When Ads Feel Wrong

Marco Arment wrote about the negative impression he had when, after paying $4.99 for a single digital issue of The New Yorker, he was nonetheless subjected to advertisements. He calls the combination of up-front purchase combined with an advertising subsidy “double-dipping,” implying that the content providers are somehow charging you twice for the same product.

I just don’t feel comfortable paying for an iPad or web publication, no matter how good it is, and then having ads shoved down my throat. It makes me feel ripped off: what did I pay for?

His article touched a nerve with some of my friends and colleagues who are tied into the publishing industry, and who are aware of how important ads are to the revenue models of many magazines.

I think that I get, and agree with, the gist of Marco’s complaint. For better or worse, paying $4.99 for a digital copy of a magazine feels like a premium price. When you pay a premium price for content, it just feels wrong to many of us to have ads heaped on top.

Jason Snell, the Editorial Directory of Macworld, reacted to Marco’s post by suggesting that a magazine’s delivery medium shouldn’t affect whether or not ads are justified:

@marcoarment Wait, so an iPad version of a magazine shouldn’t have ads, but it’s okay in a printed magazine?

Jason goes on to suggest that publications have many costs, and typically the purchase price only pays for a fraction of those. Jason also links to a blog post from Craig Grannell, who also hammers the idea that publications need ads to cover costs, and closes with a quippish reply to Marco’s “what did I pay for?” question:

How about the content, and the wages of the people who write the content, and who design the app?

This epitomizes what I think is an overreaction by many folks to Marco’s post. People are zeroing in on the objection to ads, and inferring that Marco doesn’t believe magazines should be reasonably compensated for the content they provide. Marco never suggests this. In fact, he’s the one who ponied up $5 for a copy of content that he values. The exact price, and whether it supports the specific business model of the company he is patronizing, is almost beside the point. To him, it just feels wrong.

In response to the criticism, Marco seems willing to acknowledge that his feelings about the ads are trumped by the realities of the industry:

Tons of feedback from magazine/news people telling me that my feelings are wrong and that I simply need to accept that ads are necessary.

Peter Cohen, a journalist with years of experience writing for publications such as The Loop and Macworld, minces no words in his response:

@marcoarment It’s not your feelings, Marco. It’s your understanding of the economics of content production.

This is all well and good, informing Marco how wrong he is for feeling that $4.99/issue is a price that should justify an ad-free reading experience, but nobody seems to be willing to go deeper than vaguely condescending dismissal. All the accusations of contempt and ignorance are a little unsatisfying without specific analysis of Marco’s allegedly mistaken assumptions.

Obviously a magazine costs more than $0/issue to put out, and obviously it costs less than, say, $500/issue to put. Marco’s expectation to read a digital copy of a magazine without ads seems well-warranted if the cost of the purchase compensates the magazine with enough money to pay all of their staff, all their service providers, and some money left over for, if they’re lucky, pure profit.

If Marco had paid $500 for that issue of the New Yorker, I think few would challenge his expectation that such a price warrants an ad-free experience. But he paid $4.99, which happens to be the same price as a newsstand copy of the magazine. When you compare $4.99 to the $1.49/issue that The New Yorker charges its loyal subscribers for paper copies, printed on glossy paper and mailed to their homes, it already feels like a huge premium. Presumably the publishers are not losing money at $1.49/issue (with ads), or they’d cease selling subscriptions. [Update: it’s been pointed out that they may well lose money on subscriptions if they know they can capitalize on secondary sales of books, etc., to their customer base]

We don’t know how much The New Yorker pays for bandwidth, or what percentage of their overall expenses the cover price accounts for. We don’t know if there are partnership fees for the digital version, or whether it needs to pay back a major infrastructure investment. We don’t know the specifics. We just know that Marco paid $3.50 more than a subscriber pays for the same issue, that it didn’t have to be printed, that it didn’t have to be mailed, and that it’s offered for sale in a venue where practically no other editorial content is sold at a premium price.

Is there something wrong with paying $5 for a digital copy of a magazine only to be subjected to ads? I don’t know. It may be necessary. It may be fair. But it felt wrong to Marco, and it feels wrong to me. That’s the publishing industry’s problem to figure out, and ours to complain about until convinced, by reasoning and without blanket condescension, to think otherwise.