Tuesday, February 8, 2011

Expect news media to lose control to Apple

I couldn't write it better myself, so here's a link to a post by The Economist warning that traditional published news media could lose control to Apple in the way that music publishers did after the introduction of iTunes. With the US launch of The Daily Apple takes 30% of the 99c weekly subscriptions.

At a weekly cost of production of $500k The Daily will need a little over 721k subscribers to break even, after Apple's cut. Can they do that? Probably very easily at a price of just 99c in a market exceeding 250m potential readers. And with gross revenue at that break-even point exceeding $200k per week this will be a good business for Apple!