Ipad Pitfalls?

The iPad dreams of magazine publishers could be the latest death by irrational exuberance.

Despite the optimism that greeted the new device, there is a danger that publishers are squandering an opportunity with clunky apps, bad pricing strategies and unsustainable ad tactics.

The iPad itself is on its way to being a hit, although not as quickly as many predicted. Apple disappointed analysts who anticipated it would sell 4.7 million in the fourth quarter by offloading only 4.2 million. All told, 7.5 million units have been sold since April. Clearly, tablets are set to take a chunk of the netbook and desktop computer market. But for now, the market is tiny: about 4 percent of households own a tablet, according to Nielsen—hardly a mass market.

According to a survey of 5,000 tablet users released last week by Nielsen, 91 percent of iPad owners have downloaded an app—and over half have paid for content. Among the top paid apps, however, magazines fall in eighth place. Their individual download title numbers are puny.  

Wired crowed about its 100,000 downloads for its first app issue in June; that number has dwindled subsequently to 32,000 in September. Part of the problem stems from the hefty prices charged for publisher iPad apps. An issue of The New Yorker, for instance, runs $4.99. What’s more, there’s no way yet to get annual subscriptions. 

“In the grand scheme of things, there’s a chunk of eyeballs, but if you’re looking for mass awareness, the iPad isn’t the vehicle yet,” said Rich Ting, ecd of the mobile and emerging platforms group at R/GA.

The apps themselves are also missing the mark.