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Apple’s App Store Subscription Revenue Rises 74%

Why is subscription revenue falling for print publishers and rising for app store subscriptions?

While publishers are all fighting for their subscription lives, Apple’s over here seeing subscription revenue up 74%. While much of this revenue applies to app subscriptions for video subscriptions, games and software products, it does also include magazine apps. The top apps were Netflix, HBO Now, Line, and Tinder.

TheStar.com reports, “Apple’s App Store generated $2.7 billion in subscription fees for 2016 — an increase of 74% from the year earlier…Overall, Apple says, it paid app developers over $20 billion in 2016, up 40% from 2015. According to the company, since the App Store launched in 2008, developers have earned over $60 billion.”

Consumers are telling us loud and clear what they want—are you listening? How much would you pay for that information? Download a copy of our 2018 Mequoda Magazine Consumer Study for FREE instead, to find out how you can improve your digital magazine rapport with subscribers.

In the past, we have talked a lot about Apple’s 70% remit rate. We consider it a generous percentage compared to other app stores considering the magnitude of their marketplace, which now has 2.2 million apps. However, in September 2016, Apple updated their terms so that subscription-based apps, like magazines, receive a remit rate of 85% after 12 months. That’s a pretty good deal.

According to the article, “Apple said Jan. 1, 2017, was the biggest single day of sales ever for the App Store with nearly $240 million in purchases, which came after it generated more than $3 billion in December — its best month to date.”

Would you like to get a piece of that pie? I imagine you do. And as consumers begin to adopt digital magazines, the day isn’t far off when a larger chunk of this revenue goes to publishers. If you can incorporate a video series or some type of gamification into your magazine app, your chances will go even higher.

Does a digital magazine need bells and whistles? Well, reading a publication, whether in print or digital media, has always been a hands-on activity. Printed media is interactive because individuals may engage in conversations where they verbally share what they’ve learned from the editorial content they’ve read. In addition, printed magazines provide its subscribers some play, with crossword puzzles, quizzes, and other brain teasers.

When designing a digital magazine, participation is taken to the next level. Some digital magazine apps offer the crossword puzzles on their tablet or smartphone, other apps play videos, others have playlists, games and most have clickable ads. All have heightened the interactive process between the content and the reader.

If digital magazine apps want to be taken seriously, they should be seeking to offer outstanding and hands-on experiences that further invest subscribers. Otherwise, why make an app?

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