Date

Mon - 20.11.2017


Newsstand sales give Future a boost: but is it enough?

Newsstand sales give Future a boost: but is it enough?

Magazine publisher Future PLC, which puts out publications such as Total Film, Classic Rock, released its interim financial results yesterday, and revealed that it has seen a 48% rise in digital revenues in the UK in the six months leading up to March 31, partly thanks to the boost it has received from Apple’s Newsstand. But although its digital income was up 37% over this period, losses in print meant that the company’s overall revenue still dropped 4%.

In its financial report, Future strongly pushes its success on the iPad. Since the Newsstand was launched in October last year Future has made sales on the platform with more that £3 million. It has sold more than 830,000 copies of its magazines through Newsstand, with 45% of those sales coming being subscriptions. Encouragingly, the Future writes that 90% of subscribers are new customers.

Future’s CEO Mark Wood comments in the report that “Future is seizing the opportunities offered by new platforms and channels to reach new audiences and grow a global digital business.” He states that, “on Apple's iPad, Future is one of the world's leading digital publishers in sales volumes and number of titles. That is a sign of how far we have come in a very short time."

Future also plugs its overall digital growth. It states that its digital advertising revenue now accounts for 44% of the total money that it makes from ads and writes that its UK digital revenues are up 1%, with digital gains outstripping print declines.

But this doesn’t change the fact that the company has seen its revenue drop by 4% in the six months proceeding March 31. According to the company’s normalised results, which exclude the costs and revenues from business that Future has closed or sold between October 1 and March 31, the publisher’s revenues fell from £61.5 million to £59.1 million in this period. Revenues in the US dropped by a whopping 20%, although the company states “this decline was not unexpected and has been largely offset by reductions in the cost base.”

Will success on the tablet be enough to help Future grow again overall? The company is clearly very confident about the possibilities that Apple’s iPad offers. “The rapid evolution of the tablet - spearheaded by Apple's iPad - is creating an entirely new market for digital products. Importantly, it is one in which consumers are prepared to pay for content. Tablets first went on sale two years ago but the market is expected to reach over 940 million devices by 2015. It presents an enormous opportunity for Future,” states the report.

However, Mathew Ingram suggests in an article published earlier this month in GigaOm that not all publishers share this optimism. Ingram notes that, when it comes to publishing apps, some media companies find that the “benefits don’t outweigh the negatives.” He highlights publishers’ grievances about Apple taking a 30% cut from Newsstand sales, which “in some cases removed any upside to selling content through the device at all.” He also argues that often the revenue that comes from iPad sales often makes up a relatively small percentage of a publisher’s overall income: “The Economist is doing better than many others with its digital edition: according to a recent report from the company, the magazine had about 50,000 subscribers to the iPad version in March. But AdWeek notes that this still only amounts to about 6 percent of total circulation — and that is among the highest levels in the industry,” writes Ingram.

Ingram refers extensive to an article by Jason Pontin, the editor-in-chief and publisher of Technology Review, who writes, “A recent Nielsen study reported that while 33 percent of tablet and smart-phone users had downloaded news apps in the previous 30 days, just 19 percent of users had paid for any of them.”

Perhaps Future’s recent results show that publishers can make good money from app sales on the iPad. But maybe the question now is whether that money will be enough?

Sources: investigate.co.uk, Journalism.co.uk, Press Gazette, Giga Om, Technology Review 

Author

Hannah Vinter

Date

2012-05-23 13:10

Shaping the Future of the News Publishing


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