News outlets ask Apple how to land lower fees

A group of news publishers has sent a letter to Apple CEO Tim Cook, asking what they need to do to access the same preferential fee structure as Amazon on the app store.

Currently, they pay Apple 30% of first-time subscriptions, dropping to 15% after the first year.

Biting back: Digital Content Next is not the first group to take on the might of Apple.  (Source: Maria Teneva on Unsplash
Biting back: Digital Content Next is not the first group to take on the might of Apple.
(Source: Maria Teneva on Unsplash

Apple claims this covers necessary operating expenses and is similar to charges elsewhere.

E-commerce giant Amazon meanwhile has apparently negotiated a reduced 15% rate across the board. These kinds of deals are on the telco and cable radar more prominently these days, as so many CSPs are either moving into the media business or looking at bundling or other options to diversify their services.

Request in writing
Digital Content Next, the group behind the letter, is a trade body that counts the New York Times, the Washington Post and the Wall Street Journal as members, among others.

"The terms of Apple's unique marketplace greatly impact the ability to continue to invest in high-quality, trusted news and entertainment particularly in competition with other larger firms," wrote Jason Kint, CEO of Digital Content Next, who signed the letter.

"I ask that you clearly define the conditions that Amazon satisfied for its arrangement so that DCN's member companies meeting those conditions can be offered the same agreement."

The letter references an email sent by Apple executive Eddy Cue to Amazon CEO Jeff Bezos which lays out a 15% revenue sharing deal for Prime Video subscribers, reports the Wall Street Journal.

The email was previously mentioned during a House Judiciary Committee hearing in July.

Tipping point
It's a crucial moment for news outlets, according to the Reuters Institute for the Study of Journalism's Digital News Report 2020,

"Journalism matters and is in demand again," writes Nic Newman, a senior research analyst, in the foreword.

"But one problem for publishers is that this extra interest is producing even less income – as advertisers brace for an inevitable recession and print revenue dips."

Want to know more about 5G? Check out our dedicated 5G content channel here on Light Reading.

The irony of course is that key drivers of this new enthusiasm for proper reporting are also the factors draining the revenue pot – fake news and COVID-19.

The letter comes in the same week Facebook criticized Apple for refusing to drop fees for small businesses running paid for events via their app – and hot on the heels of game developer Epic Games Inc's epic battle with Apple and Google over the game that spawned a thousand flossing gifs, Fortnite.

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Fiona Graham, editorial director, Light Reading

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