Reports are circulating regarding Apple’s plans to offer newspaper and magazine subscription services over the iPad platform giving many “old media” outlets (newspapers/nagazines that have been struggling in the recent past) a new channel to deliver their content.
http://ecommerce-journal.com/news/29750_apple%E2%80%99s-ipad-news-sub-servicell-send-papers-digital-delivery-platform
The brief article (a follow up to a story I first heard reported on WBZ radio but is now being picked up by other news outlets) reports that Apple’s planned cut could be as high as 30% and 40% of subscription fees and advertising revenue respectively, to allow the publishers of this “old media” a very desirable channel to Apple users.
It would appear that Apple is looking to the 90% of total global advertising spending that is currently not on-line (and thus not in Google’s sights yet), making a bet on which aspects of that ad spend will go on-line when, and making a play to influence how it will go on line in a way that is profitable for Apple, and possibly less profitable or not profitable at all for Google.
Google appears to be the dominant force in on-line advertising right now, and their financial statements and investor information shows that they are very good at providing a venue for on line, search based advertising.
While many analysts and pundits seem to agree that on line advertising will grow significantly, the question is often how. And will it grow in a search based way, adding more spending to Google’s primary market (and likely adding more revenue to Google’s financial statements?) or will that growth in on-line advertising materialize in a different way (perhaps delivered via apps /content desired by the user, or by another method)? Already some “free” services have ads interspersed such as Hulu and Pandora to which Google has no direct link.
So the question is, how will advertising grow on-line, and can Google react if ad spend switches to something other than a search centric model?
No comments:
Post a Comment