Top 5 iPhone Revenue Ideas Magazines Should Steal

By Steve Smith

If you have been following along this week at minonline, then it should be clear by now that the Apple iPhone has been attracting a lot of love from the magazine industry. Both Seventeen and Runner’s World released similar shopping apps for their respective audiences on the device. Publishers that haven’t sipped the Apple Kool-Aid often complain that the platform gets inordinate attention considering that barely 10 million people in the U.S. own an iPhone. But as Seventeen editor Ann Shoket told us this week, you can’t count just the iPhones when almost as many iPod Touch models are in users hands and are also capable of running iPhone downloadable applications. More than 37 million Apple devices worldwide now run these apps.

Sorry to disappoint the skeptics, but truth be told, the iPhone is wiping up the market. According to Gartner’s latest stats on phones sold worldwide in the second quarter of 2009, Apple’s share of smartphones grew by 375%, and now sells 13.3% of all units in the category. But more to the point, the iPhone mobile content model has permanently reconfigured the market. Whether it is RIM BlackBerry, Google Android, Nokia Symbian or Windows Mobile, the basic model for mobile app design and distribution likely has been established for the next several years…by Apple. In other words, the apps a publisher develops here will ultimately reach its peak audience when they proliferate across the major smartphone and even high-end feature phone platforms. But make no mistake, with the exception of a few apps that have launched first on the BlackBerry, most apps will appear first on the iPhone for the foreseeable future or launch on both in close proximity.

But what are magazines missing? We applaud some of the recent branded media apps from People, Seventeen and Runner’s World because they move beyond merely extending the magazine to the handset. They find utility or focus on a narrow range of content that people mainly want on the road. But what are the magazines missing? What can they learn, swipe or steal from the other apps on the platform that are charging users successfully? Here are our best candidates for adding cash value to your magazine app.

Games: Given the staggering success of some pay-to-play games in the App Store ecosystem, we don’t quite understand why publishers of other kinds of content haven’t figured this out. Simple word games like Word Warp and highly addictive time killers like Paper Toss (throw crumpled paper at a wastebasket) successfully draw either small fees or ad revenue. Both USA Today and the New York Times have separate fee-based apps for their crossword games. Wouldn’t a Car & Driver racing game or an Entertainment Weekly or TV Guide entertainment trivia game sell? Why not embed a game in an app to add value or help justify a fee?

Comics: One of the hottest categories of books in the App Store is the comic, both strip forms and single-panel. Both formats are perfect for the iPhone, and fans are paying by the issue for reprints of classic comics and Japanese manga. If The New Yorker ever comes to the iPhone as an app, it would be crazy not to upsell the weekly cartoons for an incremental charge. If Slate gets an app, one of its main draws could be its reprinting of hot political cartoons and Doonesbury. Publishers should think about partnering with the syndicates to bring this format to mobile. It is the one case where the phone actually presents the medium in a larger, more pleasant way than most print iterations.

Freemium Content Rationing: Steal this idea from Financial Times, which is already limiting users of its free app to seeing three articles in every 30-day cycle before being forced to pay for a full subscription to the brand. Not many content brands could pull this off, but FT is offering an enticing proof of concept. If a user has tried to click through on content from a publisher more than three times in a month, isn’t he demonstrating to himself the value of this specific news brand? The model lets the user make the case to himself for paid content.

The Audio Channel: This is one area of app content development that tends to remains in a silo apart from text, images and video. Audio books and podcasts are among the most popular uses of the iPod, and few publishers have leveraged this appeal in their own apps. Why aren’t branded media feeding their podcast material into their apps when it adds so much value and variety? Users already pay $1.99 to $30 for audio books in the iTunes Store. Wouldn’t they pay a 99 cents upsell for the audio interview your staff had with a major political figure or celebrity? With such a robust portable multimedia channel now open to publishers, shouldn’t magazines be partnering with audio book publishers to offer audio excerpts of reviewed books that link into a purchase opportunity?

Stupid Little Tchotchkes: The dumbest phone antics are among the most compelling to users who are looking for a bit of drive-by fun. Zippo’s virtual lighter has been downloaded 5 million times, and someone in that company must regret they didn’t charge 99 cents for it. “Soundboards” like the Star Wars app pictured here simply grab audio bites from the classic film series for users to play back anywhere. “I am your father,” “We’re doomed!” and the familiar screech of a TIE Fighter are irresistible. One thing missing from media apps is this bit of phone-friendly whimsy, such as a sound effect of the day or an audio film quote of the day. Or how about a quick audio or video grab (much like E!’s Talk Soup or Daily Beast’s video round-up) to give the user a bit of multimedia candy that brings them back every day?

The mobile application model has opened up a gusher of creativity. The catalog is filled with great ideas that some people are willing to pay for but not enough users ever get to see. The thousands of apps now cluttering the store pose a problem for any new idea. How do you get above the noise? Media brands like People, Epicurious, USA Today, Sports Illustrated, etc., have already shown they can pop through the clutter. Major media should incorporate into their apps and mobile strategy some of the novel notions that are attracting revenue and loyalty from users in this emerging platform. This is how magazines move beyond “extending their brand into mobile” and start extending mobile into their brands.