“The iPad is a boon for media companies, but not a magic bullet,” Zachary Clayton, managing director at the Emerging Media Research Council, told iPadNewsDaily. “While media companies may complain, giving Apple a 30 percent cut is far cheaper than the costs of postage and printing. Still, the economics of paid general interest content will struggle.”
Clayton said publications such as The Wall Street Journal, which offers highly specialized content, will fare better than The Daily, a general interest publication. In the long-term, he expects the 30 percent fee to be a bargain for publishers, as iPad subscriptions dramatically reduce the costs of serving customers.
“Any publisher would have to admit that 30 percent to acquire a subscription is a great deal,” said Clayton. “Look at what they have to go through now to do that: They buy a list, send junk mail, call the person on the phone, ask for the credit card and then call again when they don’t pay the bill.”
All Online Content
While newspapers and magazines get most of the play when it comes to the iPad, Apple's subscription plan extends to all online content. This includes movies, music services, games and e-books.
And this is where the first shots are being fired.
Rhapsody, the largest digital music subscription service in the United States, called the new rules foriPhone and iPad app subscriptions "economically untenable" and said it will team up with with other music services to consider options, possibly including legal action against Apple.