Apple’s ‘News’ App Is Latest Sign of Distribution Shift for Publishers

Apple Inc. on Monday announced a new app for reading news which will combine articles from more than 50 publications into one customizable stream, furthering a shift in how publishers distribute their content on digital platforms.
The Apple News app, which is expected to launch in the fall, will come preloaded on the company’s new operating system iOS 9, meaning it could potentially give publishers access to hundreds of millions of readers around the world.

“We see great potential in this partnership to reach very, very large audience groups,” said Mark Thompson, president of the New York Times Co., which is one of nearly 20 publishers to sign on with Apple for the launch of the app. “We believe this is a great way to get people who are less engaged with our brand to become more so.”
Beyond the New York Times, the first group of partners includes The Economist, the Daily Mail, BuzzFeed, ESPN and several titles from Vox Media, Conde Nast, Hearst and Time Inc. Rather than sifting through the apps of these individual publishers, a user of the Apple News app will see a blend of their content.

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The Apple initiative comes on the heels of Facebook’s launch last month of a news partnership called Instant Articles in which publishers ranging from NBC News to National Geographic post their stories directly onto Facebook’s newsfeed, rather than linking readers back to their own sites. Earlier this year, the messaging app Snapchat launched Snapchat Discover, which allows publishers to create special content designed to appeal to the platform’s mostly younger users.
Such efforts have sparked debate in the media world about whether the power of individual publisher-branded websites and apps is beginning to fade as digital outlets become stronger avenues to distribute content, especially to young Web users that do their reading on smartphones. In partnering with outside parties, publishers tap into huge audiences, but also inherently relinquish some control.
The Apple app is similar to one offered by Flipboard, which lets readers create their own customized news feeds, choosing among a variety of publications and broad news categories.
Apple said the arrangement will allow publishers to keep 100% of the revenue from ads they sell themselves and 70% of ad revenue generated by Apple’s iAd platform. Those terms are similar to the deals Facebook is offering.

Publishers said they hoped the app would give them greater access to the young readers advertisers covet.
“It’s going to give us an opportunity to reach people with our content, including younger readers,” said Scott McAllister, Time Inc.’s senior vice president of digital marketing and revenue. “Maybe some will fall in love with People magazine, and create a relationship with People.com or the People app. That we can sell advertising around the content, and also have the ability to reach such a large audience, is equally exciting.”
Mr. McAllister said the fact that the app is being built by Apple engineers will likely make it a solid experience for users. “We’ve seen some examples of what it will look like, and it’s truly beautiful,” he said.
Apple, however, is months away from having a final product, which means the consumer experience is still being developed, he said.
Online publishers see just as much benefit from partnering with Apple as traditional publications. John Kosner, the executive vice president of  ESPN Digital, said the combination of Apple’s reach and reputation for technical prowess in making high-quality products provides publishers with a “tremendous opportunity.”