Tuesday, June 01, 2010

Tide on iPad magazine subs seems to be running to higher pricing than print

Consumers are likely to be surprised, and probably disappointed, by the pricing of magazines appearing on iPads starting this month. The assumption -- perhaps encouraged by free web posting and many digital "flip" editions that are priced less than their print counterparts -- is that iPad editions will cost less. The uncertainty extends to magazine managements who are trying to come up with a coherent pricing strategy.

Nat Ives in Ad Age  reports that iPad subscriptions to Popular Science, Popular Photography and Sound & Vision will cost twice as much as they do in print. Where they could buy a year of Popular Science for $12 (about 83 cents an issue) ordered through the magazine's website (or $10 on Amazon), an iPad edition will cost $29.95, or about $250 an issue.
Bonnier's subscriptions and pricing strategy will have company fairly shortly. Time Inc. CEO Anne Moore said last week that Time magazine iPad subscriptions are "coming soon." And she didn't sound any more interested in discount pricing than Bonnier. "It's becoming increasingly clear customers will pay for trusted, quality content," she said in remarks at a Time Warner investors day.
One commenter on Ive's story said: 
Price is just one part of the equation. The other part is utility. Combine the two and you have value. The reason publishers will be able to explore a more expanded range of pricing is that this new medium gives them an expanded range of content and interactivity, and therefore more utility that they can provide.
Consumers do not and will not understand why these magazines should cost more when they do not have to be physically printed and distributed. The first magazines to defect from the premium pricing strategy will learn this quickly. The ensuing rush to the bottom (pricing-wise) could be avoided by pricing fairly now.

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