In app purchasing for newspapers: The answer to the 60m dollar question ?

Published on October 28, 2009 in The Blog. 13 Comments

in-app-purchaseNewspapers are searching for a way to monetise their digital content
Rupert Murdoch plans to charge for all his news websites by next summer, something that didn’t seem to work well for The Irish Times, who removed their “pay wall” in June 2008.

On-line advertising revenues just aren’t paying the bills, this Observer article covers an analysis suggesting that the average print newspaper reader is worth £155 a year (£90 from price, £65 from advertising), whilst the same on-line newspaper reader is worth just £5.

So how can newspapers make money from their digital assets? The answer may be through mobile applications, Apple’s recent decision to enable “in app purchases”, supplementary content purchased from within iPhone applications, has been adopted by the Spectator magazine, their application costs .79 cent and “expires” after a week, thereafter you must pay .79 cent for the current weekly edition.

This strategy could be a lucrative play for news titles with large amounts of multimedia content. For example, the forthcoming Guardian iPhone app could easily incorporate in app purchasing for their highly successful audio podcasts covering the premiership. Apple also recently decided to allow in app purchasing from within free applications, previously in app purchases were only available within paid apps.

Closer to home the new iPhone application released by the Irish Independent newspaper seems to be doing very well. The app sells for 2.39 and is top of the paid application chart in Ireland, which means it has certainly paid for itself already, and will be making profit from here on. It is a relatively simple RSS feed style application which doesn’t use in app purchasing, it displays 4 categorises of news: National, Sport, Entertainment and Top Stories.

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There is no sign of an iPhone application yet from The Irish Times or the Examiner, but Maeve Donovan of the Times recently suggested that mobile is a big part of their strategy.

We are currently developing a number of iPhone applications which distribute large amounts of audio, photo and video content using the in app purchase model,  we are also developing a backend CMS to manage the sale of this content. Get in touch if you’d like to hear more.

John Callaghan, October 2009

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