The Publishing Industry Remains Strongly Divided on Apple News+

It’s only been a little over a week since Apple unveiled Apple News+, yet there still remains a wide divide in the news industry on whether the new service, which combines over 200 magazines and newspapers into a single $9.99/month subscription, is going to be a boon to publishers or spell the end of online journalism.

Although Apple had little difficulty convincing many magazine publishers to sign on, which wasn’t surprising as it inherited most of these from last year’s Texture acquisition, getting major news publishers on board remained a much tougher sell, with Apple ultimately only managing to woo The Wall Street Journal and The Los Angeles Times, while The New York Times and The Washington Post conspicuously sat out.

It appears, however, that this certainly wasn’t from a lack of trying on Apple’s part. The company kept working to close deals until the eleventh hour, and according to a new report from Vanity Fair, Apple’s Senior VP of Internet Software and Services, Eddy Cue, actually began a “vigorous courtship” with the news industry mere weeks after Apple closed the deal to acquire Texture.

Cue’s elevator pitch, according to people familiar with the discussions, was, “We’ll make you the most-read newspaper in the world.”

Vanity Fair

According to several sources, Apple desperately wanted to lock down either The New York Times or The Washington Post, and “put a tremendous amount of pressure on,” with Cue visiting their offices on a regular basis. However, throughout multiple meetings, Apple also emphasized that they weren’t looking for only partial content from the publications, but rather “wanted the whole shebang” with no limitations in terms of the content that the publishers would give to Apple’s nascent premium news service. Apple did offer flexible terms regarding the duration that publishers would need to sign on for, as well as exclusivity, but ultimately neither the Times nor the Post were convinced that they should get into bed with Apple.

Ultimately, however, it seems like Apple was fighting a losing battle. The New York Times for instance, appears to have politely listened to Apple’s pitch, but never seriously entertained the idea, and Times CEO Mark Thompson went so far as to warn other publishers away from Apple News+ entirely, citing his desire to avoid seeing the news industry make the same mistake Hollywood made when it sold out to Netflix back in 2007.

We’ve been pretty deliberate about saying that the best place you can experience journalism is through a relationship with a news provider. So far for us, that has meant a direct relationship with users. The more we have a relationship with users, the better we think our business will be, and the better the experience that we can provide to them.

Meredith Kopit Levien, Chief Operating Officer, The New York Times

Neither the Times nor the Post felt that they had anything at all to gain by a relationship with Apple News+ and in fact felt that they had everything to lose in terms of basically giving up their entire subscriber relationship.

Interestingly, despite Apple’s original insistence on getting full premium news content on board, it appears to have conceded much of this in its final deal with The Wall Street Journal. While the publication is technically providing all of its content to Apple News+, this is being done in a slightly circumspect manner; only a limited amount of general news content, curated by the Journal’s editors, will actually be visibly promoted on Apple News+, with everything else only available via search, and only the previous three days of content available. That said, however, the Journal has stated that it plans to hire more journalists as part of the Apple deal, although sources speaking to Vanity Fair indicated that Apple is not paying for those new jobs.

However, The Wall Street Journal is arguably at less risk of losing its subscribers than other publications would be, since it boasts a strong business and finance news background, and the kind of elite readership that wouldn’t likely even consider using Apple News+ as their information source, but rather continue subscribing directly to the Journal. In this case, expanding its general news coverage into Apple News+ has the upside of increasing its readership with very little risk of losing its core subscriber base.

Vanity Fair also adds that both Rupert Murdoch and Robert Thomson have a cozier relationship with Apple than they do with most other online services, which may have made it an easier sell. In fact, Murdoch has a “long-standing enthusiasm” for Apple, having participated in building one of the first news apps for the original iPad, and even standing onstage alongside Eddy Cue to unveil the partnership between the two companies back in those days. Murdoch also has a well-established reputation for being a contrarian risk-taker, choosing to eschew the conventional news industry wisdom and move in the opposite direction of where everybody else is going.

That said, none of the major publications are ruling out a future partnership with Apple, but most simply seem to be taking a “wait-and-see” approach to online platforms in general. New York Times COO Meredith Levien noted that her paper is willing to embrace anything that’s good for business and expanding journalism in people’s lives, but adds that they have yet to see anything that qualifies.

At this point, Apple News+ stands on the same pioneering edge of a new technology that was once occupied by Spotify and Netflix — an “all-you-can-eat” subscription service that threatens to turn the traditional methods of buying and consuming content on their heads. While at this early stage it’s unclear how things will ultimately turn out, it’s also too soon to declare that the sky is falling. While most publishers agree that it’s unclear whether they’ll make any real money from the platform, the same was said for Spotify when it originally launched. Apple has an established history of playing the long game when it comes to its products and services, and there’s no reason to believe that Apple News+ is an exception to that strategy.