Jeff Jarvis: Why iPad’s ‘The Daily’ News App Failed
Rupert Murdoch's iPad-only venture neglected key lessons of subscription news, and that is why it folded.
On Twitter, I’ve already been accused of schadenfreude over the death of News Corp’s soon-to-die, paywalled, tablet-only, once-a-day news venture called The Daily.
Not so. I’d have loved to have seen an online-only news service make it. But The Daily was, in my view, doomed from the start because of all the adjectival modifiers listed above.
First, the paywall: NewsCorp proprietor Rupert Murdoch has charging for content as a religion. He says people should pay for his products (though I’ve never seen a successful business plan in a competitive market built on the verb “should”). He turned his Times from an internet presence of note into a footnote because he insisted upon putting it behind a wall.
With The Daily, Murdoch wanted to prove that he could start and we would buy a news product online. But he forgot a key lesson of selling subscriptions, one he surely learned when he owned magazines: that it takes a lot of marketing expense to acquire customers. It costs money to charge money.
When it started, I calculated that The Daily would need to net at least 750,000 subscriptions – 1m when accounting for cancellations (aka “churn”) – to break even on an operating basis, what with a share of sales going to Apple on the iPad. Murdoch promised he would sell “millions.” In the end, it reached 100,000 subscribers, not nearly enough to compensate for a reported $30m in development cost and $500,000 per week burn rate.
Mind you, I am not against charging for content. I will happily sell you my books. But The Daily wasn’t much worth paying for. Though it looked quite nice and its content was competent, that content was all-in-all just news and news is a commodity available for free in many other places. Larry Kramer, publisher of the much-larger USA Today, just said with admirable candor that he can’t put up a pay wall online because his product “isn’t unique enough”. Ditto The Daily.
Next, The Daily started as an iPad-only offering. Eventually, it branched out to the iPhone and to Android tablets (but only for Verizon customers) and the Kindle. I hope that other publishers learn from this misguided “mobile” strategy. Too many have dreamed that the tablet would return to them the control over brand, experience, and business model that the web and its links took from them. Too many think they need to create new products just for so-called mobile devices (though we actually often use them when stationary, at desk or on couch).
No, a news organization should have a strategy built around relationships with individuals, serving them wherever, whenever, and on whatever platform they like. My needs don’t change just because the device in my hands does.
Finally, there was the absolutely befuddling decision to make The Daily daily. News was only ever daily because it was forced into that limitation by the means of production and distribution of print. The internet freed us from those shackles of time. Why put them on again? Nostalgia?
In the breakup of News Corp. that is the real outcome of the London news scandals and the Leveson inquiry, the new company had to start cleaning up its books, getting rid of money-losing ventures. The Daily was the first to go. But there are more in that stable, starting with the New York Post, which loses, by one account, $110m a year just to give Murdoch what he has long callsed his “bully pulpit.” Now he has a bully pulpit with almost four times more subscribers for free on Twitter. Can The Post’s obit be far behind?