News platforms rather than individual publisher offers – optimism in the field of digital publishing

What’s behind the Apple App News, Instant Articles of Facebook, the Google News Digital Initiative (DNI) and startups like Blendle?

Until recently, publishers in the digital domain have tried to tie their print business model to ratio of 1:1. However, few publishers have actually benefited from this strategy, as monetization does not transfer well to the digital world. While buying newspapers and magazines at a newsstand comes naturally, a paywall on the web or mobile devices becomes a knockout blow for many readers. For the majority of publishers, the sales of advertising space are the only way to monetize, and that is why publications need coverage. This can only be achieved once they are perceived and appreciated outside of their target group. Until now, this was the main reoccurring problem that publishers could not solve.

After a long standstill, this issue has now been recognized and tackled ambitiously by several players. Apple, Facebook, Google, and a number of startups have started pilot projects to provide common platforms for contents of various publishers. A central point of all platforms is the unbundling of news. Here, individual articles and not the entire publications are placed into focus.

Basically, all the offers are created in a similar fashion: publishers have the ability to provide single articles for a news platform that is available as an app. Thus they also serve the mobile device market, which until now has been rather neglected. The mobile first approach could never really prevail in the publishing world. Platforms that can be used on all channels play into publishers’ hands perfectly.

Moreover, there are substantial advantages for readers: they can choose between articles from different publishers and can select or exclude specific offers through personalization. This is exactly what RSS readers have been offering for some years already.

Thus, the question we are asking is what differentiates the Apple App News, Instant Facebook Articles, Google News Digital Initiative (DNI) and startups like Blendle?

Apple News App

Two weeks ago, the new Apple News app was announced at the annual WWDC 2015 developer conference. The News app is to completely replace the Newsstand app. The focus has shifted from the bundled publications of a single provider to a wider range of articles available from different sources.

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Users can create a personalized magazine from various sources in the News app. As with RSS readers, an individual magazine is automatically generated based on the selection of preferred media and topics, comparable to what Flipboard has been widely popular for. The publications are individual articles, which publishers publish in the News app. According to the Developer FAQ, every blogger can integrate his RSS feed and thus easily become a publisher.

However, partners have the opportunity to create their own layouts, and equip it with photo galleries and videos. The Apple News and Facebook Instant Article have already introduced The New York Times as a partner. As might be expected, the featured articles look quite similar to each other. This is, without a doubt, in the highest interest of publishers who stand out with their own style and thus strive to be recognized on different platforms.

However, bloggers have already expressed their criticism regarding the fact that their RSS feeds are automatically added to Apple’s newest app.

For now, the app will be available in English in the US, UK and Australia. Apple senior vice president Eddy Cue commented in the press release: “We already have nearly 20 publishers representing more than 50 titles joining us, including Condé Nast, ESPN, The New York Times, Hearst, Time Inc., CNN and Bloomberg,”. It is still unclear when the app will be available for the German market.

Another central point still in the dark is the monetary advantage for participating partners. From the Developer FAQ it can be inferred that partners will be able to integrate banners. Thus, 100% of the advertising revenues should go to publishers. Empty areas will be assigned with iAd ads, Apple’s own advertising platform. In this case, publishers should still receive 70% of the advertising revenues.

Not only publishers, but also users should benefit from the switch from Newsstand to Apple news. The new app will not collect any personal data, thus protecting the privacy better. In addition, users will be able to share articles in different channels outside the app.

 

Facebook Instant Articles

Facebook’s Instant Articles caused plenty of stir in the media world, as it announced that users will be able to read articles via the built-in streaming solution without leaving Facebook. Until now, users had to click on articles and were then redirected to external sources, thus leaving Facebook application.

Facebook is, however, faced with an existing problem regarding the quality of news links. ‘Click-baiting’, web content filled with headlines that aims at generating online advertising revenue through clicks at the expense of quality and accuracy, leaves users frustrated. Spammy stories drown out content from users’ friends and the pages that they actually care about. By integrating entire articles to Facebook feed, sensational headlines without quality content will therefore be transparent and should, as a result, diminish.

Instant Articles is a platform where publishers can appoint individual articles. Here publishers also have the opportunity to influence the layout of articles. However, Facebook has pointed out that attractive articles will appear even without the cooperation with publishers.

As with Apple’s News App, publishers can integrate advertising, from which the proceeds will go to publishers. Empty areas will be extended through Facebook’s Audience Network. Unlike with Apple News, articles will, for the time being, only be sharable on Facebook.

The success of Instant Articles remains to be seen. As of May 13th, no new first partner articles have been published.

 

Blendle, Pocket Story, Readly & Co.

In addition to the major players, there are other startups that have taken on the task of solving the problem of monetizing the editorial content on the Web.

TijdlijnDuitsBlendle, a news app with micropayment functionality, was created by two Dutch students, who managed to win over the hearts and money of big media players within a very short time. Two publishing powerhouses – Axel Springer and the New York Times – already invested $3 million in the small startup.

A platform for publishers also plays a vital role in Blendle. This concept has even been deemed the “Netflix for journalism”. However, here articles are monetized directly. After readers download the app, they pay a small fee for every article they want to read. If they do not like the article, readers have the opportunity to reclaim their money. Until now, Blendle in Germany partners with Bild, Die Welt, Naitonal, der Spiegel, and die Zeit.

Blendle is not the only startup with a similar concept in the game. Pocket Story pursues the same strategy as Blendle, but on the web instead of the apps. Readly, on the other hand, relies on a monthly flat rate for all offered content. However, it uses PDF replicas of magazines that are actually designed for print, and this makes it inconvenient for reading. Without parallel controls, users might not appreciate the service so highly.

Moreover, a question arises whether these services can establish themselves against those that offer free content, such as Apple and Facebook. So far, taking mobile and web readership into consideration, the willingness to pay for digital content is still rather low. Another concern is whether readers will actually prefer to access news through an external platform that is neither social media nor a newspaper website. Reuters Institute for the Study of Journalism (RISJ) in its 2014 report revealed that many people prefer to access news via social media instead of directly accessing websites or search engines.

 

Google News Digital Initiative (DNI)

Earlier this year, Google attracted significant attention by announcing to invest 150 million euros in the future of digital journalism. Google founded the so-called Digital News Initiative -DNI – together with 8 publishers and 3 publishing and journalistic organizations from Europe. The main aim of DNI is to develop and try out new publishing formats. Meanwhile, new partners have already joined. Members decide together which projects should be funded and moreover work closely with Google’s product development, which should lead to exhausting all technical possibilities.

One of the reasons for Google’s initiative is certainly the continuing dispute over performance rights between the major publishers and Google. In April of this year the E.U. accused Google of misusing its 85% market share in Internet search. Moreover, in the U.S. Google have had problems with Google News, as it diverted readers away from content behind firewalls, weakening the publishers’ ability to monetize their products. The Guardian summarized the hole problem in an article.  With this program Google could position itself vis-à-vis publishers as a strategic partner.

After the first three months of the Google News Digital Initiative, no reviews are so far available, and no projects have sprung from the initiative. One conceivable option would be, for example, to enable virtual reality for digital storytelling. All in all, we are excited to see the first results.

 

Publishing methods will change significantly

Apart from offering decentralized individual products on platforms, publishers continue to test new ways to monetize their own offers. For one, they use services such as Pay Later, Flattr, Pay with a Tweet and Pay Pal as micropayment systems. Moreover, they also increasingly test paywalls for “VIP” content. However, financing through advertising, and particularly the incorporation of native advertising continues to evolve.

All these changes and initiatives change the demand of the generated content and, therewith, the way in which they are produced. Ideally, an article should be produced once and then automatically published throughout all the desired channels. The independence of production is an important prerequisite for qualitative and free journalism. Digital Publishing Suites can help you to produce content suitable for the media and moreover to quickly adapt to new circumstances.

Contact us, if you would like to find out how you can customize your workflow simply, and thus benefit from the new means of distribution and monetization.

We would like to ask you what you think about the changing publishing methods of digital publishing? Do smaller startups and their apps have the potential to withstand the big players? How will the readers’ consumer behavior change? Are you willing to spend money to read your preferred articles online? Feel free to leave your comment below.