Many Publishers Still Struggling to Make Money From Apple News

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Apple News has surged in popularity over the past year, but while many publishers are finding that traffic from the service is surpassing that from giants like Facebook and Google, they’re still struggling to figure out how to best make money from it.

In an interview with Digiday, seven publishers expressed their frustration with successfully monetizing their content on Apple News, saying that it remains a “slog” due to poor availability of advertising options and extremely poor “fill rates” — a metric that describes how often users actually see the ads that are supposed to be delivered by the app.

Publishers have indicated that although the traffic from Apple News continues to steadily increase, this is at odds with the amount of money they’re actually making from publishing content on the service. Many in fact consider Apple’s advertising options to be secondary to other revenue sources, and have tried to leverage it as offering up specific audiences that may be of value to certain advertisers.

We’ve been able to position it as a premium, in-app audience, which is attractive to some advertisers. There are drawbacks around targeting though.

Source from Apple News Publisher

However, publishers have also found themselves dealing with Apple’s brave new world of privacy protections, where the kind of user targeting that they’ve come to rely on from Facebook and Google simply isn’t available. Apple News doesn’t offer up any personal user data such as IP addresses or access to third-party data. Apple also prohibits the use of “programmatic advertising” — where ads are purchased and placed by automatic algorithms — forcing publishers to fall back to more traditional human negotiations and automatic orders. All of these issues have created incompatibilities with the way that some publishers handle advertising, forcing them to rethink their strategies in order to monetize the Apple News platform.

In terms of actually selling advertisements, publishers have two options for selling their “ad inventory” — the amount of space that they have available for advertising in their publications; they can sell advertising space directly to advertisers, or they can rely on NBCUniversal’s partnership with Apple to sell off their “remnant ad inventory” — the advertising space in their publications that they can’t sell to advertisers directly.

Publishers have to give up a 30 percent cut of all ad sales made by NBCUniversal, so it’s naturally preferable for them to sell as much advertising space directly to publishers as they can. However, the publishers speaking to Digiday have found that most advertisers aren’t interested in the ad inventory that publishers are selling directly, leaving most of their advertising space in Apple News filled by NBCUniversal.

While publishers concede that these remnant ads fetch a reasonable rate, they only get paid when the ads actually appear to readers. With a “fill rate” of less than 20 percent — meaning that the ads appear less than 20 percent of the times that they’re supposed to appear — sources have said that the number is so “atrociously low” as to make publishing on Apple News worse than even Google’s AMP pages or Facebook’s Instant Articles, both of which have also been criticized for providing poor monetization.

I respect Apple and that they believe in privacy. It just makes it incredibly challenging to sell there.

Source from Apple News Publisher

Despite the monetization problems, however, most publishers still remain somewhat enthusiastic about Apple News due to the level of audience growth that it has been able to deliver. Three sources told Digiday that Apple News is now driving more traffic to them than Facebook does; a trend similar to that reported by Slate last fall. Publishers are also impressed by Apple’s human curation and ways of featuring stories, which can “drive enormous boosts in traffic,” and in some cases stories featured by Apple News can become among the highest-read stories that a publisher can share in any given month.

Still, with Apple poised to launch a premium subscription news service as early as next month, many publishers are still trying to figure out how to actually turn all of those eyeballs into actual dollars. While some of the biggest news publishers are balking at Apple’s demands for 50% of subscription fees, many magazine publishers have already signed on for the deal. However, subscription fees are ultimately a drop in the bucket compared to the money that publishers make from sales of advertising space, and unless both publishers and Apple can find a way of addressing this, it’s going to be an uphill battle to convince publishers to fully embrace Apple News as anything more than a secondary platform for delivering their content to readers.

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