Another recent buzz is due to the pre-announced decision from Apple to not allow iPad subscriptions outside of the App Store. It is indeed a hard time for media companies who were already selling iPad apps as an add-on (sometimes for free) to their existing dead tree value proposition.
I understand press groups’ feeling of being imposed an unfair decision, but let’s take some perspective on this. Apple experienced through the iPod ecosystem one of the most important economy moment of the information era: they succeeded making the transition from an “old/physical media” (Compact Disc) to digital music at a late stage: while many consumers were using peer to peer networks to download “illegally” music for free. And they sold billions of songs to date!
This has not been done hand in hand with the record companies and now everybody agrees on the fact that this strategy was the only possible to save music industry, that needs anyhow to update its business model, it’s mode for doing business.
I have the same feeling here with newspapers and magazines on iPad. I believe Apple is aware that the current situation will lead to chaos, which is not a good state for establishing a lean new business. Apple has built a whole ecosystem it controls. There are just connectivity (but commoditization process of it helps, and agreements with Carriers is also an enabler; cost of owning this step being way too high!) and content that Apple, just like Orange, as said yesterday, won’t bother to cover.
Just like I also said regarding Orange, the most important step in Digital Information Consumption and Distribution Ecosystems is the aggregation (linked to credentials). And Apple proved it right for music (iTunes Store), radios/podcasts, apps (App Store on iPhone, iPod Touch and now on Mac) including games, movies and series (also through iTunes Store).
The only problem is that Apple doesn’t have (yet?) a typical aggregation platform for newspapers and magazines. Unlike this article claims, I’m sure Zinio is in Steve Jobs’ radar since the beginning. This is the logic of monitoring your complementors activity & innovations and partnering/buying them when they step on your strategical path. Remember iBooks/Delicious Library story or Siri?
Of course, this whole logic starts from the assumption that newspapers and magazines on iPad will be big enough to take a significant market share to paper versions of it. If this is the case (just like it has been for all the media and entertainment markets listed in the previous paragraph), Apple doesn’t want (and press groups neither, except that they don’t know about it yet) iPad versions to be treated as a nice add-on, as a product plus, as a freebie to be given in exchange of loyalty to a title on paper. And if people (beyond early adopters, which could very well be a market on its own for a few years, waiting for other market segments) are not used paying for it as from the beginning, it will be impossible to revert the process.
And that is, according to me, the reason of this move. Apple is a very bad communicator, and there are probably points in the strategy that could, if publicized, cost trials to them. Consider also that Apple already had difficulties talking to dozen of carriers when iPhone stepped out of the US. Imagine how they would feel talking to thousands of press groups…