On greed and the future of publishing
Here’s a great bit of insight from the minds of publishing giants. Taken from “New Yorker Editor David Remnick Thinks You Should Pay More Than $1 For His Magazine”
“There’s no doubt to me that the business of practically giving away the magazine to jack up circulation has no future,” David Remnick, editor in chief of Condé Nast’s NewYorker magazine said during a recent lecture. “I think you can pay more than a buck for the magazine.”
Remnick was speaking at a Columbia Journalism school lecture series, according to a university report. He referred to The New Yorker’s current print subscription offer: 47 issues, at $39.95.
That’s actually 85 cents per issue.
Pretty clear what’s going on here. Apple wants to set a simple, compelling flat rate for on-line media much as it did for flat-rate iTunes pricing. The 99¢ iTunes pricing strategy was brilliant because few people can argue that 99 cents is way too much to pay for convenience … as in “99 cents to hit this button and get the song delivered to me immediately, automatically? No way — I would much rather borrow my friend’s CD, rip the song, and get it for free.”
The only people for whom that kind of statement makes sense are those making less than about $6 an hour (assuming, for example, it takes you roughly 10 minutes to go find the CD, insert it in your drive, open up your favorite audio app, rip the track, save it, download the album artwork, etc.). Given the enormous number of songs downloaded from iTunes (nearing 10 billion), it is clear that 99¢ is a good target for a surprisingly large number of people.
But the music recording industry has repeatedly stated that they are losing money over on-line sales … that is odd, since prior to iTunes they didn’t make a penny off of downloaded music, so iTunes and related pay-for-music sites can only represent an increase in profits for on-line distribution. That by itself suggests the music recording industry is simply pissed off that, with the advent of digital media, they aren’t quite as profitable as they were when they had iron-fist control over the medium. Given what profits and attitudes used to be like (“And did we tell you the name of the game, boy? We call it Riding the Gravy Train …”), I don’t feel all that sorry for them.
So now the same story is being played out in print. Call me naive, but I am surprised by this. When the publishing industry controlled the medium (paper distribution), they made money. When content went digital, they lost control, profits went down. Apple [I’m assuming it’s Apple] is offering these guys a life-preserver that mirrors the iTunes/audio thing, and they are getting snippy. Hilarious that they want to charge more for on-line media than they do for print media, when print clearly costs more to manufacture and to distribute. Assuming the same $0.99 pricing structure with a 30/70 cut, then these guys would be getting nearly $0.70 per electronic issue, where they are now getting $0.85 per print issue.
What’s even more troubling is that Remnick admits circulation is likely to increase significantly (to me, “jack up” implies a non-trivial increase). So their manufacturing and distribution costs will go down significantly, they will take in roughly 80% per issue of what they currently get now (for hardcopy sales), and they expect circulation numbers to go way up.
What am I missing here?
Evidently the print business is just as blinded-by-greed as the music recording industry, which is surprising, because I had just assumed they were smarter. Oh well. I had been looking forward to getting a bunch of eZine subscriptions on an iPad when it comes out, but I’m guessing that it may take a bit longer than suspected.
