Apple is taking a hard line with publishers during its negotiations for a proposed news subscription service.
With an aim at becoming the “Netflix of news”, Apple’s service would give customers unlimited access to news articles from some of the most popular publishers for just $10 per month. News organizations are reportedly balking at Apple’s proposed revenue split though which sounds downright greedy.
Publishers would split revenue 50/50 with Apple under the current proposal, according to reports from both The Wall Street Journal and AdAge. Revenue would be divied up to publishers based on the amount of time users spent engaged on their articles.
Apple currently splits revenue with iOS and macOS developers 30/70, with developers getting the larger portion. When it comes to subscriptions sold through the App Store, Apple keeps 30% of the price the first year. It only takes 15% every year after that though.
Apple’s tough news negotiations
Another sticking point is Apple’s proposal is its refusal to provide email addresses and credit card info to publishers. News orgs like The New York Times, The Washington Post and The Wall Street Journal have been busy building their own news subscription services the last few years. All of their subscription options cost over $10 per month.
“It feels like a punch in the nose, to hear those [revenue sharing] numbers,” said Jason Kint, CEO of Digital Content Next, in an interview with AdAge. “There is significant concern around how platforms are squeezing the oxygen out of the media ecosystem. We’ve appreciated Apple’s thoughtfulness and leadership on a number publisher concerns over the last year. It would be good to see them take some actual leadership on the economics of the industry and recognize the value of the news and entertainment they help distribute.”
Apple will supposedly package the news subscription service inside the Apple News app. With 90 million current Apple News users, the company is promising publishers it can bring in a wave of new readers and subscribers. Many publishers are doubtful of Apple’s ability to deliver.
The news subscription service will reportedly launch later in 2019. That’s if negotiations go well. Apple is also working on a TV streaming service, video game subscription service and magazine subscription service. Some of those services could possibly get packaged together for one monthly fee.