Publishers of newspapers and magazines who see potential for great reading experiences in Apple’s forthcoming iPad should be careful what they wish for. The device, if sufficiently successful, could be the next major blow to print publishing—possibly a fatal blow.
To be sure, the potential gain from the iPad is, no doubt, real. Take The New York Times, the publisher of the most-viewed newspaper or magazine Web site anywhere. Today, the Times offers a site that is comprehensive, creative, rich, and deep, constantly updated, and taking great advantage of many of the new tools and techniques the Web offers. But the Times site, however well executed, remains a Web site—a “sit forward” experience, highly imperfect for narrative reading, and nearly impossible to use in a manner that yields a sense of completion, a feeling of having read it all the way through, that can be a critical attribute of something to which you “subscribe.”
Thus, it has been clear, for perhaps three to five years, that any sudden conversion of all print readers to Web readers, while greatly reducing costs, would reduce revenue even more, deepening losses at unprofitable papers and throwing those that remain profitable into losses—losses that would likely be impossible to reverse except through huge further expense cuts, especially in newsrooms. The downward spiral in product quality would be accelerated, likely leading to fewer readers and more cuts.
Unfortunately, nothing about the iPad, as wonderful as it looks and feels, holds out the promise of avoiding this problem. It is hard to imagine how ads delivered on an iPad could garner a price three, four, or five times that for today’s online ads. But that is what would be required for a profitable transition.
On the circulation side, things look better, but not better enough. iPhone apps, the analogy on which charging for content on an iPad will likely be based, are amazingly inexpensive; many powerful apps are free, and $10 a year buys robust services—with Apple keeping a big cut for itself. It may be easier to charge iPad subscribers than it has been on the Web, but charging them even a decent fraction of what the Times, for instance, charges print subscribers—more than $600 per year after introductory discounts have expired—seems like a pipe dream.
One report from The New York Times earnings call this week noted that expectations for the iPad as a new platform for its content among analysts seem muted. But it could be far worse than that. Having early adopters of the iPad look at your content seems like a dream come true. But having them like it enough to substitute it for your print product would be a nightmare.