Market Insight

The Times bundles subsidised Nexus 7 with digital subscriptions

December 05, 2012


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Times Newspapers has begun to offer a subsidised version of the Nexus 7 tablet to new digital subscribers. Customers who commit to the £4.00 per week Times Digital service for 18 months will be able to buy the Google/Asus co-branded tablet for £50 on top of the cost of their subscription (the devices' recommended retail price is £199). Alternatively, a one-time payment of £299 will cover the 18 month subscription and the tablet. The latter option amounts to a saving of £212 when compared to a separate purchase of both items.

The digital subscription includes full access to The Times' website, tablet app, and the Sunday Times tablet app and the smartphone app. 

The Nexus 7 Digi Bundle with tablet/eReader devices is the first of its kind in the UK but not on the international stage. From January to March this year, a one-year digital subscription of the New York Times in the U.S. included a Nook Simple Touch at no extra cost or a Nook Color for $99. Both options granted the consumer a Barnes & Noble reading device at a $100 saving. Similarly, a one-year digital subscription to the People magazine gave access to a Nook Tablet at a cost of $199, a saving of $50. 

IHS believes that partnerships between hardware vendors and OTT content providers will occur with increasing frequency over the next few years. Well-chosen partnerships are vehicles to advance interests on both sides. In this case, Google is able to build brand equity by selling devices that are associated with a prestigious newspaper and, at the same time, improve device sales to an important set of costumers. On the content side, a subsidized device adds value to a publisher's digital subscription, which is likely to be important for driving adoption of mass market services. The idea has precedent in the mobile sector, in which operators subsidise handsets as a way of attracting and retaining subscribers, and is also commonplace in the pay TV sector - most pay TV operators worldwide now bundle a set-top box with their monthly subscription.

Geography
UK
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