Will NewsCorp take heed, or keep plodding along?
The emerging tablet market is seen as a savior by many in the publishing industry. It represents the first viable digital platform for the widespread distribution and consumption of subscription-based media. NewsCorp's new iPad-only periodical The Daily looked as if it might be the first harbinger of old media's resurgence. CNN was quick to copy with iReport.
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The Barren Goose:
Remember all the hype around Wired's big iPad app? While it launched to great fanfare and impressive sales, that momentum faded soon after launch. The first issue sold some 100,000 copies, but a year later those numbers were down by 70%. Wired (and many in the industry) blamed the decline on a lack of iPad subscriptions.
So surely The Daily, a subscription-based app, wouldn't have that same problem. Since NewsCorp claimed early downloads in the hundreds of thousands, that certainly seemed to be the case. But now Nieman Lab has released a study that contradicts this rosy picture.
Using Twitter-sharing as a barometer for readership, they've seen constant daily declines in The Daily's audience. While this isn't a perfectly accurate way of gauging traffic, it is a very good way to look at the general user trend. Nieman Lab described it as, "an early rush of excitement; a decline as people lost interest and the app struggled with technical problems; a plateau once the tech got sorted out; and then another decline once the app started charging users."
What this Means for Tablets:
When the iPad first launched, many in the industry saw tablets as a potential digital news-stand. The "slate" form factor allowed it to mimic a newspaper or magazine, but with an interactive social dimension. Consumers were expected to go crazy over this new opportunity to pay for high-quality content.
But NewsCorp et al. forgot one very important fact. People on the Internet don't spend money on content if they can absolutely avoid it. The Daily doesn't offer anything you can't get a billion other places on the Internet. You can argue that the quality of the reporting or the usability of the app is superior. But users aren't supporting that view with their money or their attention.
The question here is whether the content, or the paywall is what drove away users. The fact that activity declined once the app started charging is evidence that people are interested in what The Daily has to say, but not in paying for it.