Why is What Hi Fi digital edition so expensive?

[altruistic.lemon]

I can buy an annual subscription for probably the most respected HiFi magazine on line for $12.79. Why does What Hi Fi cost more than double - surely the digital edition must cost way less than the paper one?

 

[Big Aura]

magazines are zero-rated for VAT in the UK, this doesn't apply to digital editions. Where are you buying 12 issues for $1.07/69p each?! (assuming you're calling WHFS&V the most respected hifi mag!)

 

[altruistic.lemon]

American, I'm afraid. May not be as well known here as it is in oz.

 

[Andrew Everard]

I can buy an annual subscription for probably the most respected HiFi magazine on line for $12.79.

Stereophile's about that kind of money, too...

Why does What Hi Fi cost more than double - surely the digital edition must cost way less than the paper one?

US magazines traditionally have bargain-basement subscription rates, both online and in print, some would say so that the cost of subscription is so low that people don't even think about it when it comes to renewal time. It's all used to boost circulation and readership figures in order to keep advertising rates high. Very high.

The UK model is much more based around the newsstand price, with subscribers very much in the minority.

And in fact the digital edition costs us at least as much, if not more: in fact, the hefty cut taken by the companies distributing these digital editions means we actually make less on a digital sale than we do on one sold in physical form.

 

[tino]

The digital edition of said US magazine is only $9.75 for 12 issues (International print edition is about 4 times more expensive). Have been reading their CES 2012 report online ... looks quite comprehensive. Good music reviews and coverage of the some of the more esoteric hifi marques.

 

[Andrew Everard]

Exactly the point I was making about the US subcriptions model: the US price for the print edition of that magazine is $12.97 for a year, meaning around $1.08 an issue, which here would hardly cover the postage. That's against a cover price of $8.99 per issue, and represents an 88% discount.

The digital issue, at $9.75 a year, is just over 81c per issue, or a 91% discount.

That means the digital edition is only a bit less than the the print issue subscription price, which is exactly how our digital edition works. Mind you, the digital edition of WHFSV is substantially less – and much faster – than international subscriptions for the print magazine.

 

[BenLaw]

I take it it would be prohibitively expensive for WHF to distribute the digital edition itself rather than through a third party?

 

[Andrew Everard]

I take it it would be prohibitively expensive for WHF to distribute the digital edition itself rather than through a third party?

It's something we did explore at one point with one of our suppliers, but yes it was.

 

[BenLaw]

Shame, cos zinio seem to be taking a sizeable cut with mixed levels of performance. I guess when there is greater competition in this area prices will fall and performance will improve.

 

[6th.replicant]

...The hefty cut taken by the companies distributing these digital editions means we actually make less on a digital sale than we do on one sold in physical form.

Out of interest, why isn't the digital edition distributed from in-house?

 

[Andrew Everard]

Shame, cos zinio seem to be taking a sizeable cut with mixed levels of performance. I guess when there is greater competition in this area prices will fall and performance will improve.

We hope so: current digital magazine distribution channels are pricey, and Zinio is by no means the most expensive.

In a model such as the US one, where giveaway subscription prices are the norm in the pursuit of the numbers game, that's not so much of a problem: after all if you are selling an $8.99 magazine for 81c, it probably doesn't matter to you that you're in fact only seeing 56c, or maybe as little as 49c, of that.

But on a magazine selling for £3.50-something as a digital edition, losing a sixth of that as VAT (no VAT on print magazines), plus a further 30-40% to the digital company, is something of a pain, to say the least.

You pay £3.50-something for the digital magazine, we only see about 35% of the actual cover price of the magazine print edition. Not good.

 

[Andrew Everard]

Out of interest, why isn't the digital edition distributed from in-house?

A question I answered above: in common with most magazine houses, we're just not set up at the moment to administer payments, control distribution by digital systems and so on. That's not to say it won't happen, and as a company we are constantly monitoring the uptake of digital subscriptions across our portfolio of titles, and exploring different distribution routes.

 

[BenLaw]

Shame, cos zinio seem to be taking a sizeable cut with mixed levels of performance. I guess when there is greater competition in this area prices will fall and performance will improve.

We hope so: current digital magazine distribution channels are pricey, and Zinio is by no means the most expensive.

In a model such as the US one, where giveaway subscription prices are the norm in the pursuit of the numbers game, that's not so much of a problem: after all if you are selling an $8.99 magazine for 81c, it probably doesn't matter to you that you're in fact only seeing 56c, or maybe as little as 49c, of that.

But on a magazine selling for £3.50-something as a digital edition, losing a sixth of that as VAT (no VAT on print magazines), plus a further 30-40% to the digital company, is something of a pain, to say the least.

You pay £3.50-something for the digital magazine, we only see about 35% of the actual cover price of the magazine print edition. Not good.

This must give you rather split motivations as to progressing the digital distribution. Frustrating.

 

[Big Aura]

very interesting stuff, Andrew.

I suspect it won't be long before Haymarket has it's own digital distribution arm....

Do you offer cut-price subscriptions on the digital issue, or do the finely-balanced economics make that impossible?

 

[Andrew Everard]

This must give you rather split motivations as to progressing the digital distribution. Frustrating.

At the moment, the digital edition is more about providing a service – a magazine viewable on various electronic devices, plus faster and less expensive access to the magazine for overseas readers – than making oodles and boodles more money.

Do you offer cut-price subscriptions on the digital issue, or do the finely-balanced economics make that impossible?

Yes: via Zinio the magazine for UK readers is £3.59 (£2.99 + VAT @ 20%) per issue, or £35.16 (£29.30 + VAT) for a year, which is 13 issues. So the subscription saves you an additional 25%.

Or if you want to go through Exact Editions, it's £37.99 for a year, or £9.50 for three months, with new subscribers getting access to issues back to October 2011, which is when EE started offering the magazine.

 

[Andy Clough]

To add to what Andrew has already said, we're also looking at Newsstand on iTunes, but Apple takes an even bigger slice of our revenue. Neither option is ideal, but we want readers to be able to access the digital edition as quickly and easily as possible. Using an existing electronic distribution network will meet that goal more quickly than setting one up ourselves.

 

[chris hollands]

Would you say that most people with a digital copy also buy a hard copy as well ??

 

[Andrew Everard]

Would you say that most people with a digital copy also buy a hard copy as well ??

Since the print subs are handled by The Magazine Shop, and the digital ones by Zinio and Exact Editions, it's hard to correlate the two. We are still looking into the possibility of offering a 'hybrid' subscription package, offering both print and digital copies, but no news on that one just yet...

 

[Anonymous]

I'd love to see a Apple Newsstand edition of What Hi-Fi. As a international subscriber, the Zinio digital copy is the way to go for me. But a simple pdf copy of the printed magazine leaves so much more to desire. Take a look at Evo Magazine and Newsweek, that's two excellent examples of how a publisher should use the iPad as a medium.

I'd be willing to pay a bit more for a Newsstand subscription over a Zinio, if the Newsstand version gives me a unique experince through the use of multimedia content. I understand that a Newsstand edition is only for the Apple crowd, but if you look at the tablet market you soon realise that most users own a iPad.

I firmly believe that tablet publishing is the future for the magazine business. Fingers crossed for a new What Hi-Fi...