TABLET TALK: Publishers have spent the last two weeks declaring that they just love their tablet businesses, and Hearst Magazines president David Carey did it again on Wednesday morning, telling an audience at the Paley Center, “That business is flying.” Why are they so optimistic? The Kindle Fire has a lot to do with it.
“We are as excited as we can be for the Kindle Fire,” said Carey, a little hoarse-voiced as he fought through a cold. “There’s going to be this fantastic trade war between Barnes & Noble and Amazon and Apple that’s going to be an enormous benefit for the magazine industry. These are people bringing out better devices that are used to consume our content at lower prices.”
Last week, Carey made a bit of a stir among his competitors when he declared at The American Magazine Conference the importance of portability with tablets. He elaborated on that on Wednesday.
“When the iPad came out, we thought, ‘This was the ultimate device,’” he said. “All of our content had to go through the iPad. The screen is so good, the ads look so good, it’s a little computer that can do everything. And then when the Nook Color arrived it didn’t have as many functions and we started producing replica products — we were the first of the big companies to go in with all of our portfolio — and, boy, what an incredible surprise. It taught us that there are two kinds of consumers of tablet media: Those who want their video of Oprah and want every page to be interactive. But the replica market is potentially far bigger where portability of content is the key benefit and not the enhanced features. The economics for us out of that part of the business is far better.”
Carey told WWD last week that Hearst will bring in at least $10 million in e-subscriptions by next summer. Condé Nast president Bob Sauerberg said the company would bring in $15 million through tablet subscriptions and advertising by the end of this year. It’s revenue that once didn’t exist, but Carey did acknowledge ultimately that it is still pretty small stuff.
“Thus far, the digital or the tablet content feels like it’s mostly additive,” he said. “There will be a time perhaps that will not be so. Right now, we have 25 million print subscriptions in our company. And that complexion could change. Maybe one day it will be 22 million in print and 6 or 7 million tablet. We have growth, but I think the mix will start to shift but over a long period of time.”
And, by the way, what does it look like to be an editor in chief at Hearst these days? Well, editorial sentimentalists, be warned: You’re not spending your day with writers and editors developing features and cover stories. Instead, it’s time for diet books, TV shows and slide shows. To which Carey, the businessman, says, “Thank goodness.”
“We had a big business review yesterday with one of our key businesses, Good Housekeeping,” said Carey. “And the editor in chief [Rosemary Ellis] began by giving an overview of the activities she’s personally involved in: the magazine; the Web site; the tablet editions; a set e-books that we’re carving out of the archives; a physical book born out of a section of the magazine called Drop Five Pounds, and she just came back from producing a television show around this as well. I think I ran out of fingers by time she was done talking about what she was involved in. I said: Thank goodness that the job of being an editor in chief today is so dramatically different than what it was just a few years ago.”