At $5 an issue for the digital copy, traditional print publishers are making themselves sitting ducks for up and coming startup publishers, a la Huffington Post, who will know how to leverage the iPad platform. If they don't adapt to this new world of digital, they're going to whither away (as they have been) with freebie Websites.
Fortune, here's how you do it (from the Basic Business 101 textbook): you build your iPad reader base at, say, a $1.50 or $2 an issue. At this low price point, you are getting them used to paying (which is about as convenient as it gets with iTunes). You then actively gather user input from your readers, progressively optimizing your new digital magazine for this powerful platform. Readers become increasingly devoted to Fortune as new features and 'wow factor' elements are added. As readership grows, you gradually introduce modest price increases (from, say, $1.50 to $1.99 and up). Make sure you don't alienate your readers by the price increases, and do so only to get your bottom line profits to acceptable levels.
That's it, it's not rocket science! What you need to do is get rid of the old fuddy duddies in your management ranks who are clueless about this strategy. Bring in young people who are devotees of people like Steven Jobs, management leaders who do get it. It's ironic that I'm having to tell a magazine like Fortune about how it's done, but you clearly need help!
