Time Warner Inc.’s decision to shed its Time Inc. magazine unit last week underscores the challenges facing an industry that remains wedded to glossy paper even as the use of tablet computers, e-readers and smartphones explodes.

Although the new devices might seem to present an array of opportunity for Time Inc.’s 95 magazine titles, many publishers have found the digital transition troublesome. Digital editions of magazines represented just 2.4 percent of all U.S. circulation in the last half of 2012, or about 7.9 million copies, according to the Alliance for Audited Media.

Although that number more than doubled from a year earlier, it’s hardly gangbusters growth, considering that the number of tablets in the U.S. also more than doubled last year to 64.8 million, according to research firm IHS.

The fact that so few tablet owners are buying magazines on their devices is a concern because both ad and circulation revenue from print editions have fallen more than 20 percent since their peak near the middle of the last decade. And, according to forecasts, there’s no recovery in sight.

“We have to get much better at capturing those (digital) readers,” said Mary Berner, president of The Association of Magazine Media.

Before publishers can accomplish that, they need to address a number of problems, experts say. First, the range of free content on the Web has given some readers the impression that it’s not necessary to pay for the digital versions of magazine stories. Also, there’s no industry standard for pricing. Publishers aren’t in agreement over whether to include free access to digital copies as part of a print subscription.

There are technical challenges, too. It’s been difficult for magazine makers to create compelling digital editions that fit every screen size and resolution.

Berner acknowledges that customer confusion is part of what’s preventing the magazine industry from selling more digital copies. She is working with industry players like Time Inc., Hearst Corp., Conde Nast and Meredith Corp. to standardize both the format of magazines and the way they are sold.

“There used to be a couple ways you used to be able to get a magazine: you could subscribe or buy it at the newsstand. Now there’s 25 ways. Joe Average consumer just isn’t that clear on it yet,” she said. “The confusing part is hurting.”

Advertisers are making matters worse. The ad industry has been slow to warm to the notion that they still need to pay top dollar to advertise in the tablet editions of magazines, even though much cheaper website ads are just a finger-swipe away.

But many magazines still command significant premiums. A full-page ad in Elle magazine, for instance, costs $155,680 to reach the …read more
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