Specifically, Amazon just announced a new program that would allow newspaper and magazine publishers to receive a 70% royalty split from Amazon, which has become the sort-of industry standard revenue share for content, led by Apple’s iPhone App Store in 2008. Previously, Amazon captured a higher percentage of revenue.
This seems like a change that the publishing industry forced upon Amazon, so that publishers could work on the same pricing levels with other content stores, such as Apple’s iTunes.
Earlier this year, Gawker’s Ryan Tate reported that one of the reasons the New York Times’ iPad app was so limited in content selection is that the company’s “existing agreement for the Amazon Kindle … apparently precludes the paper from releasing a cheaper, comparable e-edition on a competing tablet.”
We don’t know for sure, but it sounds like this change could iron out some of those issues, allowing the NYT and other publishers to charge the same amount on the Kindle and iTunes platforms, while receiving the same revenue split.
According to Amazon, here’s why it changed its revenue sharing terms: “Building on the recent introduction of Wi-Fi-enabled Kindles and the upcoming availability of newspapers and magazines on Kindle Apps, we’re pleased to add an increased revenue share and a great new tool for making Kindle better and easier than ever for publishers.”
Amazon will require publishers to satisfy “several customer experience requirements” to get the new revenue sharing terms, including that the newspaper or magazine content must be available on all Amazon Kindle devices and Kindle apps for other platforms.
This is one of many problems that publishers have had with Apple’s iTunes store, including issues merging Apple’s iTunes payment system with their existing subscription databases, accessing customer information, etc.
So, when might Apple launch an iTunes newspaper store? It’s getting late to offer one this Christmas, unless it’s a surprise feature in iOS 4.2, which is due out this month. So the next logical time might be early- to mid-2011, whenever it announces a new iPad and/or iOS 5.
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