Tablet Journalism: Can Rupert Murdoch’s iPad Adventure Save the News Business?

2/4/11Follow @wroush

Sorry for the sensational headline. I couldn’t help myself. Talking about the future of journalism just gets me fired up, I guess.

Anyway, the answer, of course, is no. Rupert Murdoch’s new initiative, called The Daily, can’t save journalism in an Internet era when advertising rates have declined and everyone wants to get their content for free. But now that the iPad-only newspaper has launched, I find myself far more intrigued and energized by it than I had expected to be. You can bet that editors and designers at older publications are dissecting the app as we speak, and figuring out how to go The Daily one better. The upshot is that we’re going to see a lot of experimentation in the news business over the next couple of years, and that’s exciting.

The fun started on Groundhog Day, when Murdoch and the publication’s executive staff unveiled The Daily at a news conference in New York. The free app, developed by Murdoch’s News Corporation at a cost of $30 million, is a vehicle for something untried in the annals of journalism: a general-interest news operation built entirely around the Apple iPad.

If you’re wondering why someone would start a major daily newspaper that can only be read by people who’ve shelled out $499 to $829 for an iPad, then you may not have heard that Apple shipped 17 million of the things in 2010 and will likely sell tens of millions more this year. That’s a pretty large “addressable market,” as a VC might say. If just 500,000 iPad owners decide they’re willing to pay $0.99 a week for a subscription to The Daily, the operation will be profitable. (That’s based on Murdoch’s statement at the launch event that The Daily is “running at a cost of less than half a million a week,” and it assumes that The Daily will sell no advertisements at all—which it already has.)

Plus, the publication will eventually be available on all major tablets, according to Murdoch. With every major electronics manufacturer rushing to enter the market Apple has opened up, worldwide tablet shipments are expected to climb to more than 70 million in 2012. So let’s just dispense with the question about whether The Daily makes sense as a business proposition. If it doesn’t now, it soon will.

The Q&A portion of Wednesday’s launch event was interesting to watch, because you could just see the journalists in the room squirming inside. As they probed for flaws in the concept, you could tell that they were all wondering what Murdoch’s gambit might mean for their own publications—approximately none of which were created with tablets in mind.

For most publications, even digital-only ones, “online” means the Web, e-mail, and RSS. The publications big enough to be able to afford it—CNN, the New York Times, the Wall Street Journal, the Washington Post, GQ, Vanity Fair—have built their own iPad apps. But for the most part, these apps are weak reflections of their parent publications, with an incomplete selection of content, uninspiring design, and interfaces that make limited use of the iPad’s capabilities. That’s why startups like Flipboard and Alphonso Labs (makers of Pulse) have been able to find hundreds of thousands of users for iPad apps that make other organizations’ content prettier and more navigable (Flipboard just surpassed 1 million users, actually).

What Murdoch realized is that big, established publications may still be the kings of content, but they aren’t very quick to reinvent themselves when new distribution technologies emerge. Ten years down the road, the Wall Street Journal and the New York Times will have shut down their printing presses and will be universally read on tablets, or e-paper, or retinal implants, or whatever we’re using by then. But The Daily is there now. It doesn’t have to … Next Page »

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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  • rick sass

    You raise some very valid and interesting points about The Daily, and I must confess I have not seen it yet. But I have read a great deal about it (for free, online :-)), and I was in the print business for more than 25 years including more than 20 with industry leader USA Today (in circulation/distribution by the way).

    While I admire Mr. Murdoch’s efforts and spunk, let’s take a look realistically at the core issue here: can The Daily get Ipad and other tablet-device users to plunk down $.99 per week for digital content they largely can get for free elsewhere? And if they can, will they be able to grow a “circulation” base of 200k-500k daily users? USA Today at its peak hit 2.2M daily “purchasers”, more than a third of whom did not really realize they were purchasing the product. Assuming Mr. Murdoch can get “sponsors” to agree to similar “third-party” purchases, he may have a chance (although I’m not even convinced of that likelihood).

    But the bigger issue is who is likely to go the “true purchase” route, vs. who has purchased (and will continue to purchase) the Ipad and similar devices. It’s not the 50+ year-old traditional news-consumers. It’s the tech savvy gen-x and gen-y folks more interested in Itunes and cool video game apps. And let’s be honest, as compelling as The Daily’s content might be to “newsies”, that is not the crowd who live their lives through Ipads and other digital devices. I frankly don’t see the draw for younger users. And without that draw, there is no chance of success. Period.

    So can Mr. Murdoch build a base “circulation” of 200k-500k “younger” users/buyers (although I’m betting true sustainability lies north of 700k – which, by the way is larger than the circulation of every US print newspaper not named USA Today, WSJ or New York Times) and keep those numbers? I frankly don’t see it happening with a product like this one. It’s not cool enough!

    And from everything I have read about this new venture, the content simply is not that compellingly good in comparison to what is available for (drumroll please) FREE. It is the newspapers themselves, coupled with Google, Yahoo, and all of the other free online news sites that sink this venture. The one thing Mr. Murdoch has going for him is very deep pockets and a will/desire/ego to see this thing succeed.

    In my experience it rarely is the first product out of the blocks that ultimately wins the race. Unless Mr. Murdoch finds a “Willie Wonka” draw out there somewhere. And we know from experience that readers who come onboard that way will not stick unless the content is truly compelling. I wish Mr. Murdoch and his team luck, but suspect they will need a lot more than luck and spunk to succeed.

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