Some publishers, associations and academics who met Thursday to discuss new subscription plans from Apple (NSDQ: AAPL) and Google (NSDQ: GOOG) say they want the platforms to end censorship, work with them transparently, give them direct customer relationships and offer fairer business terms.
Publishers present included Dow Jones, Bonnier, Axel Springer, Schibsted, Telegraph Media Group and Le Monde. The statement below produced by the International Newsmedia Marketing Association (INMA), which called the meeting in London, is not a formal resolution, and those present were not necessarily unanimous, but it does capture the mood of the meeting, INMA Europe president Grzegorz Piechota tells paidContent:UK.
Startlingly, some at the meeting were under the impression the “30 percent” rate stated by Apple is exclusive of VAT, which, in many countries, runs up to 20 percent. They’re now fearing giving away 50 percent of their tablet subscription income. “How can you give up half of your revenue?,” Piechota asks.
But the commission rate was last on the publishers’ list of four requirements from platform gatekeepers. Chief was “censorship”, which Piechota says is “not negotiable”. They are perturbed by cases like that of Denmark’s Elkstra Bladet, which has been refused from iTunes Store because it features a semi-naked girl on its page nine, or the magazine about Android which has been denied iPad distribution – two cases European Parliamentarians raised with European Commissioners last month. “When a newspaper is published in a legal way, it is not the role of a platform provider to censor it or not,” Piechota says.
The bugbears raised in the meeting are rather trying to exert control over the stable door after Apple’s horse has bolted. But publishers – many of which feel out of the loop because Apple’s level of engagement has varied and is generally considered to have been insufficient, clearly feel need to voice concern. They have many unanswered questions, so are trying to fill the vacuum with some requirements of their own; there is much confusion.
“There are so many questions about what it really means,” Piechota says. “You can give Apple’s press release to 50 publishers in the room and there are many different interpretations.”
Publishers INMA has heard from clearly favour Google’s One Pass, which has appeared more flexible than iTunes’. Although the market is young, can they really hope to talk Apple around at this late stage? “We still can sit together and talk,” Piechota tells.
LONDON (17 February 2011) – INMA today hosted an invitation-only Roundtable on Tablet Subscriptions at the Park Inn Hotel at London’s Heathrow Airport, featuring nearly 60 representatives of the European media industry.
The meeting featured a robust and sometimes intense discussion of new app subscription plans by Apple and Google, the best ways to meet with such intermediaries, potential alternative subscription models, and the possibilities of HTML5. Meeting organisers described the mood of the audience as “optimistic yet realistic” and “frustrated by the unclear rules” and uncertainty of doing business with the biggest player in the tablet market, Apple.
News executives present at the INMA meeting expressed their admiration for innovative companies like Apple, Google and others. Publishers learn a lot from them about how to focus on customers, how to serve them better, and how to provide great experiences.
Publishers also understand that these are still the early days of the tablet technology, its commercial environment, and how the key relationships should work.
Meeting participants expressed a consensus to encourage competition among technology providers because it serves both users and content publishers. At the same time, there is a need for cooperation among publishers.
News publishers want to raise four key concerns to the technology companies. These themes emerged from the discussions at today’s INMA roundtable:
1. Censorship of content
Freedom of speech is the basis of the media’s existence. Publishers cannot agree with the practices of technology companies that interfere with editorial decisions on what to put into a digital publication. So we appeal to Apple to change its rules and practices that led to the rejection of apps in some European countries regarding content considered legal and appropriate in those countries.
2. Transparency in the framework
The development of apps is complex and expensive. Platform providers should assist all developers – including content providers – in the interpretation of guidelines to expedite the development process. These interpretations should be made publicly available so that others can better understand the requirements. Publishers encourage technology companies to devote resources needed to provide this assistance.
3. Direct relationship with customers
A direct relationship with customers is crucial for publishers so they can: a) provide products and services; b) set pricing policy, build bundles on their own and set prices dynamically; c) see if customers like the product, price, and the total experience; d) improve their products, services or policies accordingly; e) inform customers about existing and new products, services or policies.
4. Fair business partnership
Publishers also understand that this is an emerging market and therefore it needs time to develop and to see which business practices are the most valid ones for all involved. These practices should be discussed widely by all partners so they can work for everyone. We know this involves the economics of the digital marketplace. Yet publishers simply can’t afford to invest in new technology, products and services when the platform charges them 30% of total revenue – which in Europe, after VAT, can approach 50%.
Said Grzegorz Piechota, president of INMA Europe: “The publisher’s goal is to be able to provide their customers access to content on any device or a platform they wish for a reasonable price. Therefore, they don’t want to leave any platform, especially the one that is already popular and provides convenient payment systems. Before taking any antagonistic actions, publishers plan to talk to all technology providers, platform providers, and other stakeholders themselves and with the help of their associations.”
Added Piechota: “When talking about tablets, we used to focus on opportunities that this technology provides to deliver multi-media content and what kind of content should it be. Now it is high time to talk about business models and details of partnerships. We understand it is a new topic also for our partners in the technology sector.”
About INMA: INMA is the world’s leading provider of global best practices and marketing ideas for news companies looking to grow amid profound market change. The Dallas-based INMA is a non-profit organisation with nearly 5,000 members in 80 countries consisting of the world’s leading news companies. INMA has taken an industry leadership role on mobile and tablet developments with three tablet summits, a publication and a blog, among others.
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