« November 2012 | Home | January 2013 »

Issue for December 2012

The Daily's Digital Death

Posted on Saturday, December 29, 2012 at 8:18 PM

Novel digital publication ends in failure. Is there a message in this for the rest of us?

By William Dunkerley

Rupert Murdoch launched The Daily in 2011 with a big splash. Now it's clear that the splash was the sound of something starting to sink.

Murdoch ended his digital venture on December 15, saying it "was an incredible vehicle for innovation and we're proud of the groundbreaking work we did but, ultimately, we were not able to grow as large an audience as we'd hoped."

A Litany of Excuses

What went wrong, and what can we learn from The Daily's mistakes? Insiders and outsiders alike are pointing to a litany of excuses for the failure. These excuses include:

--The Murdoch phone hacking scandal necessitated budgets cuts that went too deep.
--Readers' willingness to pay for content was a phenomenon that couldn't last long.
--Content sequestered behind a paywall couldn't produce enough social media buzz.
--The mobile advertising market is still too immature.
--Focusing on the iPad was a mistake.
--The app was too sluggish.
--Marketing focus wandered, so there was never a core audience.
--The multimedia work culture failed to become harmonious.
--Editorial slant became too conservative.
--It wasn't a must-read.
--The publishing model was too aggressive.
--Tablets are the wrong device for making money.
--The Daily was too ambitious for its own good.
--The publication was priced too high for what it was.

These factors may or may not have played a role in the publication's downfall. They do raise interesting points, however, that should have been considered in advance. Did the publisher consider these issues? What indeed was on Murdoch's mind?

Our only clues come from his pre-launch statements. At a February 2, 2011, gala launch event at the Guggenheim Museum in New York, Murdoch said his goal was to "make them think, make them smile, and help them engage in the great issues of the day." He added, "In the tablet era, there's room for a fresh and new voice." But did he have market research data to back that up?

His conviction that there was a market out there was summed up in his comment: "There is a growing segment of the population here and around the world that is educated and sophisticated but they do not read national print newspapers or watch television news." He continued, "But they do consume media. And they expect content tailored to their specific interests anytime anywhere."

The Grand Plan

Murdoch was going after the 50 million people who were expected to own tablets in 2011. How successful was he in doing so? The company had been tight-lipped about its statistics. Publisher Greg Clayman once quipped that subscribership was "more than one and less than one billion." The Daily was following a trajectory that for outsiders was hard to track. But by last February, Clayman started to loosen up. He told Pointer.org that the Daily had 100,000 subscribers and 250,000 monthly readers. He also said those numbers were consistent with company expectations. He seemed satisfied.

It's hard to reconcile that satisfaction with Murdoch's closure statement: "We were not able to grow as large an audience as we'd hoped." Were these guys looking at the same data?

Where Was the Ad Money?

While there was little early talk about audience numbers, the subject of advertising wasn't well covered, either. In March 2011, when we reviewed The Daily's launch, we puzzled over the absence of any information on the publication's website about how to advertise. As the publication shut down, no one was talking much about advertising, either. Even among the multitudes speculating on why the publication failed, not many are commenting on the issue of advertising.

Some publications find great success without creating a significant advertising revenue stream. Typically, these publications include exclusive newsletters, print or online. Their content is characteristically not available elsewhere, contains expert advice, and can be instrumental in making significant money. Subscription prices can go well over $1,000. But this wasn't the neighborhood The Daily was in.

The Daily should have taken a more sensible approach to ad revenue. Expecting to squeeze too much revenue out of readers proved to be quite shortsighted.

Perhaps Murdoch believed significant ad revenue wasn't really needed to achieve profitability. Early on, he told Ad Age magazine that The Daily wouldn't be expensive compared to traditional newspapers, what with their expensive presses, delivery trucks, and large staffs. At one time he bragged, "Our ambitions are high but the costs are low." They weren't low enough, it seems.

Multimedia Content

All of us should closely examine Murdoch's quest to give readers rich multimedia content. Did it truly serve reader needs, or was it just bells and whistles that added nothing substantial to the consumer experience? One insider offered the example of "puppet news." This was a video feature wherein puppets anchored a fake newscast. Satirical video puppet shows have proved to be a popular form of TV political commentary in some countries. But the inside observer claimed The Daily's rendition was "pathetic" and believes the budget it consumed could better have been spent shooting investigative news stories.

Multimedia content production also resulted in staffing issues. The Daily brought in video news veterans with network experience. Then there was the staff of traditional publication journalists. I wonder if they all had a unified vision of what they were there to accomplish. Reports say that most agreed the publication should have a Web presence but that management rejected the idea. The video folks reportedly felt constrained by the limitations of the tablet devices for which they had to produce.

An Unsuccessful Work Culture?

A fundamental aspect of good staff management is creating a shared vision of the organization's goals. Even under normal circumstances, this requires skillful management. The Daily had the added burden of orchestrating the work of people with specializations that traditionally don't interact with each other. Perhaps the job of creating a productive work culture received short shrift. The company probably should have brought in skilled outside organization development professionals who were up to the job.

The Central Issue

With all these things considered, though, I think there is one central issue that led to The Daily's demise: There was no need for it. That may seem overly simplistic and general. But the fact is that if there had been a strong demand for the product, it could have succeeded despite the stumbles it made along the way.

At the start Murdoch said, "We believe The Daily will be the model for how news will be created and consumed." That sounds more ideological than practical to me. He should have had more than a belief. He should have had some hard research results to indicate that there was a need for the publication.

Where did he get his belief that The Daily would set the world on fire? It couldn't have come from a good market analysis. Earlier, I researched to topic of consumer behavior vis-à-vis using tablets to read publications. I found that tablet news reading was not a popular activity. Research showed that new tablet owners toyed with reading publications on their devices, but when the novelty of that activity wore off, reading time plummeted. That didn't suggest an inviting environment for starting a tablet-only publication.

Victimized by Hype

Perhaps Murdoch fell prey to all the hype out there about a digital-only future. The device providers seem to be the principal hype-sters. Naturally, they want to sell their devices. But publishers need to be at least somewhat circumspect when they hear all the ubiquitous predictions. Some compared the relationship of the digital providers to the publishers to that of a con artist to a patsy. That's a bit too harsh for me. But publishers really do need to be more alert to the dangers of the prevalent and seductive claims being made.

Publishers who have yet to recover from the last recession are perhaps most vulnerable to promises for a miraculous new revenue stream from digital. They certainly should be exploring new digital opportunities. But they should do so in measured steps. In my experience, however, many slow-to-recover publications are saddled with unrecognized product flaws and organizational dysfunction. Addressing these issues should be a priority. Digital daydreams like Murdoch's can just become an obstacle to making practical progress that you can take to the bank!

In concluding our 2011 analysis of The Daily's startup, we outlined various flaws in the undertaking and recounted Murdoch's prediction that his brainchild would become a "model" for the digital age. Our conclusion: "Unless things change, it may be the model for how not to orchestrate an innovative launch!" Apparently it achieved its destiny.

William Dunkerley is principal of William Dunkerley Publishing Consultants, www.publishinghelp.com.

Add your comment.

Posted in (RSS)

Print Magazines in 2012

Posted on Saturday, December 29, 2012 at 8:17 PM

In the news: Digital is on the rise, but print magazines are still a major player in the magazine publishing industry.

Over the past year, we've linked a lot of articles about digital publishing. Every month, we hunt down news items about both print and digital magazines, but so much of the buzz has been about digital this year. Now that the year is coming to a close, however, we're starting to hear more about the state of print magazines, and the news is encouraging.

MediaFinder reports that 195 new print magazines launched this year-14 more print launches than in 2011. The most marked improvement, however, comes in the number of print magazines that closed this year-just 74, compared to 142 in 2011. This is good news indeed, particularly given the emphasis on digital publishing this year. Digital-only launches are down by nearly half this year (58 in 2011, 32 in 2012). This drop in digital startups reflects the magazine industry's ongoing struggle to monetize their digital content.

Read more about the 2012 print magazine industry here and here.

Also Notable

iPad Newspaper Shuts Down

Less than two years after its launch, Newscorps iPad-only newspaper, The Daily, has closed its digital doors. The closure comes as part of a planned NewsCorp restructure. In a statement, Rupert Murdoch stated that the digital newspaper was unable to build a large enough audience to keep the magazine afloat. He states that his companies will use some of the strategies employed at The Daily for its other publications. Some displaced staffers will transfer to the New York Post. Read more here.

Making Better Magazine Apps

On December 3, digital publishing gurus gathered for the MediaBistro App Summit. One panel of experts offered tips on how to create engaging apps. Some experts emphasized the importance of "addictive content," while others reminded digital publishers not to forget PCs in the magazine equation. Perhaps most interesting was the advice not to tie a publication down to an editorial calendar. Read more tips here.

Add your comment.

Posted in (RSS)

« November 2012 | Top | January 2013 »