NYT’s 10K subscribers on Kindle: The start of something bigger?
One other important note from that internal New York Times memo my colleague Zach got a hold of: The company reports it has “more than 10,000 paid subscribers” to an electronic edition of the newspaper on Amazon’s Kindle ebook reader. To my knowledge (please correct me if I’m wrong), that’s the first time a major newspaper has released numbers on how it’s doing on Kindle — a platform lots of newspaper execs are eager to see turn into a saving grace for their industry.
Given that the electronic Times costs $13.99 a month, that would mean the NYT Kindle edition is generating in the neighborhood of $1.68 million a year. How much of that goes to NYT Co. and how much stays with Amazon is unclear.
Amazon has been tightlipped about how many of the devices it has sold, which has led some (including me) to think it might be a smaller success than some had hoped. (TechCrunch claimed in August it knew the number: 240,000.) If we do some highly crude back-of-the-envelope calculation, that would mean The New York Times has a penetration rate on the Kindle of around four percent.
Not bad, considering the Kindle is the first incarnation of that dreamy aspirational future of newspapers: no physical distribution costs, plus a steady revenue stream that comes from news consumers, not advertisers.
This also provides some guidance in how other newspapers might be doing on the Kindle. Amazon publishes rankings of its newspapers’ sales: The NYT comes in second behind The Wall Street Journal, but ahead of the papers you might imagine (The Washington Post, Financial Times, Chicago Tribune, Los Angeles Times, International Herald Tribune). Amazon’s sales-ranking systems are famously inscrutable — just ask any author who tries to track how his book fares hour to hour — but I’d guess the Journal is generating Kindle revenue numbers similar to the Times’, since they sell their edition for only $9.99 but have more subscribers. My suspicion is that there’s a pretty steep dropoff in Kindle sales numbers after the NYT, then a much steeper one after the FT — I’d be curious to see numbers from a major metro like The Boston Globe or The Denver Post. The early-adopter crowd that is currently buying Kindles is, I suspect, more interested in a national news product than their local daily.
I’ve been at a number of conferences recently where newspaper people point to the Kindle (or at least Kindle-like devices) as a major source of industry salvation — arguing that the Kindle will have an adoption slope similar to the iPod’s, and that they’ll soon be seen in every park and subway around America. And since Kindle users pay money for content, there may be a business model for newspapers after all.
I’m not yet sold on that vision. I think for the Kindle to reach mainstream success, it’ll have to shift its focus from being an ebook reader with a junky mobile web browser to being a great mobile web browser with an ebook reader attached. It’ll have to become something more like the iPhone with a bigger screen and better battery life. (There are signs the iPhone might already have the ebook-reader lead over the Kindle, although without the business model attached.)
And when that shift happens, it’ll become trivially easy to read newspapers’ (free) web sites on the device — which I suspect will undercut Kindle newspaper subscriptions just as it undercuts print newspaper subscriptions. But the NYT’s numbers are among the first public signs that people — at least some people — are willing to pay to get news in the electronic format of their choice, even when they can get it on the web or their phone for free.
Perhaps the rankings change on an intraday basis, but when I looked at the Amazon rankings just now, the Times was first, not second (at #28 versus all Kindle sales including books and magazines, and the WSJ is #36. The Washington Post is a rather distant third at 158. Click through to the individual newspaper pages and scroll down for Amazon Kindle sales rank.)
I agree that the Kindle might not be the right device, although the Kindle 2 looks like an improvement. Certainly the “iPod for news” is a gizmo the industry and the public should expect. There might be a number of different ones ranging from the iPhone format to the full-page e-reader. Somewhere along the adoption curve, these devices will encourage newspapers to shed their print editions and go all-digital. I would expect they will continue to be free on web sites, while selling as a subscription an edition specifically designed and formatted for e-readers.
Thanks for the comment, Martin. The rankings do flip around regularly, it seems — part of that inscrutability. And those numbers contribute to my worries about the Post as a nationally focused paper when there may not be room for one beyond the NYT and WSJ.
To go deeper down the list, here are the American papers on the list and how they rank at the moment:
New York Times, ranked #27
Wall Street Journal, 37
Washington Post, 159
LA Times, 216
Chicago Tribune, 291
Investor’s Business Daily, 502
San Francisco Chronicle, 792
Seattle Times, 850
Atlanta Journal-Constitution, 930
San Jose Mercury News, 976
Boston Globe, 1024
Arizona Republic, 1292
Houston Chronicle, 1301
Orange County Register, 1319
Baltimore Sun, 1448
Philadelphia Inquirer, 2235
Denver Post, 2447
Austin American Statesman, 2706
Orlando Sentinel, 3948
So a pretty big dropoff after NYT/WSJ, then another big one after WP/LAT/Tribune to the metros.
The beauty of Kindle is that we are finally getting traction on a mobile, updatable device that is a good environment for serious readers and therefore a good environment for newspapers, whose customers have always been serious readers.
The attention-deficit-disorder environment of a Web site (and the iPhone) is not a good environment for serious readers and text-heavy newspaper content. (See Nicholas Carr’s Atlantic magazine cover for July/August.)
That’s the reason, I suspect, people don’t spend as much time on newspaper Web sites as they do with the print product. Heavy reading in that environment is just not as enjoyable as it is in print.
Because of eInk technology, however, the Kindle’s electronic screen can duplicate the experience of reading ink on paper.
Jeff Bezos designed the Kindle to replicate the experience of getting absorbed in a book. The same device, of course, can replicate the experience of getting absorbed in a newspaper.
It’s the eInk, stupid!
As a graphic communications professional, newspaper industry expert, graduate student at NYU, and basic all around 30 year old human being, I do not know ONE SINGLE person who owns a Kindle.
Total Sales as of Today’s date:
240,000 Kindles
1,000,000 Zunes (microsoft’s mp3 player that no one owns)
6,124,000 iPhones
163,000,000 iPods
I agree with Rudolph Bell: It’s the E Ink, stupid. The reason I and (apparently) lots of others are willing to pay for newspaper content on my Kindle but not on the web is that reading on the Kindle is easier on the eyes and mind. Another intangible advantage for the Kindle is that Amazon has brilliantly positioned it as a READING device, not a computer. Because of that, when I load content to the Kindle, I feel as if it’s “mine,” whether I found it for free on a site like FeedBooks, or I paid for it at the Amazon store. Because of this sense of ownership, I am much more likely to pay for a newspaper subscription on my Kindle, and that’s why it may offer newspapers and magazines a desperately needed new business model. I subscribe to the FT and the Washington Post (thanks to their free offer at the election; I got hooked on their home-town advantage in D.C. political coverage.)
The key to this new golden goose for the NYT and others is NOT to fix the browser and make the Kindle more like a computer. It’s to make sure Kindle 2 is even MORE like a book, not less.
Kindle 2 should be more like a book, Len? No, it should be better than a book. To get me to give up paper, an e-reader has to be better. If the Kindle could combine e-ink and the functionality of Diigo.com — the ability to bookmark text on the Web OR in an e-book or e-newspaper, annotate it and share it with colleagues — that would be the perfect combination of device and service.
Jack, point taken. When I say Kindle 2 should be more like a book, I have in mind a sort of magical book – a book that does everything the old books did, just better. So yes, annotations and bookmarks and lookup are key. What I don’t think will help is to add features just because they’re possible, even if they do not do “bookish” things. That’s why I’m glad Bezos says there will be no video on the Kindle. It should remain about reading, only more so.
When the PDF versions were big a few years ago (publishers were DYING for them) I did a study.
I called many, many newspapers while I was at the Miami Herald as we (unfortunately) scrambled to launch a pdf version at the SCREAMING of Alberto Ibarguen.
I determined that we would be lucky or “on the mark” if we got 1 percent of 1 percent of our PRINT readership to adopt the pdf version.
A year later. Exactly correct numbers.
Fast forward from 2004 to 2008 in Charleston, S.C. and the Post and Courier.
I was VP for Content for the digital division that owns that paper, several other papers and about 9 TV stations.
I asked the head of Charleston.net what the subs were for the pdf version of Post and Courier…
want to guess what it worked out to?
1 percent of 1 percent of the overall PRINT subs.
Amazing.
I bet Kindle ends up less than that.
10,000 SOUNDS like a lot, but do some math and it’s nothing compared to the PRINT subs…
Think PEOPLE.
Oh, and the project at the Miami Herald that Alberto ORDERED cost $70,000 to implement. I later determined we could have FedEx’d each pdf subscriber a copy of the print newspaper OVERNIGHT for an entire year for less than developing the stupid pdf version.
Good job Alberto! Look at where the Herald (and Knight Ridder) are now!!!
Love the Kindle, but let’s not get too excited about eInk – it is very limited. Can’t do color, can’t do video – never will be able to do so.
Just got the Kindle 2.0. It is optimized for reading. In fact highlighting, saving to clippings is very easy. I haven’t figured out the way to get the clips onto the computer but I’m pretty sure there is a way.
My take is that it is an awesome reading appliance. The problem for a newspaper is that readers are a niche market. A nicely growing niche. But not the mass market that Paper has.
As Bezos has described in interviews the Kindle is for reading long form stories – essays to books.
I think we should all keep an eye on the epaper device that Hearst will be introducing later this year. From early descriptions it should be much more newspaper business friendly.