Apple’s New Subscription Model and What it Means for Publishers

As promised with the release of The Daily, Apple has formally launched a new subscription feature for content publishers.

This means that magazine and newspaper publishers will be able to offer in-app subscriptions to customers. Price and subscription length can be set by the publisher and consumers will be charged using their iTunes account. Renewals and cancellations will take place through iTunes. In exchange for handling payment processing and the logistical backend of the system, Apple will get the same 30% revenue cut it gets from other in-app and App Store purchases.

Magazine publishers have been clamoring for a subscription model from Apple since the iPad was first announced, back in January of 2010.

As we noted in September, magazine and newspaper publishers have been at odds with Apple over the company’s terms for offering in-app, iTunes handled subscriptions. Looking at Apple’s official announcement, it appears that the company has agreed to at least compromise on two of the biggest points of contention: revenue share and subscriber data.

Although Apple will take its 30% revenue cut for in-app subscriptions and sign-ups, the company points out that publishers can also cultivate and acquire digital subscribers outside of the app itself. Read More