Apple iPad – great for journalism, but still tough to make money

by John Einar Sandvand on February 12, 2010 · 7 comments

For journalists Apple’s iPad is great news. Just imagine how you can tell your stories in new, creative, multimedial and colorful ways.

For the business people in media companies, however, life gets even tougher. How to make money on this new device?

I was a journalist for many years. From 1997 to 2000 I was correspondent in Asia for Norway’s leading newspaper Aftenposten. Later I covered the Middle East, and I have kept travelling extensively to Asia, at the moment to write about Cambodia. And let me tell you: I would just love to tell my stories on Apple’s iPad! Imagine the situation: My readers (God bless them!) comfortably placed in their sofas, enjoying a glass of red wine on a Friday night, putting on soft music and then digging into the latest trends and thoughts on their iPad. And I would meet them with my stories from the world, adding smell and visuals, video and audio, graphics and the opportunity to dig deeper and deeper, making them understand and feel. They would listen to the wonderful people I met, see their faces, almost touch their agony and hopes and hopefully even enjoy the quality and color of my writing. What better situation could I wish for? What better tool? It beats the newspaper many times!

In short: Apple’s iPad is an amazing tool for storytelling. How great to be a journalist!

Yet these days I no longer work as a journalist. My title is Digital media strategist and I am well placed in the commercial part of Aftenposten‘s operation. One of my tasks is to find new ways to make money on our content.

And Apple’s iPad just made my life even tougher. You see, while it offers great journalistic opportunities, it just got even harder to make money on content online.

Don’t misunderstand me: iPad seems to be a fantastic device. Actually I think I might buy one myself – my 13 year old son already has pointed out that it should be great for watching videos (no, my son, you can still not have a TV in your room!). But as my job is to find digital income sources for a news company, reality is a little tougher.

Many media experts had hoped that Apple somewhat would revolutionize the business model for newspapers and all of a sudden present us with some hypnotic magic telling how we would trick people into paying for our content online. But they did not. In fact iPad was not much as a revolution even as a device. It provided no more than what we all had expected from Apple’s tablet weeks ahead. The only magic was the Steve Jobs’ magic, making anything he would present a wonder to the world. That guy would even be able to sell a newspaper as the glory of the future!

So what are we left with? A wonderful device, for sure. I think it will catch on and be tremendously popular. But for sure it did not give us any better way to make money. Users are thrilled. Developers are excited to use their creativity to make apps for iPad, hoping that they will be among the very few to strike it rich. But content owners are frustrated.

What are we facing?

On one hand a great web surfing tool. Users can flip through our web site with their fingers touching the screens like magic. I must admit there is a small problem: The device doesn’t understand Flash, the most common tool for video and interactivity on many web sites. But who cares? When Steve Jobs says “no Flash”, we just remove the Flash! We owe the greatest hero of our times that obedience. Why make a problem of a detail?

So they get to see our web site for free. Great! It is like a laptop PC. But now: How to make money?

Make an iPad app!, Apple says. Use the power of our platform to create an outstanding application! People will love it!  Also take advantage of the extremely easy payment system included in iTunes.

And they are right! But making an original and creative app for iPad is so hard. We are forced to reflect: What are the true elements creating Unique Value?  How can we give users an experience which goes far beyond what you will get at our free web site?

Is it impossible? Of course not! But it can prove to be very hard to make apps where users are willing to pay for content on a recurring basis.

That’s why I am so ambivalent. The journalist in me loves iPad while the business developer still got his grey hair.

But there is no reason to pity those of us who are in the news business. For so many years we enjoyed what for all practical reasons constituted a monopoly. We could do whatever we wanted – and still make money. So we deserve some true competition, don’t we?

The key question is of course: How do we create Unique Value in this new world?  Or put in another way: How do we produce scarcity in a content world of abundance?

One sure answer is: Do not copy your past! Just presenting the newspaper content in an iPad app, as New York Times seemed to do in the demo, will not be sufficient. Readers will expect more. If they are to pay, you must provide something that sticks out from the rest.

Many compare iPad to Amazon’s Kindle. As I have written before, I think that is missing the point.  However, for business developers there is a significant difference: On Kindle most of the content is paid for, while the vast majority of the content on iPad will be free. In fact that makes it much tougher to make money on the iPad platform than on Kindle.

Yet, what matters is which platform the users choose in the end. And it does not take an expect to predict that iPad will be one of the major platforms to take into account in the next couple of years. I am also confident that it will set a new standard for multimedia journalism and story telling.

So what should media companies do to prepare for the iPad launch?

My answer: Put together your best creative minds and challenge them to design the future of story telling! Give them freedom to think and work. But also ask them to make sure that what they come up with is truly unique, serving specific user needs and distinguishing itself from what you can expect your competitors to come up with. Especially it must be differentiated from what is freely available on the web or in other apps, not only in content, but also in functionality and experience.

Content is abundant – and so is probably most of your articles. So the question is really about the experience you create in your iPad app: Is it truly scarce?

It is tough, I know. But it is the competitive reality we are up against. As media companies we better prove that we are still able to create unique content experiences for our users. And I am sure some of us will succeed!

Share

Tagged as: , , , , ,

  • Tom

    and once you have your iPad application ready for your iPad customers to download on their iPad. You must add a little code to the top of your website that checks on which device the visitor is visiting your website. If it’s an iPad, it should redirect the visitor to a page where it tells them to download the iPad (tell them too that the experience will be much greater). It might not seem very user friendly at first to take away any access to the regular website for any iPad users, but I believe you will have to do this. and if your iPad application is really great. People will not mind (but only if your iPad app is really great!). Then, you will find new revenue streams from the iPad, for sure.

  • Pingback: The new visions of digital magazines | BetaTales

  • Per Helge Seglsten

    But iPad isn’t the only pad around. Say e-reader, and everybody goes “Kindle!” Say tablet, and everybody goes “iPad!” And of course Amazon and Apple are the two companies that has the most user friendly platform for buying content to their devices. But I really can’t imagine that they will be allowed to keep that position unchallenged for very long. So while we still are in charge of content, I think we should let Apple and amazone be, and consentrate on making platforms that enables us to offer our content on any device. There are so many hardware producers out there that if market and competition laws work as they usually do, the entrance fee for content on these devices will move towards zero, and the hardware producers will have to use technical specifications as the weapon in the fight for customers – as they’ve done up to now.
    However, if we can’t find a way to make advertisers happy on these new devices sometime real soon I don’t think we need to worry about who gets the revenue of our content anyway. I’m afraid it’s only a matter of time before mobile- internet- and search engine providers will provide the conent they need to make their adverticing spaces even more attractive. By buying up the old content providers, or by putting us out of business.
    I think e-paper and pads has an excellent chance of being a real blessing for newspapers and magazine publishers witihin very few years (will we even be printing at all in 7 years?), and as a guy who started his journalist career in 1987 with a typewriter and paper, I am really looking forward to publish the first 3D issue of Hjemmet on a housewife friendly tablet of some kind. But if we can’t find a way to sell ads in our digital future I’m afraid that future will not be like we hope it will.

  • http://www.betatales.com John Einar Sandvand

    Thanks for your comment, Per Helge!
    In my view the main fight in the longer perspective is not which technology will be best for e-readers/tablets, but which distribution platform that will dominate the consumer market.
    What I don’t like with Amazon and Apple is that they both so far has provided closed platforms for content distribution. From a business perspective I can see why they do it, but really it is not friendly to customers in the long run.
    My guess – and hope – is that they both will be forced to choose a more open path in the future – making it easier for content providers to produce for different platforms and for users to be platform-agnostic about where they consume the content they have purchased.

  • Pingback: How newspapers offer less Unique Value than before | BetaTales

  • Pingback: Waiting for the second generation digital media product | BetaTales

  • Pingback: Waiting for the second generation digital media product | Digital Asset Management

Previous post:

Next post: