Tim smith evening standard

Are Apps the Saviour of the Publishing Industry? 1 June 2010 Tim Smith General Manager, Digital 020 7938 7722 Tim.smith@standard.co.uk

The Challenges Facing Old Media

The challenge facing analogue publishers • Businesses that have made huge sums for years via mass communication in print now having to navigate a hugely changed media universe • Publications changing hands or re launching to face up to the greatest challenge of their lives • Metropolitan dailies in the US, one a week going into bankruptcy or cutting way back • Digital Revolution • This is drying up their life blood = Advertising and Circulation revenue

The response of some publishers has been a move to free model • Evening Standard sold by Associated Newspapers to an individual named Alexander Lebedev • Growing sense of entitlement in the minds of consumers around content being for free

The Challenge of Maintaining Paid for Circulation April June 778,273 781,744 (+0.3%) 789,995 (+1.5%)

Essence of Evening Standard Strategy • Commercial Imperative to have a long term sustainable model • Retain the character of a paid for Newspaper • Premium content = quality audience • World’s first quality free newspaper • Investigating which other channels offer promise – getting interested in devices

Revenue Models

Mobile Applications • Previous generation = price wars and battles for celebrity scoops • New battle happening in reader’s pockets • All the big news groups are investing in downloadable smart phone applications • New readers, direct revenues and advertising spend • Could mobile apps be the answer to finding a sustainable future for publishers ?

Uptake of Smartphone Apps ComScore data from 2009 showed that: • 23 per cent of all UK mobile phone users had a Smartphone, and 3.5 per cent an iPhone • 80 per cent of iPhone users and 48 per cent of smartphone users access news via their device • Some 56 per cent of iPhone users and 22 per cent of smartphone users had downloaded an application to access News • More smartphone users had used their phone to read news than had done so to access email(35 per cent), listen to music (40 per cent) access a social networking site (29 per cent) or find out about the weather (26 per cent)

Paid for Content • Only FT and Times charging to access their web content • Most of the other publishers have no such shyness when it comes to mobile applications • Smart phone users are prepared to pay. One piece of research shows that Apple App stores 56 Million users spend an average of $10 (£6) per month on apps – of which one third retained by Apple

Case Studies

Direct Payment - Guardian • 70,000 downloads in the first month • £167,000 gross revenue in first month • Excellent navigational structure and ability to tailor the parts of the paper that you want to read

Direct Payment – Guardian • More paid for niche apps planned • “Your website is not necessarily going to be the fastest growing way that people access your content, we definitely think that it is going to be device driven” • “It’s a new revenue stream but I’m cautious of saying that apps are the saviour – we all remember the crest of the wave that was WAP” Emily Bell, GNM

Free to User – Sky News • It used to live off other things we did, a by-product. But now its increasingly becoming a core publishing platform, there’s no doubt in my mind, it’s a big growth area • “We’d sooner have 1 million iphone users with a free app than 10,000 of a paid one” • Key focus revenue generation via ads and sponsorship • Also works hard to promote Sky’s subscription marketing campaigns

Evening Standard

Evening Standard • Free to user – mirror print strategy • Developed by Handmark • Commercial model – revenues from sponsorship and advertising • Features include share to social networks, mini picture galleries and widget (android) • Plan to launch with relatively simple application and then develop over time

Case Study – Evening Standard • Sponsor deal with British Airways • Sold by ES in house sales team bought by Zenith • Multi platform opportunity key • Deal includes sponsor mention in press and online ads to support launch • Creation of city guide to find out more about destination cities

Case Study – Evening Standard • Press ads to support Nokia Ovi launch • Full page placed in Times and City AM

Insights

Insights • Users are heading towards devices and so publishers have to be where the audience is or they could lose out • Can lead to renewed profits either by direct payment or by sponsorship and ad funded models (most publishers will have a mixture of both) • Convenience is king. Some research from Forester is suggesting that many users are more interested in the convenient delivery of content, even over actual quality of stories • Not just about iPhone

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Tim smith evening standard

by James Cameron on Jun 09, 2010

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