Apple News+ Is Having a Hard Time Gaining Traction

Apple News Plus on iPad Credit: Hadrian / Shutterstock
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It’s easy to understand how Apple Arcade and Apple TV+ have been pretty big hits. After all, games, movies, and television are very popular mediums even without a subscription service, and at the prices Apple is offering them at, they’re an easy sell.

Apple News+ on the other hand, with its promise of hundreds of magazines and a handful of premium news publications for a $10 monthly fee, appears to have been a slightly more difficult service for many people to embrace, and it’s probably not surprising to find out that, six months later, Apple has failed to really add any significant number of new subscribers beyond the initial surge.

When Apple first debuted Apple News+ in late March, it gained about 200,000 subscribers within the first 48 hours, but according to a new report from CNBC, sources say that this number “hasn’t increased materially from its first couple days.”

In fact, all of those initial subscribers would have been taking advantage of the one-month free trial that Apple offered, which means many were likely just kicking the tires on the new service, and it’s unclear how many continued with the service into the following month once their free trial was up.

Apple doesn’t publish specific numbers for any of its services, but even so the estimated number of Apple News+ subscribers, which comes from industry insiders, pales in comparison to the launch of Apple Music back in 2015 which hit 10 million subscribers in the first six months after its release, and now boasts over 60 million. By all reports, Apple also attracted millions of viewers to Apple TV+ over its launch weekend, but with most of these also taking advantage of free trials — some for as long as the next year — it remains to be seen where the paying subscriber base will land, but it’s a safe bet that it will measure well into the tens of millions, especially since unlike Apple Music, Apple TV+ has the advantage of boasting exclusive content that enhances, rather than competes with, other streaming services.

Apple News+ Eclipsed

By comparison, Apple News+ seems like a dismal failure, having almost certainly failed to break even one million subscribers. There are undoubtedly a lot of factors behind this, ranging from the already lower appeal of print publications in a modern multimedia world, combined with divisions within the news industry, the politics of getting publishers involved, and a wide range of technical problems, both with Apple’s implementation of the News+ app itself, along with the struggles publishers have faced in presenting their material in compelling formats — it’s hard to convince users to pay $10/month just to read a PDF of their favourite magazines on a smaller screen.

It also doesn’t help that the service has been completely eclipsed by the launch of Apple’s newer Apple Arcade and Apple TV+ services, which are not only considerably more appealing but also cost half the price of an Apple News+ subscription. Of course, Apple hasn’t exactly been going out of its way to promote Apple News+ even in the weeks following its initial launch, which left some publishers questioning how serious the iPhone maker really is about the service.

However, various publishing industry sources reveal a mixed set of opinions about how much of a success Apple’s news service has been to their bottom lines. Norm Pearlstine, the executive editor of the Los Angeles Times, seems to remain optimistic, telling Bloomberg this week that the numbers are “consistent with our expectations,” adding that he expects the service to “grow in the months and years ahead.”

Other media executives are less bullish on Apple’s prospects, however, already expressing disappointment with the income they’ve received from Apple News+, saying that it’s been less than expected. One magazine publisher said that they were only getting around $20,000/month, which was less revenue than they received from Texture, the company that Apple acquired to form a big part of the foundation of Apple News+.

Another publisher told CNBC, however, that although their subscription revenues were lower than expected, the advertising revenue from the mainstream Apple News service — the non-subscriber version — has “slowly but consistently climbed” and that the service has attracted a newer demographic than they’d been able to get before.

Much of the reason for this disparity is in the way that Apple actually pays the publishers, however. While Apple takes 50 percent of the revenue from each Apple News+ subscriber, the other half is divided proportionally based on how much time is spent reading each publication. If users aren’t reading a given magazine or newspaper, less money is going to be flowing in that direction.

The Future of Apple News+

Apple is at a particularly critical juncture with Apple News+, however, since the deal it has with most of its publishers allows them to back out after a year if they’re not satisfied with the service. This could result in a mass exodus from the platform come next spring, although it’s also fair to say that if publishers leave because they’re not making money, subscribers aren’t too likely to notice as most of them weren’t reading those magazines anyway.

Still, this makes it pretty easy to understand why Apple may be even more motivated to create a services bundle that includes Apple News+ alongside Apple Music, Apple TV+, and perhaps even Apple Arcade — a package that if priced right could help to attract more Apple News+ subscribers by basically giving it away with the other services. Due to the business model of Apple News+, however, getting users to subscribe to Apple News+ is only part of the battle — Apple also needs to find a way to encourage users to actually read the content that’s there if publishers are going to sit up and take notice, and that may be a considerably steeper hill to climb.

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