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Who Is Making Money ‘Now’ in the App Store Subscription Era?

Friday, August 19, 2011

Now that the subscription model for fee-based content in the Apple App store has been embraced both by Apple and by most of its major publishing partners, we wondered who is making bank.

It looks as if the new model is paying off for content. In fact when we did our last spot check the Top Grossing Apps in the iPad section of iTunes back in January, the highest ranking publication we found was People at # 34.

When we look at iTunes today, and after months of subscription sales, we find multi-title digital magazine distributor Zinio not only in the lead but actually making the #3 slot, right behind Apple’s own word processor Pages and Smurfs Village. "Our goal was to out gross those Angry Birds, which we did and that makes us happy," says Jeanniey Mullen, global executive VP and chief marketing officer, Zinio. The top purchases of digital magazines within the Zinio app vary according to release schedules, but Mullen tells us bestsellers have included at various times, National Geographic, Outdoor Photographer, Macworld and Maxim. And that is in the U.S. market only. Zinio is also the top grossing news app in most other countries as well, she tells us.

According to the App Store, single issue sales are driving the success, as they constitute the top seven in-app purchases. Zinio just had a major upgrade of its iPad app, which introduced a much improved interface for shopping magazines. Most of all the new 2.0 Zinio app now features articles from the magazines on the newsstand for real content sampling. Mullen says that the high rank reflects the popularity of the new release. "What you are seeing now in 2.0 is just the beginning. We have just submitted 2.1 and a whole series of continuous enhancements will be coming throughout the next few months," she says.

Elsewhere on the list, however, we also see standalone apps from People, The New Yorker and Oprah's O magazine among the top grossing titles.

Top Grossing News and Magazine Apps in iPad App Store

#3 Zinio
#12 New York Post
#13 The Daily
#19 Comixology
#24 People
#26 Marvel Comics
#42 The New Yorker
#65 NYTimes for iPad
#72 O the Oprah Magazine
#73 DC Comics
#85 GQ
#86 National Geographic
#97 Vanity Fair
#105 Popular Science
#115 Wired
#118 Popular Mechanics

All the usual caveats apply to taking the iTunes rankings too seriously. Exactly what span of time they cover is never very clear, and the results may very well be different by morning. Our snapshot was on the evening of Aug. 18. But clearly the introduction of the subscription model has had a demonstrable effect on the rankings of major media titles in the overall measure of app income.

Updated: As some of our readers have pointed out this morning, quite rightly, and we indicated above, the top grossing app list is ever-changing. In particular for the magazine industry, individual titles will rise and fall on the list throughout the month relative to their new issue release cycles. Overall, however, and even with these variations, the subscription model for periodicals has lifted all boats, in that media publishers now occupy consistently higher rankings among top grossers than they did before Apple's policy change. Now, in fact, general media do challenge Angry Birds.  

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