UPDATE 3-Google woos publishers with digital payment service

Wed Feb 16, 2011 3:44pm EST

* Lets publishers charge for content in various ways

* Google keeps about 10 percent of subscription revenue

* Service works for content in websites and in apps

* Currently available in U.S., Britain, 5 other countries (Adds company and analyst comments)

By Alexei Oreskovic and Jennifer Saba

SAN FRANCISCO/NEW YORK, Feb 16 (Reuters) - Google Inc (GOOG.O) launched a service to make it easy for publishers to sell digital versions of newspapers and magazines, undercutting a similar plan launched by Apple Inc (AAPL.O), as both tech titans battle to dominate smartphones and tablet computers.

Google announced in a blog post on Wednesday its plan to woo newspapers and magazines, a day after Apple rolled out a subscription platform for digital media sold through its iTunes app store.

Google said its new service, dubbed One Pass, allows publishers to sell content that consumers can view on websites as well as in specialized apps designed for smartphones and tablet PCs. Publishers can charge for content in a variety of ways, including subscriptions, metered access and sales of single articles.

Google is letting publishers keep about 90 percent of subscription revenue gained through One Pass and is passing along some customer data.

"Our intention is to make no money on it," said Google Chief Executive Eric Schmidt at an event in Berlin. "We want the publishers to make all the money."

Google's service also lets publishers provide existing print subscribers with free or discounted access to digital content, Google said.

Newspaper and magazine publishers are looking to reap revenue from online and digital editions in the hopes of reviving declining readership and advertising revenue.

"All of the sudden the entire news industry is saying we need digital subscription money and we need it now," said Ken Doctor, a media analyst with Outsell Research.

Consumers must use the company's payment system, Google Checkout, in order to use One Pass.

On Tuesday, Apple introduced a long-awaited subscription plan for magazines, newspapers, videos, music and books that provide digital content in specialized apps for iPad and iPhone users. [ID:nN15160796]

The service allows Apple to keep 30 percent of customer payments to any publisher with a presence in its App Store. Apple also lets consumers decide how much personal data to supply publishers when they sign up for subscriptions. Analysts have said Apple's new plan risks angering content developers.

"It's shortsighted," Forrester analyst James McQuivey wrote in a blog post. "Apple has given every publisher, producer, and distributor in the business a reason to actively pursue alternatives to the elegant apps that Apple had hitherto taught us to depend on."

One sticking point with publishers on Apple's subscription plan involves customer data. Publishers are particularly protective of subscriber data such as names, addresses and credit cards because it helps them court advertisers and market new products to existing readers.

Google said it will share a customer's name, zip code and email address with the publishers though consumers have the option not to share that information, said Google spokeswoman Jeannie Hornung.

"We do not share credit card and payment information," Hornung said.

Google's partners include the German-based media company Axel Springer AG and U.S.-based newspaper companies Media General (MEG.N) and Rust Communications. One Pass is currently available for publishers in Canada, France, Germany, Italy, Spain, Britain and the United States. (Reporting by Alexei Oreskovic in San Francisco and Jennifer Saba in New York; Additional reporting by Eric Kelsey in Berlin; Editing by Gerald E. McCormick, Steve Orlofsky and Richard Chang)

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