Wall Street Journal's Partnership With Apple Marks Shift in Strategy
26 Mars 2019 - 01:03AM
Dow Jones News
By Lukas I. Alpert
The Wall Street Journal is a launch partner for Apple Inc.'s
$9.99-a-month news service, marking a significant shift in strategy
meant to draw in new readers and paying subscribers without
undercutting the publication's core business.
Apple unveiled the news app, Apple News+, at an event Monday. It
will provide access to articles from more than 300 magazines
including Vogue, GQ and Sports Illustrated. In addition to the
Journal, the Los Angeles Times and Toronto Star will be the other
North American newspapers joining the service.
Apple will take a substantial cut of the revenue -- it was
seeking a 50% share in talks with publishers, people familiar with
the discussions say. Media partners will get a portion of the
monthly fees based on readership of their stories.
Journal executives declined to comment on the terms of revenue
sharing.
Other major news outlets including the New York Times and
Washington Post engaged in talks with Apple, people familiar with
the situation said, but chose not to join the new service.
The Journal for years has focused on building its digital
subscriber base, appealing to a core audience of people interested
in business and financial news. The paper finished 2018 with 1.71
million digital subscribers, with a full-priced subscription
costing $39 a month. Its print subscribers totaled about 840,000.
The Apple partnership is viewed as an opportunity to bring in
revenue from a broader audience.
William Lewis, chief executive of Dow Jones & Co. and
publisher of the Journal, said at a meeting for newsroom staff that
the deal "will enable us to get our journalism in front of millions
of people who may never have paid for our journalism before."
Robert Thomson, chief executive of Journal parent News Corp, has
been among the most vocal critics of tech companies such as
Alphabet Inc.'s Google and Facebook Inc. He said the Apple deal was
a measured and smart bet. "It's important that we partner with tech
companies when that makes sense" and "pursue them" when necessary,
he said at the newsroom meeting.
The partnership carries risks for the Journal, since each Apple
user will generate much less subscription revenue for the company
than a full-priced subscriber. Journal executives said they weren't
concerned about existing subscribers canceling service to shift to
the Apple service, because the two offerings will be fundamentally
different.
The Apple app will surface stories thought to be of interest to
a general reader -- that could be national news, politics, sports
and leisure news, but also some business news, people familiar with
the situation said. The paper's entire slate of business and
financial news will also be searchable within the app, but the
thinking is that most users won't consume much beyond what is
actively presented to them.
Apple users will have access to only three days' worth of the
Journal's archive, the people said. The Journal also negotiated
terms that would allow it to drop out of the service, they
said.
"I have not entered into this deal lightly," Mr. Lewis said in
his newsroom talk. "It was never worth doing a bad deal."
Apple didn't immediately respond to a request for comment.
Mr. Lewis said the shift by the Journal was a milestone as
significant as the launch of a paywall on the Journal's website in
1996, more than a decade before most of the news industry.
To meet the needs of the Apple product, the Journal will be
hiring around 50 additional newsroom staffers, the people familiar
with the situation said.
While Apple won't share customer data with the publishers,
participating news outlets will be able to see what is being read
and target regular visitors with specific offers for things like
newsletters, said Suzi Watford, the Journal's chief marketing
officer.
The Los Angeles Times is also hopeful that the Apple partnership
will jump-start its digital business.
"We have every confidence that the Apple affiliation will spur
the growth of our digital subscriptions," said Patrick Soon-Shiong,
owner and executive chairman of the Times.
Write to Lukas I. Alpert at lukas.alpert@wsj.com
(END) Dow Jones Newswires
March 25, 2019 19:48 ET (23:48 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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