Dallas Morning News To Senate: Amazon Kindle Is Not A Business Model For Newspapers
This story was written by Staci D. Kramer.
Rupert Murdoch wasn't the only one taking out after Amazon and Kindle the same day it announced a pilot program with the New York Times and the Washington Post. Turns out the subject came up during the U.S. Senate subcommittee hearing on the future of newspapers. Dallas Morning News Publisher and CEO James Moroney spoke up after Arianna Huffington raved about its potential as an option, telling the subcommittee that Amazon wants the lions' share of the revenueand expansive licensing rights. Moroney: "They're not a platform that's going to save newspapers in the near term." (HuffingtonPost is one of the blogs available for subscription through Kindle, as is paidContent.)
Moroney, who would like to see a limited anti-trust exemption so publishers can talk about pricing, thinks that would help when it comes to negotiating with a company the size of Amazon (NSDQ: AMZN). He told the Senate: "The Kindle, which I think is a marvelous device, the best deal Amazon will give the Dallas Morning News>and we've negotiated this up to the last two weeksthey want 70 percent of the subscriptions revenue. I get 30 percent, they get 70 percent. On top of that they have said we get the right to republish your intellectual property to any portable device. Now is that a business model that is going to work for newspapers? I get 30 percent and they get the right to license my content to any portable devicenot just ones made by Amazon? That, to me, is not a model. Maybe what Plastic Logic comes up with or what Hearst comes up with, might provide a good model but today Kindles are less than 1 percent penetration in the U.S. market. They're not a platform that's going to save newspapers in the near term."
The exchange starts here. (pop-up C-SPAN player.) Full video embedded below courtesy of C-SPAN.
By Staci D. Kramer