Apple, Conde Nast reach "New Yorker" iPad deal

NEW YORK Mon May 9, 2011 1:53pm EDT

A staff member holds the new Apple iPad2 at the Apple store in London March 25, 2011. REUTERS/Luke MacGregor

A staff member holds the new Apple iPad2 at the Apple store in London March 25, 2011.

Credit: Reuters/Luke MacGregor

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NEW YORK (Reuters) - Apple Inc and magazine publisher Conde Nast reached a deal to offer the New Yorker on the iPad device in the latest sign that relationships are improving between the technology company and content owners.

Conde Nast said iPad editions of other magazines will also be available by subscription through Apple's In-App Purchase system on the popular App Store. Titles including Vanity Fair, Glamour, Golf Digest, Allure, Wired, Self and GQ will be available in coming weeks.

Publishers have eyed fancy digital versions of print publications for tablet computers like the iPad but have held back because of what they considered onerous terms.

"Over time, we'll see subscriptions leading to greater and greater scale, helping to drive overall industry growth," said Robert Sauerberg, Conde Nast president, in a statement.

Apple clashed with publishers in February when it introduced a standard 30 percent fee on all sales within the App Store, including paid subscriptions.

Many publishers have complained that the fee is too onerous to establish profitable subscription sales via the increasingly popular iPad. Also at issue: whether the publisher or Apple owned the customer relationship.

Conde Nast focused on customer relationship data in its negotiations with Apple's Internet services executive, Eddie Cue.

Under the agreement Conde Nast now has with Apple, when customers subscribe to magazines via the App Store they will receive a prompt to share their email and establish a log-in to access additional content, according to a Conde Nast spokeswoman.

The magazine publisher also convinced Apple to let the 1 million existing subscribers of the print edition of the New Yorker download and read iPad versions of the magazine for no additional fee.

"We are confident we will have data we need to make this a strong business long-term," said Conde Nast spokeswoman Mistrella Murphy.

Conde Nast also pushed for pricing flexibility with Apple. In February Apple said publishers would not be allowed to sell a subscription via the App Store at a higher price than it does elsewhere. Conde Nast said it will offer print and digital bundles of some of its titles like Wired for the same price as it sells the iPad edition on its own.

Following the uproar over its February announcement, Apple has in recent weeks started reaching individual deals with major publishers, including Time Warner Inc's Time Inc and Hearst Corp. Hearst, which publishes Esquire and O: the Oprah magazine, will have more access to customer information from subscriptions sold through the App Store.

Time Inc's improved relationship with Apple has already inspired it to begin testing the limits of getting online readers accustomed to paying to read Fortune, a publication that hitherto has been available for free.

Fortune magazine, owned by Time, made a widely discussed feature story about Apple available only to customers of its print and iPad editions. The story was kept off Fortune.com.

(Editing by Steve Orlofsky)

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