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While the Internet killed the generations-old business model for traditional media, publishers are betting that Apple's "iSlate" tablet computer will lead to its recovery.
On January 27, Apple will unveil its "latest creation", widely expected to be a 10-or-11-inch touch screen tablet computer. Just as the iPhone and the iTunes App Store created new business opportunities for game and mobile application developers, newspaper and magazine publishers are hoping that the iSlate will similarly transform their beleaguered industry.
"Both the iPhone and the Kindle have proven that people are willing to buy the devices, read on the devices, and pay for content," said Greg Hano of Bonnier Technology Group, which publishes Popular Science and other notable titles. "We already have a proof of concept,"
For more than a decade, the vast majority of magazines and newspapers have been freely available to consumers on the Internet. Lost circulation revenue combined with a prolonged economic downturn is now leaving these traditional industries on life support. An optimistic prospect is that the iSlate and other tablet computers introduced by Microsoft, Hewlett-Packard and Lenovo will create new media experiences consumers are willing to pay for.
"There is a lot of hope that we will be able to import the subscription model to the tablet device," said Philippe Guelton, COO of Hachette Filipacchi Media, publisher of several titles including Elle and CAR and DRIVER. "We have a huge opportunity to offer premium content and go much deeper that we could on the web."
Consumers already paying for iPhone apps
The overwhelming success of Apple's iTunes App Store illustrates that consumers are willing to pay for digital content that is presented differently than what is found on the web. Games, while still the clear leader, are not the only paid iPhone apps generating meaningful sales. In recent weeks, iconic titles including GQ, Esquire and (a fully clothed version of) Playboy Magazine have experimented with distributing individual editions for as much as $2.99.
Zinio, a digital publishing technology company, earlier this year released an iPhone app that carries electronic versions of 14 (and counting) publications on that device. The free eReader application makes it possible to consume the same magazine on multiple devices while only paying for one download. Of course, it isn't just fate that the Zinio iPhone app was released a few weeks before Apple's big announcement.
"Publishers are going to want to design for different screen experiences," said Zinio Chief Marketing Officer Jeanniey Mullen. "With small screens, you are not going to read cover-to-cover. With mid-sized screens, you will be looking to sit down wherever you are a page through the device."
Apple as market maker
Just as MP3 devices existed before the release of the first iPod in 2001, tablet computers long predate the iSlate. What makes Apple's device different from other "netbooks" is the ease in which developers and publishers can create new experiences for consumers.
"At the end of the day, it's the applications that drive interest in the hardware," explains Colin Crawford, who used to run Macworld and now advises digital publishers as CEO of Media 7 Consultancy. "Apple has the audience and the distribution to make it worthwhile for publishers. The biggest challenge is discoverability."
Andy Ihnatko, technology pundit and author of iPhone: Fully Loaded, says it won't take for iPhone developers to "translate up" their applications into tablet form. As this happens, the media industry as we know it will be forever changed. "It'll still be a while before this kind of digital publishing is as profitable as traditional publishing was," he said. "But now, there's a clear path, as opposed to uncertainty."