Tablet Metrics From iMonitor

iMonitor™
Trends & Best Practices
March, 2011

© McPheters & Company, 2011

BACKGROUND

•  iMonitor™ was launched in June 2010 to allow publishers
and agencies to share the cost of thoroughly monitoring
developments in tablet apps.

•  iMonitor uses more than 100 variables to track iPad apps
for: — All magazines released globally
— National newspapers in English-speaking and Western
European countries
— Other news apps which compete with national newspapers
— and magazines
— Companion apps

•  We also track which other platforms these publishers are
using and pricing across all platforms

© McPheters & Company, 2011 2

•  Each app is subjected to rigorous evaluation and rated
on a 5-point scale for:
— Design
— Functionality
— Media
— Advertising, if applicable

•  We roll the first 3 into the iMonitor™ App Rating

•  As of today, we have evaluated more than 1500 apps –
most more than once.


BY THE END OF FEBRUARY, THE NUMBER OF
APPS TRACKED BY IMONITOR SURPASSED
1400.


IT IS STILL VERY EARLY…

•  Tablet adoption

•  App development


THE U.S. MARKET
By 2015, the number of tablet users in the U.S. will be
almost 7 times current levels.

Source: Forrester; McPheters & Company estimate of users in 2010 & 2011.


THE IMPORTANCE OF BEING APPLE

•  Apple is expected to retain a 60-70% share of tablet sales
through 2012

•  To date, competitors to the iPad have failed to get traction

•  According to Laptop Magazine, a recent survey of tech
-savvy consumers indicated:
— 20% already have an iPad
— 20% more expect to purchase an iPad
— 7% expect to purchase another tablet
— 53% don’t (yet) want a tablet


APPLE DOMINATES THE APP MARKETPLACE, PROVIDING YET
ANOTHER REASON FOR CONSUMERS TO PREFER THE iPAD.

Source: Laptop Magazine; 148Apps,Google, RIM, Precentral


•  Not surprisingly, the evolution in the experience these
apps provide consumers since the iPad’s introduction
has been enormous.

•  Nonetheless, we still find that 44% have significant
glitches that negatively affect the user experience.
— Download issues
— Crashes
— Failed links
— Faulty video
— Difficult page turns


DISTRIBUTION OF PUBLICATION
-RELATED APPS BY MEDIUM IN THE U.S.

Print Mags Digital Mags Newspapers
Other News Companions


MOST MAGAZINE APPS ARE STILL REPLICAS.

% Portrait and Landscape Same or Single Page/Spread
100%

90% 86% 86%
83% 84% 82%
80% 79%
80% 76%
72%
68% 67%
70% 64%
63%
60% 57%

50% 47%
44% 43%
40% 36%

30%

20%

10%

0%
9/27 10/25 11/29 12/23 1/27 2/25

MRI-Measured U.S. Magazines Non-Measured U.S. Magazines International Magazines

Source: iMonitor 2/25; Base: Apps containing advertising


IN U.S. WHO’S THERE; WHO’S MISSING
PRESENT ABSENT
•  All major national newspapers •  Bauer (4 foreign titles)
•  51 MRI-Measured Magazines •  Meredith (3 companions)
(MRI, other pubs, companions) •  Wenner
— American Express (2, 0, 0)
— AMI (2, 0, 1)
— Bonnier (4, 7, 1)
— Condé Nast (7, 2, 4)
— Hachette (2, 0,1 )
— Hearst (4, 0, 4)
— MSLO (2, 0, 1)
— National Geographic (2, 0, 6)
— Rodale (4, 1, 1)
— Source Interlink (2, 0, 1)
— Time (4, 0, 8)
— Other titles (16, 0, 7)


Most major U.S. magazines have a dual revenue model, while
among newspapers, an ad-based model is slightly more
prevalent.

Revenue Model
90%

80% 77%
71%
70%

60% 57% 56%

50%
39%
40%
33% 33%
30%
30%
20% 19%
20% 14% 14%
11% 11%
10% 4% 5% 5%
0% 0% 0%
0%
Consumer + Ad Consumer Only Ad Only Neither
MRI-Measured U.S. Magazines Non-Measured U.S. Magazines U.S. Newspapers
U.S. Companions Other U.S. News Apps

Source: iMonitor 2/25

Most major U.S. magazines derive their consumer revenue from sales of
individual issues – with less than 20% offering subscriptions. Newspapers
are more likely to derive consumer revenues from apps and subscriptions.

Consumer Revenue
100%

90% 86%

80% 74%
70% 66% 67%
62%
60%
51%
50%

40% 34% 33%
30% 28%
22%
17% 15% 19%
20% 14% 15% 13%
11%
10% 8% 8%9% 7% 7% 7% 7% 7%
2%0% 0% 0% 0% 2% 2%0%0% 0%
0%
App + Internal App Only Internal Only Issue Sub Other None



Among major U.S. magazines, apps typically carry a price upon
introduction which includes the first issue. When the second issue is
released, the app becomes free and the issue is sold within the app.

Distribution of Prices, MRI-Measured Magazines
100%

90% 85%
80%

70%

60%

50%

40%
28%
30%
23%
19%
20% 15%
10% 6% 6% 8%
2% 0% 2% 0% 2% 4%
0% 2% 0% 0%
0%
Free $0.99 $1.99 $2.99 $3.50 $3.99 $4.99 5.99 NA

App Issue


What we refer to as a print advertising model is dominant for
magazines, while other app types are more likely to offer sponsored
or premium opportunities for advertisers.

Ad Model
90%
81%
80%

70%
62%
60%

50% 44%

40% 36%
33%
36%
31%
30% 25%

20% 14%
10% 11% 11% 11% 10% 11%
10% 7% 6%
4%
1% 0%
0%
None Print Premium Sponsored



LINKS ARE THE MOST COMMON
FORM OF AD ENHANCEMENTS.
Ad Enhancements
100%
100%

90% 84% 83%
82%
80% 74%
70%
63%
60% 55%

50%

40% 33% 33%
30% 25%
22%
20% 17% 17%
14%
10% 11%
8%
10% 5%
0% 0% 1% 0% 0% 0% 2%
0%
None Web Links Audio Video Interactivity




WHAT MAKES
A GREAT APP?


A GREAT APP PROVIDES A SIGNIFICANTLY
ENHANCED EXPERIENCE
WELL DESIGNED

•  Has features which make it easy to navigate app, issue,
sections (newspapers), and articles

•  Optimized for orientation

•  Extra points awarded for
— Subscriptions
— Unique features such as:
• Glamour’s Shopping List
• Hearst’s Cookie Carousel
• SI’s Wheel
• The Daily’s article shuffle


ENHANCED EXPERIENCE
HIGHLY FUNCTIONAL
•  Driven by adherence to evolving set of best practices related to
time and resource conservation
— Reasonable download time
— In-app purchase
— Navigation guide
— Internal browser
— Resumable download and reading
— Ability to delete issues

•  Points added for unique features such as
— Macumag: Adjust screen brightness within app
— TELE: Clear cache from settings
— Sunday Times of London: Download and delete by section
— Quattroruote: Navigation guide overlaid on page

•  Points deducted for replicable malfunctions


ENHANCED EXPERIENCE
LOTS OF RICH MEDIA CONTENT

•  Points added for various types of features (links, audio,
video, animation, social media, live newsfeeds, localization,
interactivity, transactional capabilities)

•  Points added for unique media features
— EPICURIOUS RECIPES & SHOPPING LIST: Create
shopping list for multiple recipes
— EVERYDAY FOOD: Send recipes via text message
— GEO MAG N°4: speak a country's name to bring
up photo gallery
— NY POST: Design your own cover for the day’s newspaper


BEST CONSUMER APPS
iMonitor
iMonitor

BEST
APPS
–
U.S.
App
Ra6ng

BEST
APPS
-‐
INTERNATIONAL
App
Ra6ng

CBS
News
for
iPad
14.5
Focus
Magazine
14.5

USA
TODAY
for
iPad
14
CHIP
14

FOOD
&
WINE
13.5
Story
Magazin
14

Intelligent
Life
13.5
T3
14

The
Wall
Street
Journal.
13.5
Project
Magazine
14

The
Washington
Post
for
iPad
13.5
Sunday
Times
14

Martha
Stewart
Makes
Cookies
13.5
Good
Food
Magazine
13.5

ELLE
US
13
Weekend
Magazin
13.5

FORTUNE
Magazine
13
Andaman
365º
13.5

Glamour
Magazine
13
iMAG
Magazine
13.5

Golf
Digest
Magazine
13
ZEIT
ONLINE
plus
13.5

TIME
Magazine
13
Harvey
Norman
Recipe
Organiser
13.5

New
York
Post
13
Etapes
HD
13.5

ABC
News
for
iPad
13
elmundo.es
for
iPad
13.5

AP
News
13
News
Magazin
13

Epicurious
Recipes
&
Shopping
List
13
Schweizer
Illustrierte
eMagazin
13

Marie
Claire
Fall
Fashion
A
to
Z
13
Suomen
KuvalehS
13

JPM
Magazine
13

Financial
Times
iPad
EdiSon
13

Frankfurter
Rundschau
13


TOP APPS IN CONSUMER TRACTION (FEB.)

Free
Rank
Chg.
Paid
Rank
Chg.
Gross
$
Rank
Chg.

New
No
No

The
Daily
1
New
York
Post
1
New
York
Post
1

Release
Change
Change

New

CNN
App
for
iPad
2
-‐1
60
Minutes
for
iPad
2
1
The
Daily
2

Release

In
the
Kitchen:
Food
Network

No

USA
TODAY
for
iPad
3
Recipes,
Chefs,
Cooking
Tools
3
-‐1
PEOPLE
Magazine
3
-‐1

Change

and
Shopping
Lists

O,
The
Oprah
Magazine
The
New
Yorker

NYTimes
for
iPad
4
-‐2
4
1
4
1

February
2011
Magazine

No
New

PEOPLE
Magazine
5
Vogue
5
NYTimes
Crosswords
5
-‐2

Change
Release

New
York
Daily
News
iPad
New
York
Daily
News

The
Wall
Street
Journal.
6
-‐2
6
-‐2
6
1

version
iPad
version

O,
The
Oprah
Magazine
New
Sports
Illustrated

ABC
News
for
iPad
7
-‐1
7
7
8

March
2011
Release
Magazine

Epicurious
Recipes
&
No
Martha
Stewart
Makes
Not

8
8
6
Popular
Science+
8

Shopping
List
Change
Cookies
Ranked

Ul6mate
Dinopedia:
The

No

NPR
for
iPad
9
-‐2
Most
Complete
Dinosaur
9
2
WIRED
Magazine
9

Change

Reference
Ever

Martha
Stewart

Not

The
Economist
on
iPad
10
-‐1
Popular
Science+
10
Living
Magazine
for
10
-‐2

Ranked

iPad


KEY DRIVERS OF CONSUMER TRACTION

•  Apps are of high quality with average iMonitor™ rating of
11.5 vs. average of 8.5.

•  Issue/update frequency

•  Availability of subscriptions

•  Little correlation with print circulation

•  More to do with nature of the audience


PLATFORMS/DEVELOPMENT PARTNERS
Multi-publisher developers active in the U.S.

Top Range # of Apps Avg. App Avg. Design Avg. Avg. Media
Rating Rating Function Rating
Rating
Woodwing 120 10.6 3.8 4.0 2.8

Adobe 82 10.3 3.5 3.9 2.9

Zinio LLC 14 9.5 3.7 4.1 1.7

YUDU Ltd 20 9.3 3.1 4.4 1.8

Texterity Inc. 67 8.8 3.1 3.7 2.0

Pixelmags 127 8.7 2.8 4.8 1.1

BlueToad, Inc. 57 7.8 2.7 4.2 0.8


No matter how good the development partner, quality control
is essential and is the responsibility of the publisher.

Minimum & Maximum Ratings
15.0
14.0 14.0

12.5 12.5
12.0
11.0
10.5
9.5
9.0
8.0
7.0 7.0
6.5
6.0 6.0
6.0
5.0

3.0

0.0
Woodwing Adobe Zinio LLC YUDU Ltd Texterity Inc. Pixelmags BlueToad, Inc.

Min App Rating Max App Rating


MAJOR TRENDS


MAJOR TRENDS
•  Redefinition and convergence

•  Social media (used by 41.7%)

•  Transactional capabilities (used by 15.3%)

•  Localization (used by 2.8%)

•  Shopping lists (used by 0.2%)

•  Voice recognition (used by 0.1%)

•  Move towards fixed orientation


REDEFINITION & CONVERGENCE
•  Recent introductions, such as Project and POST Matter,
expand our perception of a magazine

•  Frankfurter Rundschau redefines the daily newspaper so
that it’s indistinguishable from a magazine

•  Convergence is especially notable in the news category,
where apps from newspapers, magazines, TV, radio and
web-based brands compete directly


REDEFINITION
PROJECT


REDEFINITION
FRANKFURTER RUNDSCHAU


CONVERGENCE
THE NEW YORK DAILY NEWS


CONVERGENCE
ABC, BBC, & CBS


SOCIAL MEDIA
THE NEW YORK POST


SOCIAL MEDIA
CHEVY – VANITY FAIR


SHOPPING LISTS


SHOPPING LISTS & TRANSACTIONAL CAPABILITIES

GLAMOUR


SHOPPING LISTS & TRANSACTIONAL CAPABILITIES
OPRAH


MULTIPLE VERSIONS
FT
PROJECT


LANGUAGE
JPM Magazine


LOCALIZATION
AT&T – SPORTS ILLUSTRATED


LOCALIZATION
NEWSDAY


VOICE RECOGNITION


We give higher ratings to apps that optimize viewing
separately for portrait and landscape.

% Magazines Optimizing Layout for Both Portrait & Landscape
40% 38% 38%
37%
35% 35%
32%

30%

23%
20% 20%
20% 18%
15%
13%
12% 12%
9% 10%
10% 8% 8%

0%
9/27 10/25 11/29 12/23 1/27 2/25




Among major U.S. magazines, and to a lesser extent
international ones as well, we are seeing a trend towards the
use of a fixed orientation.

% Magazines Using A Fixed Orientation
30%
26%

22%
21% 21%

20%

13%
13%
12%
11%
10% 9% 9%
8% 8%
7% 7% 7%
6%
5%

0%
0%
9/27 10/25 11/29 12/23 1/27 2/25




WHAT MAKES
GREAT ADVERTISING?


LIKE A GREAT APP, A GREAT AD PROVIDES A
SIGNIFICANTLY ENHANCED MAGAZINE
EXPERIENCE
•  Added opportunities for interaction and engagement

•  The ability to take action
— Learn more
— Locate dealer
— Purchase product

•  Lots of rich media content

— Points added for various types of features (links, audio,
video, animation, social media, live news feeds,
localization, interactivity, transactional capabilities)

— Points added for unique media features


EXAMPLES
MARTHA STEWART LIVING


North Face
EXAMPLES
NORTH FACE


Examples
EXAMPLES
RALPH LAUREN IBM


EXAMPLES
ABC FAMILY


APPS WILL RULE

•  Tablet penetration is a fraction of what it will be by the
end of this year, and a much smaller fraction of what it
will be in 5 years

•  Most major publications have yet to enter the app space.
A year from now, consumers will be able to assume that
their favorite publications have apps

•  A disproportionate share of apps have problems that
negatively impact the consumer experience

•  It is not yet easy for consumers to browse apps for
something to read and publishers have not figured out
how best to market them

•  Consumers want subscriptions and for most
publications they are not yet available.


IT IS STILL VERY EARLY…


THE END


Tablet Metrics From iMonitor

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