When Apple launched its iTunes subscription service last month, content providers didn't greet the move with open arms. That's because Apple takes a 30% cut of sales, doesn't share customer data for subscriptions sold via the App Store and requires publishers not to sell subscriptions for less on their own sites.
Nevertheless, when The New York Times unveiled its long-awaited digital subscription plan Thursday, it revealed it would sell access to its iPhone and iPads through iTunes, under the new terms. The iPhone app is bundled into the basic $15 monthly package; getting the iPad app with online access costs $20 a month; and an "All Digital Access" package is $35 a month.
So obviously the Times has decided that it's worthwhile to go the iTunes route despite conditions other publishers have balked at. But, putting aside whatever financial calculations went into the decision, it's not hard to see why the Times did so. A key to any subscription service is to remove as many barriers as possible to people signing up. By giving the millions of people who already have iTunes accounts the ability to subscribe via 1-click purchase (by June 30), the Times is making it easier for readers to get on board.
What's more unappealing than clicking through to a site only to be faced with a registration page to access content? By allowing iTunes customers to avoid that process, the Times can potentially sign up more people than it might have been able to otherwise. That seems to be the bet the company is making.
In response to an inquiry, a Times spokesperson said today that the company based its digital subscriptions on extensive surveys with users showing that they wanted access from multiple platforms. The research also indicated the heaviest users own smartphones and tablets. So converting that core segment to paid users is critical, and allowing them to subscribe through iTunes will help smooth the way.
Charging $5 more a month for iPad access, though, looks questionable. For the sake of simplicity, and to provide another sweetener, it might have been better to include the Apple tablet in the basic offering. Times digital chief Martin Nisenholtz told All Things D the company found a "greater willingness to pay among iPad users" who spend much more time than either Web or smartphone users with the Times.
The Times' subscription plans also work with Android and BlackBerry-powered phones. When it comes to access on the growing field of iPad competitors, the Times said it's still evaluating the latest platforms and tablets. At launch, it's also not able to connect NYTimes.com access to Times subscriptions people already have on e-readers like the Kindle or Nook. But the company said it plans to enhance its e-reader subscription options soon. The sooner the better, since offering a consistent, seamless experience across devices will be important as the Times starts to charge for access across a variety of devices. People aren't as forgiving when content and services aren't free.