Apple 2.0

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Why iPad mags cost $4.99 each

April 30, 2010: 6:43 AM ET

Because that's what the market will bear -- at least for now

If you buy the digital editions of Popular Science or TIME Magazine on the iPad, they cost $4.99 each -- same as on the newsstand.

However, one-year subscriptions to Popular Science (the paper magazine) are currently selling for $12 -- or $1 an issue. And TIME subscriptions can be had for $20 -- around 35ยข an issue.

That disconnect was one of the topics addressed Thursday at Tabula Rasa NYC, a day-long "creative throwdown on tablet computing" hosted by WeMedia.

"We're trying to make our readers not feel like we're slapping them in the face as we explore this new world," said Popular Science editor-in-chief Mark Jannot, who demonstrated the latest iPad edition of his magazine to a roomful of developers, designers and business strategists. "But we're going to continue to be aggressive about pricing. We'll see what the market will bear."

So far it seems to be bearing up for Jannot.

Popular Science is currently No. 39 on the App Store's Top Paid list and No. 41 on its list of Top Grossing apps. TIME, which until this week required readers to download a new app for each issue, is not doing quite as well. It's fallen off the Top Paid list, having reached No. 16 the week of the iPad's launch with its Steve Jobs cover issue, and dropped to No. 73 on Top Grossing.

[UPDATE: Josh Quittner, editor at large for digital development at Time Inc., points out that those numbers are misleading because until now each issue of TIME was treated as a separate app. "If you took all of our issues and added them together," he says, "I'm sure we'd still be the top selling and top grossing mag app."]

The attendees at the WeMedia conference had widely divergent opinions about the approach publishers are taking.

"I like the brazenness of TIME's $4.99 an issue," said Roger Black, a veteran magazine designer whose portfolio includes the logos for both TIME and Newsweek.

"I think the TIME Magazine app is the most sinful piece of shit ever," said Buzzmachine's Jeff Jarvis, a former Time Inc. editor and author of What Would Google Do? "The ego of it was unabashedly awful."

[For Quittner's response to Jarvis, see And the horse you rode in on.]

Jarvis, it turns out, wasn't talking about the design or the price, but the fact that TIME seemed to be moving the magazine from the Web, where it is searchable and clickable, to an app, where it is neither.

Joe Zeff, a former TIME deputy art director and an advisor on its digital edition, didn't take Jarvis' bait, but confessed he wished the magazine had the resources to take better advantage of the iPad. The design staff is currently putting out what amounts to three different issues each week, he says, a paper issue, a horizontal iPad edition and vertical iPad edition.

Merrill Brown, a senior consultant for Journalism Online, which is pushing what he calls the freemium model for magazines and newspapers (some content free, some paid), thinks most publishing executives don't know what they're getting into. "Putting up a wall does not solve your business problem," he warned. "Publishers who think they can put their magazine on an iPad and make a lot of money are making a significant mistake."

Alisa Bowen, a senior vice president at Thomson Reuters, reminded the audience what magazines and newspapers are for: selling advertisements. What most people are missing, she said, is the significance of the 125 million credit card numbers Apple has collected over the years. "125 million people with their credit cards out, one tap away from spending money -- this is huge," she said. "It's a massive opportunity."

As for that $4.99 per-issue magazine price, it will come down in a month or so when Apple (AAPL) allows magazines to set up subscriptions on the iTunes store, says Popular Science's Jannot. But it won't come down much. He's planning to charge $29.99 for 12 iPad issues and $19.99 for six.

[Follow Philip Elmer-DeWitt on Twitter @philiped]

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About This Author
Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

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