CORRECTION: Mark J. Undercoffler, spokesman for Chase, writes in to
As a follow up, we wanted to correct the figure being used or quoted for the amount Chase paid for this partnership. The dollar amount you provided is inaccurate; In fact, Chase paid less than half of the amount you quoted.
We’ve removed the “Million-Dollar” before “iPad Sponsorship” from the headline. The original article proceeds below.
According to an article yesterday by TBI Research, a branch of The Business Insider (registration required; summary available here), Chase Bank spent around $1 million to sponsor The New York Times‘ iPad app.
Says TBI Research’s Rory Maher:
While this number is respectable ($1 million to sponsor an app noone has seen yet isn’t bad), it certainly won’t be enough to sustain any softness in print advertising during that 3-6 month period. As a point of emphasis, the $1 million in sponsorship is equal to about 0.04% of the New York Times Company’s overall annual revenue.
In other words, the initial sponsorship of the Times‘ iPad app won’t draw nearly enough revenue to meaningfully impact the company. Maher also says that companies are relying heavily on iPad subscriptions to drive revenue. He’s skeptical about that strategy too, but maybe it explains why magazines like Time are charging so much for their apps.