Mobile has undoubtedly shifted the way that publishers view their revenue models, but with drops in advertising revenue and media companies not taking advantage of the channel, can publishers survive in the post-PC world? 

Print publishers have grappled with how to approach mobile, whether it is with subscription models or advertising, for years. But when it comes down to it, do publishers have a chance in the mobile space or should they just cut their losses? 

?Mobile is a tiny market, however it is growing quickly,? said Agata Kaczanowska, lead industry analyst and media specialist at IBISWorld, Santa Monica, CA.

?Something that has been emphasized this year for publishers is mobile because as smartphone proliferation grows in popularity, advertisers are shifting towards mobile to garner revenue,? she said.

Mobile profits
Ms. Kaczanowska used data from journalism.org to compile a few statistics that illustrate how mobile is making up advertising revenue for newspaper publishers.

In 2011, 0.9 percent of digital ad revenue was generated from mobile, showing how newspapers are primarily relying on the Web as a source of digital ad revenue.

Mobile ads made up 0.1 percent of total ad revenue in 2011, which although small, represents nearly a 2000 percent year-to-year increase.

Additionally, when it comes to overall ad revenue, publishers are still primarily focused on print with 86.4 percent of revenue coming from the channel, per Ms. Kaczanowska.

With the increase in digital content, many publishers including The New York Times, Wall Street Journal and The Financial Times have banked on bundling digital content with print subscriptions as a way to feed news-hungry consumers.

However, overall ad revenue ? including print and digital ? slipped in 2011, showing that publishers still are not getting it right. In 2011, ad revenue for newspapers fell by 7.3 percent to generate $23.9 billion, according to a report from the Newspaper Association of America.

Recently, the New York Times reported that for the first quarter of 2012, digital advertising revenue fell 10.3 percent year-over-year. Print advertising revenue fell 7.2 percent for the publisher this quarter.

?Most publishers are still experimenting with their subscription models and figuring out what works for them,? Ms. Kaczanowska said.

Print obstacles
Although many publishers are focusing on their digital strategy, there is still an overwhelming need from consumers to read editorial content in print, making it a challenge for publishers to know where to place their bets.

?The challenge for publishers is that the print channel is not obsolete because some people still want to have a print product, but you also have an emerging group of people consuming in a multichannel way or reading exclusively on their devices,? said Noah Elkin, principal analyst at eMarketer, New York.

?Mobile is a loss leader for most publishers, but over time as more and more people adopt these devices as their primary platform for getting information, the balance may shift where print becomes the loss leader and the balance of revenue switches to digital and mobile,? he said.

User habits for reading a print newspaper versus a magazine are also a crucial part of understanding how publishers are approaching mobile. Given the text-heavy emphasis in newspapers, content is more conducive to reading on a laptop or a print product. On the other hand, magazines are more image and multimedia-driven, making them a fit for tablets with larger screens and higher image qualities.

However, the tablet versions that magazine publishers are pushing do not always take advantage of rich features that add something extra to the reading experience. 

Often magazine applications are a static replication of the magazine with ads and content that do not let consumers interact with the magazine on a different level.

Instead, magazine publishers should be looking to the tablet to give users content that they cannot get elsewhere.

For example, publishers can include mobile-exclusive videos or behind-the-scenes content to give readers an incentive to use their devices.

?Although tablets are not the savior that they were thought to be, at least it gives publishers a fresh start to how they display their content,? Mr. Elkin said.

Lost money?
One of the challenges that many publishers are facing is finding a way to separate mobile as a concrete revenue stream compared to digital.

?We typically see mobile revenue being carried as a separate line item as publishers share this information to the marketplace,? said Richard Giannicchi, executive vice president and global media lead at Publicis Modem, New York.

?We believe that as devices continue to evolve, the line between digital and mobile will continue to be blurred, and these dollars will most likely be rolled up into a single bucket,? he said.

Although digital has long been believed to be a killer to publishers, if done correctly it could help publishers boost revenue with cheaper costs to make and distribute content, per the executive.

Few publishers have a set-in-stone digital strategy and many are using bundled subscriptions that include mobile, Web and print to see which platforms consumers respond the most to. Even though it might not be the most sustainable model, bundled subscriptions give publishers a way to test digital initiatives with their print product to fall back on.

?For the short term, the bundled subscription model should help to retain paid readership of their print titles, but the success of the brands long-term will be heavily dependent upon the success of translating print content into digital and mobile platforms,? Mr. Giannicchi said.

Content is king
According to some mobile experts, publishers still have not nailed down a strong content strategy, and until they do the money will not follow.

?In the publishing world, high CPMs are critical, and downloading apps expands the subscriber rate and therefore drives higher ad revenue,? said PJ Gurumohan, cofounder/CEO of GENWI, Los Altos, CA.

?Having said that, publishers need to think about cultivating engagement before they can monetize an app,? he said.

?Publishers are beginning to understand that creating engaging experiences on tablets represents one of the biggest opportunities that they have had since the invention of the printing press with the opportunity to reach their readership and cultivate new and engaging experiences.?

The opportunity for engagement lies in the tablet for mobile ad revenue.

For example, recent research from GfK MRI iPanel found that 70 percent of tablet readers wish that their digital editions included personalized advertising (see story).

However, many publishers are not looking for ways to include personalized content such as location and browsing history into their digital publications. By using these kinds of features, readers would have an incentive for using a mobile product, which benefits both publishers and advertisers.

Multiplatform readers
With consumers digesting news on multiple screens, it is imperative that publishers recognize that content is more than just a one-platform experience.

?At the end of the day, a consumer does not care what platform they are reading on ? they just want the content,? said Carl Howe, vice president of consumer research at Yankee Group, Boston.

?Having a bundle where they can choose the platform to read on is the right approach until something becomes dominant,? he said.

Therefore, publishers need to think about content that will work on multiple screens that users can access whenever they want.

In order to be successful, publishers could look at how both the cable industry and book publishers have approached mobile to get a better grasp on monetizing, per Mr. Howe.

With cable packages, consumers only have a few options on which channels they get. Often times, the cable companies package a free mobile app with cable plans that let users access the same content via their mobile device as long as they at home where the signal comes in.

Book publishers have taken a different approach to mobile with developing ebook and mobile versions of books. Consumers are often encouraged to buy both a hardcover and a digital version and when sold together, the transaction comes through as two separate sales that help book publishers understand how much digital is playing a role overall.

Amazon is aggressively going after digital publishing with its Kindle Fire device that is aimed at being a hybrid between a tablet and ereader. Additionally, users can buy books from Amazon?s store and transfer them to multiple devices, including Barnes & Noble?s Nook and iOS devices. For publishers, Amazon?s deal means that having publications on multiple devices works to a company?s advantage and can help increase sales.

The Department of Justice is also reportedly suing Apple for working with book publishers to raise ebook prices. If the suit plays out, Amazon could be positioned as the prime player in the ebook space (see story). 

?At the moment, most of the revenue is still coming from the dead trees,? Mr. Howe said.

?Even though revenue is coming from print, it is a shrinking industry and digital gives publishers breathing room,? he said.

Final Take
Lauren Johnson is editorial assistant on Mobile Marketer, New York