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Wednesday, September 15, 2010, 09:05 am PT (12:05 pm ET)

Apple rumored to announce newspaper subscription plan for iPad

Apple will soon announce a newspaper subscription plan for the iPad, introducing a revenue sharing model similar to the one that has been employed for applications sold on the App Store, according to a new rumor.

According to the sources that spoke with the San Jose Mercury News, Apple has agreed to implement an opt-in function to allow subscribers to share their personal information with publications. Print publications rely on that information to share demographic data with advertisers.

Earlier this year, before the iPad was even released, publishers and Apple apparently struggled to reach a deal, as Apple was reluctant to share consumer data beyond sales volume. Advertisers and publishers, on the other hand, consider demographic data to be the "most valuable asset."

Author John Boudreau spoke with Roger Fidler, head of digital publishing at the Donald W. Reynolds Journalism Institute in Columbia, Mo., who said that the anticipated plan will likely resemble the current App Store model, which would give Apple a 30 percent cut of all subscriptions sold through the digital download service. In addition, Apple could take as much as 40 percent of the advertising revenue from those applications.

Fidler also indicated that publishers are not pleased with the deal, as they would rather pay Apple a fee than a cut of their subscription and advertising revenue.

"They had hoped to offer app editions as part of subscription bundles that include print versions of the paper," the report said. "Instead, they must use Apple as an intermediary with subscribers."

Publishers have struggled with Apple in bringing their content to the iPad. At first, the Cupertino, Calif., company did not allow subscriptions to magazines through the App Store. But that impasse was broken in August, when People magazine became the first publication to offer subscribers free access to its iPad application.