Media owners cash in on the apps gold rush

Alex Blyth reports on how the smartphone boom is opening up a fast-growing new revenue stream, as media firms rush to create mobile apps for their content. Plus: Media Week rates ten of the latest media owner apps

The Guardian's app: downloaded 100,000 times within two months of its launch
The Guardian's app: downloaded 100,000 times within two months of its launch

It is easy to see why the media world is getting so excited about mobile apps: quite simply, consumers love them.

Colin McCaffrey, director of products at apps developer 2ergo, which created the Guardian's app, explains: "Apps are simple to download and use, and they are packaged so people feel comfortable paying for them."

There are currently more than 150,000 applications in the Apple apps store and more than 10,000 apps designed for Google's Android mobile operating system.

Last September, Apple announced that more than two billion apps had been downloaded from its apps store; by March, it had passed three billion. Comscore estimates that 32% of the 228.5 million mobile subscribers in the UK, France, Germany, Italy and Spain are using apps - a market of 74 million people.

Media companies have been quick to jump on the bandwagon, with the Telegraph, the Guardian and Sky among the many firms creating app versions of their content. Sky tested the water with its Sky News app last May, and it has since launched Sky Plus, Football Scores Centre, Cricket Scores Centre and, most recently, Mobile TV.

Paul Berney, EMEA managing director at the Mobile Marketing Association, says: "Whether media owners charge for content upfront or via subscription, or they go down the ad-funded model, apps give them an opportunity to generate revenue."

He adds: "Just as importantly, mobile apps provide a way for media owners to give consumers information and entertainment when and where they want it, helping their brand become a trusted, ever-present companion."

The London Evening Standard and the Economist are among those joining the apps gold rush this year. Tim Smith, the Standard's general manager of digital, is launching the paper's first app at the end of this month. He reveals: "The app will be free to users and we are already close to signing major sponsorship deals around it."

Oscar Grut, the Economist's managing director of digital editions, is "scoping out" the potential for an app, following reader demand. He explains: "We want to be wherever our readers are. The Economist's business model is all about subscribers paying for content, and I expect this will also be the case with our app."

However, KF Lai, chief executive of mobile media company BuzzCity, warns the ad revenue from apps can be overhyped. "In May 2009, AdMob served advertisements to 2,300 mobile apps, 54% of which had fewer than 1,000 users. If you assume each user sees ten ads per month and the going ad rate is $2 per thousand views, the application is likely to generate about $10-20 per month in ad revenue."

It is also important to not to rush in with a poorly executed app. Jerome Jacques, director of mobile business development at Keynote Systems, says: "To be successful, media owners must ensure the applications are running as they should, regardless of the end-user's handset or network. This is a significant challenge, given the variety of devices and browsers on the market."

Meanwhile, the news that the BBC is planning to launch its own news and sports apps for the iPhone has shaken commercial news providers. The Newspaper Publishers Association is calling on the BBC not to launch into the apps market, arguing that its entry would undermine the commercial sector's ability to establish an economic model, as it has done with the provision of online news.

However, despite the notes of caution, the apps market is still set to grow in 2010. Brad Rees, chief executive of mobile insight agency Mediacells, says: "The smartphone market is likely to expand to 32% of total mobile market share in UK in 2010.

"This translates to about 25 million UK citizens who will have at least one mobile internet experience. In 2009, Google burst into the market and instantly snatched 3.5% global market share. This year is likely to bring greater Android presence in mobile, bolstered by the launch of Google iClones like the Nexus One."

The message for media companies is clear: ignore apps at your peril.


Ten media owner apps rated


1) Media owner: Time Out

Name of app: Time Out/Smirnoff

Cost of download: Free

What it offers: Time Out's app uses geo-location to tell you what is on in your local area; you can invite friends, book tickets and read reviews.

Media Week verdict: Packed full of information, easy to use and with handy features such as "Inspire Me", this app should prove popular with Londoners who don't mind the fairly prominent Smirnoff advertising.

Score: 8/10


2) Media owner: Associated Northcliffe Digital (DMGT)

Name of app: localpeople

Cost of download: Free

What it offers: Localpeople allows you to write and read news and information on local restaurants, bars, hotels, tradesmen, shops and services.

Media Week verdict: An idea with potential, but it is only as strong as the content input by users - there is limited coverage to date.

Score: 5/10


3) Media owner: Eurosport

Name of app: Eurosport

Cost of download: Free

What it offers: Users can keep abreast of the latest sports news, tailor it so you see the sports that interest you, and share news with friends.

Media Week verdict: The app has a neat, clear layout, is very easy to use, and features an impressive array of sports.

Score: 9/10


4) Media Owner: Telegraph Media Group

Name of app: The Telegraph

Cost of download: Free

What it offers: Latest news from the daily paper in text, photo and video formats.

Media Week verdict: A simple and effective app that is marred only by reliability complaints following a recent update.

Score: 7/10


5) Media owner: Guardian Media Group

Name of app: The Guardian

Cost of download: £2.39

What it offers: The Guardian app, which offers subscribers content from the UK's most-visited newspaper website, had been downloaded by 100,000 people within two months since launch in December 2009.

Media Week verdict: A stylish and easy-to-use app that could be improved by the ability to comment on articles.

Score: 8/10


6) Media owner: ITN

Name of app: ITN News

Cost of download: Free

What it offers: ITN, which launched the app in February 2009, bills its app as "the first video-focused news app".

Media Week verdict: Criticisms over loading speed and the predominance of football stories mar an otherwise simple and appealing app.

Score: 6/10


7) Media owner: BSkyB

Name of app: Sky Sports Live Football Score Centre

Cost of download: Free

What it offers: Text coverage of every game in England and Scotland, as well as Europe's top football leagues and international matches.

Media Week verdict: Sky's most popular app has proved a hit with football fans. However, the text update can be a little slow and erratic, and a goal alert function would improve the service.

Score: 8/10

8) Media owner: Financial Times

Name of app: FT Mobile

Cost of download: Free

What it offers: Three free articles per month (seven if you register and unlimited access to subscribers), market data and a currency converter.

Media Week verdict: High-quality content is available for subscribers, although it is irritating that the app fails to recognise website log-in details. Non-subscribers seeking free market news may go to Bloomberg.

Score: 5/10


9) Media owner: Bauer Media

Name of app: Empire Movie Guide

Cost of download: £2.99

What it offers: About 9,000 constantly updated film reviews, sharing facilities and a direct link to iTunes for easy purchase of films.

Media Week verdict: The app offers in-depth quality reviews of the film archive, but users complain there are too few reviews of recent releases.

Score: 4/10


10) Media owner: Associated Newspapers

Name of app: Metro UK

Cost of download: Free

What it offers: Metro's app, which offers regional, national and international news on the move, was downloaded more than 100,000 times within two weeks since its launch in January 2010.

Media Week verdict: The app is more like a PDF version of the paper than a genuine mobile app - it is difficult to navigate and read.

Score: 4/10