Right after the iPad launch event, Jobs traveled to New York in February 2010 to meet with executives in the journalism business. In two days he saw Rupert Murdoch, his son James, and the management of their Wall Street Journal; Arthur Sulzberger Jr. and the top executives at the New York Times; and executives at Time, Fortune, and other Time Inc. magazines. “I would love to help quality journalism,” he later said. “We can’t depend on bloggers for our news. We need real reporting and editorial oversight more than ever. So I’d love to find a way to help people create digital products where they actually can make money.” Since he had gotten people to pay for music, he hoped he could do the same for journalism.
Publishers, however, turned out to be leery of his lifeline. It meant that they would have to give 30% of their revenue to Apple, but that wasn’t the biggest problem. More important, the publishers feared that, under his system, they would no longer have a direct relationship with their subscribers; they wouldn’t have their email address and credit card number so they could bill them, communicate with them, and market new products to them. Instead Apple would own the customers, bill them, and have their information in its own database. And because of its privacy policy, Apple would not share this information unless a customer gave explicit permission to do so.
Jobs was particularly interested in striking a deal with the New York Times, which he felt was a great newspaper in danger of declining because it had not figured out how to charge for digital content. “One of my personal projects this year, I’ve decided, is to try to help—whether they want it or not—the Times,” he told me early in 2010. “I think it’s important to the country for them to figure it out.”
During his New York trip, he went to dinner with fifty top Times executives in the cellar private dining room at Pranna, an Asian restaurant. (He ordered a mango smoothie and a plain vegan pasta, neither of which was on the menu.) There he showed off the iPad and explained how important it was to find a modest price point for digital content that consumers would accept. He drew a chart of possible prices and volume. How many readers would they have if the Times were free? They already knew the answer to that extreme on the chart, because they were giving it away for free on the web already and had about twenty million regular visitors. And if they made it really expensive? They had data on that too; they charged print subscribers more than $300 a year and had about a million of them. “You should go after the midpoint, which is about ten million digital subscribers,” he told them. “And that means your digital subs should be very cheap and simple, one click and $5 a month at most.”
When one of the Times circulation executives insisted that the paper needed the email and credit card information for all of its subscribers, even if they subscribed through the App Store, Jobs said that Apple would not give it out. That angered the executive. It was unthinkable, he said, for the Times not to have that information. “Well, you can ask them for it, but if they won’t voluntarily give it to you, don’t blame me,” Jobs said. “If you don’t like it, don’t use us. I’m not the one who got you in this jam. You’re the ones who’ve spent the past five years giving away your paper online and not collecting anyone’s credit card information.”
Jobs also met privately with Arthur Sulzberger Jr. “He’s a nice guy, and he’s really proud of his new building, as he should be,” Jobs said later. “I talked to him about what I thought he ought to do, but then nothing happened.” It took a year, but in April 2011 the Times started charging for its digital edition and selling some subscriptions through Apple, abiding by the policies that Jobs established. It did, however, decide to charge approximately four times the $5 monthly charge that Jobs had suggested.
At the Time-Life Building, Time’s editor Rick Stengel played host. Jobs liked Stengel, who had assigned a talented team led by Josh Quittner to make a robust iPad version of the magazine each week. But he was upset to see Andy Serwer of Fortune there. Tearing up, he told Serwer how angry he still was about Fortune’s story two years earlier revealing details of his health and the stock options problems. “You kicked me when I was down,” he said.
The bigger problem at Time Inc. was the same as the one at the Times: The magazine company did not want Apple to own its subscribers and prevent it from having a direct billing relationship. Time Inc. wanted to create apps that would direct readers to its own website in order to buy a subscription. Apple refused. When Time and other magazines submitted apps that did this, they were denied the right to be in the App Store.
