New York Times offers subscriptions through iOS app, with Apple getting a piece

Mar 17, 2011
Finance

After years of working on the details, the New York Times has unveiled its paywall plans to make the newspaper a paid online service — and notably, it has complied with Apple’s new subscription rules by selling them through its iPhone and iPad apps. In fact, there are only two ways you can get online […]

After years of working on the details, the New York Times has unveiled its paywall plans to make the newspaper a paid online service — and notably, it has complied with Apple’s new subscription rules by selling them through its iPhone and iPad apps.

In fact, there are only two ways you can get online subscriptions to the New York Times: through the newspaper’s website, or through its iOS apps. If you choose to go with the convenience of an in-app purchase to set up your monthly subscription to the New York Times’ online content, Apple takes down 30 percent.

This doesn’t mean that NYT is favoring Apple (AAPL) over other tablet or smart phone platforms, though. Purchasing a subscription nets you access to nytimes.com and various brands of mobile apps. For example, you can pay for a smart phone app subscription, which gives access to the website and the apps for the iPhone, Google’s (GOOG) Android operating system or a Research In Motion (RIMM) BlackBerry device. The same is true with the tablet subscription plan.

Plans break down in three forms. The above-mentioned smart phone plan, with unlimited computer access to nytimes.com and a smartphone app, goes for $15 every four weeks. The tablet plan, which offers the same terms as the phone plan but with tablet access instead, runs at $20 per month. Combine the two and you can have unlimited access on multiple platforms with the third platform, which costs $35. Subscriptions go on sale on March 28, although readers can still see up to 20 stories per month on nytimes.com and get a print subscription for cheaper than all three plans.

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The Times has been trying to figure out a decent way to make money with its Internet content for years, and the new subscription service represents its biggest push toward that end to date. But the fact that it’s playing ball with Apple, and giving up 30 percent of subscriptions that come through iPhones and iPads, is just as significant. It represents the idea that the Times sees value in the Apple market and its devices, and isn’t willing to cut them out of its business model. It also suggests that the Times expects to get enough subscriptions from iOS devices that the 30 percent will be a worthwhile investment.

Newspapers are struggling to find a way to give their online content value in a world in which stories are spread around by various websites and are largely available for free. The Times’ rolling out of a subscription plan is a significant step forward for the company, especially when readers have been receiving its service for years without paying for it. One of the keystones of the plan’s success, it seems, will be the willingness of iOS device readers to shell out for their news.

It’s the same thing Rupert Murdoch is banking on with his iPad-only magazine, The Daily, which has been free since its early February release but which will start charging readers for subscriptions next week, according to a story in the U.K. newspaper The Telegraph. The Daily’s subscriptions are substantially cheaper than NYT’s, running at $35 per year. All subscriptions to The Daily go through Apple, so for every person who pays to read The Daily’s 100 pages of new content each day, Apple gets $10.50.

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Murdoch seems to think that the future of newspapers is in devices like the iPad, and with its most recent moves, the New York Times might be acknowledging that it’s at least a possibility. It’s going to take a little time to see if the two companies are right — but the end of March marks a big experiment with revenue, the future of print journalism, and iOS, and the results could have widespread effects on the news business.

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Phil Hornshaw

Phil Hornshaw is a freelance writer, editor and author living in Los Angeles, dividing his time between playing video games, playing video games on his cell phone, and writing about playing video games. He’s also the co-author of So You Created a Wormhole: The Time Traveler’s Guide to Time Travel, which attempts to mix time travel pop culture with some semblance of science, as well as tips on the appropriate means of riding dinosaurs. Check out his profile.

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