Although Amazon recently improved the terms it offers publishers who distribute books on the Kindle, it continues to offer magazine content providers a 30% revenue share.
Given that the device is monochromatic, prices are determined by Amazon and publishers don’t get to establish a relationship with their readers, Ad Age asked, “Why would any magazine or newspaper publisher strike a deal with Amazon?” Their reporting turned up five answers:
- The Kindle footprint is still relatively small, lowering the risk of subscriber cannibalization
- A 30% revenue share without physical cost can improve circulation profitability
- Publications in the Kindle store are seen and bought by the consumers interested in a digital option
- It’s a toe in the water, even if it’s not the solution publishers want
- Contracts are short enough to support a migration, if needed
The article’s headline aptly proclaims, “Pubs flirt with Kindle but don’t carry a torch.” I have to agree.