Game Marketing Tips, Analysis, and News

Thursday, October 21, 2010

The E-magazine Problem

The future of magazines?
While e-books are a growing market, the e-magazine is not so lucky. The problem has been the business model; books depended solely on their sale for revenue, while magazines have depended mostly on advertising and only somewhat on their sale price for revenue. (The mix varies; some magazines have very high sub costs and issue prices and not a lot of advertising, while others discount the subscription price heavily in order to woo more advertisers.) So e-books have found it easier to generate revenue; all they have to do is get a sale, and there are now a number of places to sell e-books online.

Magazines have a different set of challenges. Usually they aren't written by one person, so immediately you have to deal with a number of authors, editors, and layout people (sometimes the roles are combined, of course). Most of f the time those people would expect to be paid up front, or on publication, or a regular salary. If you're depending on sale revenue that means a lot of risk up front, until you have an established brand and know pretty well how much you'll make every month from sales. Which all means you'd have to have a fair amount of capital to get started (unlike the current e-book market).

The biggest problem  for online magazines is the lack of ad revenue, or a standard market for display ads like you'd see in a magazine. AdWords is a very minor revenue stream, and banner ads barely more. There really isn't a good model equivalent to full page ads in magazines, though many experiments are being tried.

This blog post from IO9 has some ideas on how to fix it, suggesting e-mags try some ideas from gaming, such as additional features you get with payments (a variant of free-to-play) or actually making the magazine point-driven, so you get points for participating and can buy more points, while points are used to gain access to some features or special benefits.

It's an interesting read, and perhaps someone will try these ideas out. Once again, though, it will have to start with some well-capitalized experimenter. Perhaps a cooperative of book authors might be able to make it work, contributing short stories and sharing the revenue from the sale... but it could get awfully complex to do the accounting unless it was the same group of authors every time.

Of course, the big thing magazines are pinning their hope on is the iPad and other tablets. At least that way they can create a magazine that looks reasonably familiar to them, and hope to sell advertisers display ads the same way they do now. It remains to be seen if that model will work, though. There are some very nice magazines on the iPad (like Popular Science), but I don't think any of them are making money on their iPad versions yet.

Innovators, the market is appearing... can someone seize it?


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