• Bloomberg, Monday, September 20, 2010 12:40 AM

Apple Inc. is developing a digital newsstand for publishers that would let them sell magazines and newspapers to consumers for use on Apple devices. The newsstand, designed particularly for the iPad, would be similar to Apple's iBook store for electronic books, but separate from Apple's App Store, where people can buy some publications now.

Apple's effort is aimed at luring more consumers to the iPad and helping publishers sell subscriptions, rather than single issues. The main hang-ups between Apple and publishers including Time Warner Inc., Conde Nast, Hearst Corp. and News Corp. are who controls data about users and how to split subscription revenue. Pricing for subscriptions also hasn't been worked out.

One challenge is that publishers prefer to control subscriber data and revenue, said Ken Doctor, an analyst with Outsell Inc. in Burlingame, California. Apple is trying to insert itself as a middleman that doesn't exist in other industries, said Doctor, who is not directly involved in the talks. For example, Sony Corp. doesn't demand a cut of the revenue from television shows on its TV sets, Doctor said.

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