Why did Murdoch's Daily iPad 'newspaper' fail?


by Magnus Shaw.

Do you read The Daily? Unless you own an iPad style tablet you probably don't. Even if you do, you won't for very much longer. The Daily is a digital newspaper, published by Rupert Murdoch, available on tablets and closing any day now. Not the end of the world, but it does beg the question: if Murdoch, can't make daily digital news a success, then who can?

This rather depends on your definition of success. The Daily had 100,000 global subscribers, paying either 99c a week or $46 a year for the publication. Many websites - and indeed some papers - would surrender a limb for that sort of traffic. But for a venture like The Daily, this figure falls very short of the necessary punters. First, the operation cost $30m to develop - a sum News Corp would have been hoping to recoup. Then there's the weekly running cost of half a million dollars. At that rate, the 'paper' would have needed around 500,000 customers to break even, possibly more allowing for cancellations and churn. So the stakes were higher than we might imagine.

Nevertheless, The Daily's content was proficiently readable and well presented, so what was the problem? In short, Rupert was the problem. Of course it was his company's money that created the title in the first place, but it was his influence that hobbled it. Murdoch, whatever you think of the man, is a master of the printed newspaper. The Sun is the most profitable daily in the UK and the envy of all its rivals. When Rupert bought the paper in 1969 it was almost bankrupt, but thanks to the downmarket lessons he'd learnt in his native Australia, he was able to create the model for Britain's modern tabloids. He also saw the potential in multi-channel TV when it was considered a short-lived novelty by his competitors. But his approach to digital platforms has been rather skewed. As the web opened multiple, free information channels to a connected planet, Murdoch threw up paywalls around his websites - reducing user numbers by the million. In Rupert's world, readers and viewers must always pay for content. Unfortunately, hundreds of other providers don't see it that way and the same news is available from thousands of sources without a price tag. That was an insurmountable challenge for The Daily.

Murdoch's adherence to tradition also affected the project in other ways. It was published daily, just like a regular print edition. But most electronic news outlets update in real time. Nobody needs to await a fresh morning to absorb fresh stories these days. Unless they depended on The Daily, that is. If the customer is persuaded to spend on a digital publication (and that's a hard sell, as I've described) they expect a lot more than just an inkless newspaper.

Interestingly, the title also felt it necessary to add weighty writers to its roster. Indeed, a large slab of the start-up costs were consumed when famous names were brought on board, in the same way a glossy magazine would launch. It seems logical and proven. Columnists - well-known for their wit and skill - bring regular readers and subscribers. But this is less true in the digital arena. Yes, the audience is attracted to writers they enjoy, whatever the platform, but are considerably less willing to pay for the privilege when that platform is an app or download. There are some incredibly popular bloggers out there, but very few of them charge for access to their columns. (You'll notice you are reading Creativepool's splendid blog without reaching for your credit card). Unfair as that might be, it's an absolute fact of the online environment and one with which News Corp should have been familiar.

Other clunky decisions undermined The Daily's progress too. Although recently it has been available on Android devices and Amazon's Kindle, at launch it was an iPad only thing. By any measure that was an ill-considered move. Apple's kit may be supremely hip and trendy, but to limit an ambitious new publication to a single machine is self-defeating, as it excludes masses of potential readers at a stroke.

Having had a truly horrendous couple of years, News Corp is now forced to literally cut its losses - excising businesses failing to pay their way. Under this regime, The Daily was an obvious candidate for the chop. So let's not lose heart. The ever-evolving technology universe certainly has room for many, highly successful, digital publications; some already in existence, some yet to come. And hopefully they will learn from the failures of The Daily, avoiding mistakes and building business models which accounts for the shifting subtleties of the new media.

I'd be surprised if any of them belong to Rupert Murdoch though.

Magnus Shaw is a writer, blogger and consultant.


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