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Updated: After speaking with additional sources, it looks like Hearst may have not gotten any special treatment on revenues and the sharing of consumer data with regard to Hearst Magazines’ app subscriptions. Neither Apple (NSDQ: AAPL) or Hearst would comment about the revenue split. The App Store terms require publishers of magazines or games to fork over a 30 percent cut of subscriptions sold back to Apple; publishers keep the remaining 70 percent.
Two sources also disputed Hearst’s statement that the Apple subscription agreement is substantively different from any other plan. The Hearst subscriptions allow consumers to opt-in and share their zip code and e-mail, something available to all publishers who accept Apple’s terms.
Original post: Hearst Magazines is the latest publisher to start selling magazine app subscriptions in Apple’s App Store starting with the July issues of three of its popular titles, the WSJ reports. But sources tell paidContent that unlike other publishers, this deal is separate from the usual terms Apple stipulates, which generally include taking a 30 percent cut of subscription revenues and keeping data about the purchasers to itself.
A Hearst rep wouldn’t comment on the revenue split, but did say that “Our deal is fundamentally different from any other deal Apple has done with a publisher; we came to fair and equitable agreement that allows both parties to own customers together.”
Although major publishers had initially expressed extreme frostiness when Apple unveiled its App Store subscriptions policy back in February, but as e-editions circulation grows, magazine companies are finding the allure of locking in readers for an extended period too hard to resist.
A few days ago, Time Inc. (NYSE: TWX), which already had a subscription deal in place for its People magazine’s iPad app, has now extended that to its publications.
The Hearst deal covers corresponding apps for Esquire, Popular Mechanics and O, The Oprah Magazine. Subscriptions to all three publications will be sold for $1.99 a month or $19.99 a year.
Under Apple’s terms, the publishers get a 70 percent share of the subscription revenues sold in the App Store. Publishers were previously galled by the revenue split Apple proposed, but in the end, they decided they wouldn’t be able to win on that front.
However, a Hearst rep told paidContent that the publisher did score a victory on an even more crucial point: subscriber data. “Our deal is fundamentally different from any other deal Apple has done with a publisher; we came to fair and equitable agreement that allows both parties to own customers together.”
Now, all eyes are on Condé Nast, which has so far, been the most resistant to a deal under the general App Store subscription terms.