Is Next Issue the Spotify for Magazines?

Over the weekend I posted a question wondering why no one has done what Spotify has done for music and Netflix for movies. The fact that no one has stepped in to offer a bundled subscription for another “old media” type, the magazine & newspaper, seemed like an opportunity to me that made economic sense.

Yesterday, Next Issue, a company that had been doing exactly that on the Android platform jumped up with the launch of their iOS app which brings together all you can read from almost 40 magazines, for one monthly flat fee.

The publications are from their investors Condé Nast, Hearst, Meredith, and Time (full list of magazines on offer and their parent companies are listed on paidContent). Their basic plan is for $10/month while for $15/month you get access to additional “premium” magazines such as The New Yorker, People, and Sports Illustrated.

Now that the solution is here, would you go for it? The reception seems mixed. A shortcoming that my colleague at GigaOM has noted is the lack of social features. The web has forever changed the way we read. Both in how we discover what to read and again in the way we share what we’ve read. I think I saw Dave McClure wearing a shirt once that said, “If you can’t share it, it doesn’t exist” – this is the future, this is the way to growth.

It’s not clear to me how Next Issue will be able to roll in social into their subscription-only product. As with other paywalled sites, sharing of Next Issue articles will not work unless they get creative because subscribers will know that they’re sending out dead end links to their non-subscriber friends.

Social sharing will work if enough people can access what you’re sharing so a network effect kicks in. This is starting to work with Spotify because they have a free, ad-supported subscription so all you need to do is register and install the app to listen. The hope is that after enough listens, you’ll get hooked on the product and up-sell to their ad-free subscription product.

Without sharing, there will be no social discovery. Without social discovery, you’re stuck with what’s on the newsstand shelf and how the articles are presented to you by each publication. This is the way it used to be, this is the way to stagnation.

So how can Next Issue grow it’s subscriber base so that social sharing can kick in and drive further subscriber growth? I suggest two options.

1. Create an ad-supported freemium client that lets those that follow links put out by Next Issue subscribers get a taste of the product. They have a 30-day free trial but it requires a credit card, that is too high a barrier, it needs to be totally free and dead easy to install. This is probably not an option as there is almost no reason to convert to a paid subscription if such a free product exists. That leaves the next choice,

2. Do a deal with a major brand such as American Express or Microsoft to underwrite enough subscriptions as a membership benefit so that you get an install base large enough to encourage broad sharing between subscribers and a community of “haves” that are sufficient to encourage those without to sign up either with the sponsor or Next Issue directly.

The future is with sponsored subscription bundles. Not only for Next Issue but for Spotify and Netflix, all these services will take off when the media buyers put together deals which pay for these memberships. I have a bunch of United Airlines miles but would much rather use them to pay for my Spotify subscription than another cramped trip in a tin can on an airline.

Sponsored subscription bundles. That’s my big bet. It’s the future of the subscription business model and the future of brand advertising.

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