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Publishing's Future with the iPad

The magazine and newspaper business could use a savior.

Digital ads aren't compensating for the decline of subscriptions and print advertising.

Apple's iPad provides a ray of hope: it's forcing magazine publishers to adapt to a new dynamic format, a format that promises dual revenue streams.

Just two to three million iPads are expected to be sold this year (according to Forrester) so the gadget is unlikely to revolutionize the media business over night. But it does serve the crucial role of keeping the magazine medium relevant to consumers, and it lays the groundwork for more significant revenues as this business expands. Importantly, it gets consumers used to paying subscriptions for digital content.

There are a number of looming questions: How much will consumers pay for iPad content? And how will ads be priced? But despite plenty of uncertainty publishers and advertisers are jumping in.

The Wall Street Journal plans to charge $17.99 for a monthly iPad subscription, which is less than a standard print subscription for the year and more than the $1.99 weekly charge for the Journal's online subscription. Advertisers are lining up -- the Journal iPad app will launch with ads from Coke and FedEx.

Time Inc. is making a big push onto the iPad with its magazines, which will cost somewhere around the cover stand price. Time will launch right out of the gate with an edition ready to load on the iPad right after it goes on sale. The high-end early adopters who will buy the iPad are earning Time a real premium. Big names including Unilever , Toyota, and Fidelity are shelling out $200,000 for iPod sponsorships. One factor working in magazines' favor is the fact that they can charge extra for the video and interactivity that the iPad affords.

Sports Illustrated isn't launching its first iPad edition until June. But back in January it showcased some of the high-tech bells and whistles it'll be able to offer on the tablet format. Apparently thirty advertisers immediately lined up to get on board. For content like sports, the iPad's interactivity seems particularly valuable.

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