Hearst, Apple Strike a Deal

First major magazine publisher to sell subscriptions through iTunes

Hearst has entered into a deal with Apple making it the first major publisher to sell digital subscriptions to its magazines through the iTunes store, The Wall Street Journal reported.

Starting next month, Hearst will sell subscriptions to Esquire, Popular Mechanics, and O, the Oprah Magazine for $1.99 per issue or $19.99 per year. Customers can sign up for subscriptions through the magazines’ iPad apps and be billed automatically. Hearst said that it plans to start offering newspapers and other content as well.

Publishers have long sought to reach an agreement for a subscription model with Apple, but talks have been filled with disputes over who would have greater control over the subscription process and customer information. For their part, publishers felt Apple was treating them as run-of-the-mill app developers. Many still do. (At one point, Apple’s vp of Internet services, Eddy Cue, angered publishers by comparing their content to the game Angry Birds). Hearst said its recent deal comes after months of negotiations.

Publishers have been allowed to offer content for Apple products on their websites, but any content offered directly to consumers must be available in the app store, where Apple takes a 30 percent cut of all sales. In the past, publishers had to ask customers to separately pay for and download each new issue. That system is automated in Hearst and Apple’s new service, making it simpler for customers to download new content, and easier for Hearst to charge them.

Sources told The Wall Street Journal that other publishers are becoming more open to selling subscriptions to their publications through the iTunes store, too. Publishing execs believe that Apple will eventually be more flexible with pricing and sharing information about subscribers.