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World?s largest publishers betting on paid mobile content: ad:tech

NEW YORK ? During a session at ad:tech, industry executives discussed traditional media companies? plan for getting consumers to pay for digital content and expressed high hopes for tablets.

Next Issue Media is a digital publishing consortium of Condé Nast, Hearst Corp., Meredith, News Corp. and Time Inc. These traditional media giants have banded together to come up with business models for publishers to monetize digital content across PCs, tablets and smartphones.

?Next Issue Media is a merger of technology and content partners founded by publishers, for publishers, with advertising in mind,? said Morgan Guenther, president/CEO of Nest Issue Media, New York, who was also a cofounder of TiVo. ?We will deliver curated digital content, high-quality editorial content that delights the consumer and supports advertising across high-resolution touchscreen mobile devices

?The goal of the consortium is to find standards, tools, business models and the rules of engagement for this complicated ecosystem,? he said. ?Mobility is a huge benefit?having content on phones and tablets is a significant plus.

?People like to read or watch video while they commute or while waiting in line for coffee.?

The five companies that are collaborating on Next Issue Media have titles such as Better Homes and  Gardens, People, More, Wired, Vogue, Cosmopolitan, Good Housekeeping, Sports Illustrated, Vanity Fair, Time and Esquire.

The media companies are bringing 130 million subscribers and 300 million readers to the table, so Next Issue Media has a built-in base of consumers.

Mobile content: paid or free?
Mr. Guenther said that he believes consumers are receptive to digital advertising, as well as a variety of other business models that include pay-per-download, subscription, micropayments and hybrid models.

Next Issue Media is pursuing a publisher-centric business model that leverages the direct relationships that media companies have with consumers.

While the iPad has had a significant impact on the company?s strategy, Mr. Guenther said that he is especially excited about the prospects for tablets to reach the masses.

Apple alone is projected to sell 40 million tablets next year, and there are between 30 and 35 Android and Windows tablets in the queue.

Lower-priced, high-resolution devices will drive adoption of tablets in the mass market.

Next Issue Media projects subscription revenues of $3 billion next year, with $1.3 billion of that total being incremental revenue.

In addition, revenues from single-copy sales, international sales, flex pricing and advertising could add billions more in profits, per Mr. Guenther.

?Touchscreen media is perfect for rich interactive advertising products that drive incremental revenue growth across print and digital platforms, plus rich data analytics and reporting,? Mr. Guenther said.

Next Issue Media is planning a launch next year in three phases. The first phase is rolling out a multi-titled digital storefront in 2011, with a focus on tablets.

For Phase II, the company will add support for smartphones, netbooks and other high-resolution touchscreen devices.

During Phase III, Next Issue Media will add other publishers and titles. It will also focus on international distribution.

The goal is to enable multidevice, multiplatform capabilities, with Apple, Google?s Android and Microsoft?s Windows the primary focus.

The plan is to enable single authentication, so consumers can access the content they pay for on any device they own.

The company is based around creating a business model that can support industry requirements, and that will include a heavy emphasis on paid content.

Next Issue Media will be able to offer advertisers owned or shared access to the customer data that is required to deliver the highest quality and most relevant products and services to consumers.

The company hopes its advertising delivery and measurement capabilities will mesh with publisher ad sales groups and relationships. It plans to offer advertising network opportunities across long-tail publications.

Thousands of magazines and newspapers will offer interactive titles optimized for touchscreen mobile devices, not replicas of the print editions.

Next Issue Media plans to support multiple pricing options, including credit card payments and print/digital bundles.

The five participating media companies will not be precluding from doing their own thing.

?All of the publishers have pursued their own initiatives in mobile and digital content distribution,? Mr. Guenther said.

?A big bet has been made in the native apps area, but with HTML5 and more sophisticated browsers, the Web will offer increased opportunities going forward,? he said.

The other speakers who presented were Jim Spanfeller, president/CEO of the Spanfeller Media Group, New York, Marci McCue, vice president of marketing at Flipboard, Palo Alto, CA, and David Restrepo, general manager of The Content Project, New York.

Final Take