and brings the news weekly into Apple's Newsstand. It also lowers its subscription prices to $1.99 per month, or $19.99 for a year.

In November of 2010 Newsweek began offering subscriptions at $9.99 for a three month subscription, or $14.99 for six months. When first released (see original post on its launch here) in May of 2010 the app simply charged $2.99 per issue without any subscription offer.

While the lower subscription prices will be well received by readers, it is the native tablet design that will wow readers (I'll leave content out of the equation for now). The updated Newsweek app works in both portrait and landscape, but despite this the latest issue weighs in at under 140 MB. It does this by not stressing multimedia so much as good tablet layouts, with articles that scroll, and with embedded text boxes on some articles that do the same.

Although the update has only been available for a short while, readers are already commenting in the App Store, with the majority of reviews very positive. Some readers, however, are having trouble accessing their issues through the log-in mechanism for print subscribers – this accounts for the half-dozen or so negative reviews.

"Fantastic," wrote one reviewer. "Such an easy to use and beautiful app. Definitely a must have. Thank you Newsweek." (spelling corrected)

Left: the subscription and issue download page; Right: Table of Contents.