What Apple’s announcement means for publishers

Every one is talking about the new iOS5 and iCloud that Apple announced last Monday, June 6th. Don’t get me wrong, I think these things are great and look very promising. However, the most important thing for me wasn’t about a specific feature, but about how they all tie in to make owning a computer pointless. 

Yes, you no longer need a computer to own an iOS device. And this means that the iPhone, the iPad and the iPod Touch just got a HUGE price discount. Of course they didn’t literally get a discount, but if you subtract the cost of a computer, owning an iOS device is way cheaper than before. Taking the computer off the equation also means that iOS devices suddenly became interesting to people who are too afraid to use a computer because of the learning curve or to people that simply don’t want one. This makes iOS devices, and specifically the iPad, more appealing to a lot more people. Now, there’s no excuse!   

It took some time, but Apple realized that to explore and belong to the digital world most people don’t need computers. Just like they don’t need one to read a newspaper or a magazine. Why pay $700 just to send emails and browse the web, when you can pay a little less, and make the whole experience easier and ultra portable? 

I’ll get to my point: what does this mean for the publishing industry? Well, now there is an electronic device that can actually work the same way as the paper... only better.

Another feature that Apple announced is Newstand, which is basically an app that keeps all of your digital subscriptions in one place. The best part is, that every day or week that a new edition is published, Newstand automatically updates the information in your iPad. It’s like getting the newspaper fresh from the printing press! This makes the whole transition to online a bit smoother, because Apple takes care of the whole distribution part. In the long run, publishers and newspapers can look at a future with lower costs and capital expenditure, at least in the packaging and distribution part of the value chain.

This will enable them to spend more where it actually counts: content creation. Of course some money should be put aside for marketing, because my guess is a lot of publishers are going to be competing for the consumer’s time and money. Subscriptions prices should decrease as well, in order to attract more consumers. And the best part for the publishers is the reach. According to Apple, in less than 2 years, 25 million iPads have been sold. The company has projected that they will sell 57 million by 2015. On another hand, according to the Audit Bureau of Circulation, The Wall Street Journal currently sells approximately 2 million copies of its newspaper everyday. That is less than 10% of the iPad market, and in 2015 it will be less than 5%. Even if it’s a specialized and targeted news source, just imagine how much readership could grow!

The same goes for magazines. Take something with a more general subject like Readers Digest, for example. In 2010, circulation of this mag was around 5.5 million, according to the Audit Bureau of Circulation. The iPad market is 5 times that amount... and it’s going to get a lot bigger!

To conclude, publishers need to move swiftly in order to be present in as many iPads as possible, by offering cheaper subscriptions and better content. I think this is the light at end of the tunnel for the publishing industry. What do you think?