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Apple, Time Inc. reach terms on iPad distribution

If you can get the biggest players to sort terms out, the rest will follow.

Per the Wall Street Journal, Time Inc., the largest magazine publisher in the U.S., has reached a deal with Apple to allow print subscribers of its titles to download iPad editions for free.

The article reports that Apple and Time have reached a deal, which stands as a vital turning point in the impasse between the iPad maker and publishers over digital subscriptions.

According to the report, the iPad editions of Sports Illustrated, Time and Fortune will support subscriber authentication starting Monday. People magazine began supporting free subscriber downloads last year, ahead of other titles from the publisher.

The deal has reportedly gone through in spite of an executive shakeup occurring at the company. In February, parent company Time Warner fired Time Inc. CEO Jack Griffin after just six months on the job, citing a clash of management styles as the reason.

According to the report, Time and other major publishers have not reached a deal for selling digital subscriptions to the iPad editions of their magazines. Publishers are reportedly hung up on Apple’s insistence that the practice of forwarding subscriber information to publishers operate on an opt-in basis.

Maurice Edelson, general counsel for Time, told the Journal that the company’s executives have held frequent meetings with Apple executives, including Eddy Cue, vice president of Internet services. The Time executives “say the latest deal to make iPad editions free for print subscribers is a sign the two sides are moving closer,” according to the report.

Earlier this year, The New York Times reported that publishers such as Time Inc., Conde Nast and Hearst were frustrated with delays to Apple’s then-forthcoming application subscription feature for the App Store. At the time, people close to the company’s discussion said that Time had yet to strike a deal with Apple.

Apple sparked a controversy in February when it revealed that it would take a 30% share of income generated from in-app subscriptions to an App Store app. In addition, publishers must match or better prices from subscriptions offered outside of the app and are not allowed to link to out-of-app purchases.

In response to the news, one subscription service called the terms “economically untenable,” while one developer called Apple’s new rules “a huge dick move.” The U.S. Federal Trade Commission is in the preliminary stage of looking into the terms of Apple’s App Store subscriptions.

However, not all publishers are dissatisfied with Apple’s terms. Bloomberg announced a US$2.99 monthly subscription for the Bloomberg BusinessWeek app in April, adding that the company was “pleased with Apple’s terms.”

“iPad is the most important place to be right now, and that’s where we’re focused,” said Bloomberg mobile head Oke Okaro.

Stay tuned for additional details as they become available.