This was written for my new website at WriteThru.
While the easy-to-read flat screens now being sold by Amazon are definitely a step in the right direction, technology can only save an industry if the revenue model makes sense.
Consider these drawbacks:
- Consumers either have to pony up $489 to buy one of the devices OR sign up for a lengthy subscription to get a discounted device, reports the Los Angeles Times.
- Amazon wants 70 percent of the subscription revenue from newspaper sales, reports Endgadget. Worse: Amazon also gets permission to republish content on other devices, such as the iphone.
- If consumers must buy multiple subscriptions – ranging from $5.99 to $13.99 a month – to get news from EACH source, which content companies will be left out in the cold? Perhaps local news providers?
- Do the math: News producers will get only $1.7 to $4.197 a month if they’re getting only 30 percent of the revenue.
As any Apple follower will tell you, the way to make money off new content-delivery devices is to own the hardware and control the content. It sounds to me that Amazon is following this model, while leaving news producers out in the cold.
So I nervously laugh when I read that New York Times Publisher Arthur Sulzberger Jr.’s shouted “Wonderful!” at the unveiling of the large-screen Kindle DX. As much as I believe that simple readers are the wave of the future, the product might do as much damager to newspaper companies as did Google News and Craigslist.