This is a guest post by the FT’s media editor, Andrew Edgecliffe-Johnson
Fleet Street has hyped the iPad’s international launch as loudly as any smitten blogger, but if Britain’s newspaper owners believe that Apple’s tablet promises them salvation they were not rushing to demonstrate it on Friday.
The Guardian already had a photojournalism application ready before the international launch, but the only UK paper to unveil a new iPad app was The Times, which only days ago unveiled a new website.
News Corp’s UK title seems to have taken a leaf out of its US sister paper, the Wall Street Journal, by charging an ambitious £9.99 a month, close to the $17.29 monthly price the Journal has set for its app. That is on top of whatever readers are paying for the print newspaper or the website (the new Times site charges £1 a day or £2 a week to non-print subscribers).
The more interesting iPad action was in the book business. In the US, five of the six big publishing houses – market leader Random House being the notable exception – signed up to the “agency” model (whereby the publisher sets the retail price, rather than allowing the retailer to discount from a wholesale price as was happening with the Kindle’s $9.99 best-sellers) Apple offered to distinguish its iBookstore from Amazon’s Kindle pricing.
In the UK, just four showed up, with Simon & Schuster joining Random House on the sidelines. According to The Bookseller, the four represent just 36 per cent of the UK market, underscoring the worries about commercial terms and possible legal hitches the FT highlighted this morning.
Overlooked in the UK was the surprise news from Germany that Random House, which seemed most adamantly opposed to the iBookstore’s agency model, has reached agreement with Apple.
The deal will affect only German language books on the iBookstore in Germany, Stuart Applebaum, a Random House spokesman, cautioned when he spoke to the FT. “Each of Random House’s companies worldwide is empowered to negotiate autonomous agreements based on their specific business models and publishing goals with our international retail partners,” he said.
“We are very pleased that Verlagsgruppe Random House’s German-language book content will be directly available from Apple’s iBookstore for Germany, and we hope to eventually be able to reach agreements with Apple to place our content for sale in the iBookstores worldwide,” he added.
So does that mean peace is about to break out between Random House and Apple in the far larger US market? Applebaum would only say that discussions with Apple in the US and other countries were “ongoing” but it seems unlikely: there are few outlets for German language ebooks in Germany, making an iPad deal more attractive for its German group than in the US, where Random House has its choice of other devices and can reach even iPad customers through the Kindle or Kobo apps.
Those publishers who have gone with Apple’s model admit it will entail a short-term hit to profits: in the US, the pain for Random House would be bigger then in a market the size of Germany.
Arnaud Nourry, chief executive of Hachette Livre, France’s biggest book group, voiced the contrary view on Friday, saying that the iPad was an opportunity to widen the market and protect book prices.
As Hachette joined French publishing houses such as Albin Michel and Eyrolles on the iBookstore, Mr Nourry told AFP: “The fact that we can set the price of the titles sold on iPad protects us against a devaluing of the book, which would be damaging to the whole book chain and especially to booksellers.”
In other words, analysts trying to calculate the iPad’s prospects in Europe would do well to remember that the continent’s patchwork of publishers and local laws make simple pan-European deals unlikely. Apple’s relatively small European team has been advertising for publisher account managers. On the evidence so far, they will be busy.
