Will People Pay for App-Based News Publications?

Are App-Only Publications the Answer? News Corp. Aims to Find Out

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A couple weeks ago, reports surfaced that News Corp. was working on a new app-only publication. Even before much was known about the project, some heralded it as a "game changer". I find that notion to be a bit premature.

Will this be a game changer? Tell us what you think.

As time progressed, we heard more about how excited Rupert Murdoch had become about tablets. The Guardian ran a piece quoting him as calling them "the perfect platform" for cheap and convenient, up-to-date News Corp. content.

While it is still in the early stages, a little more information is coming out about News Corp.’s project. The LA Times says the publication would have its own dedicated reporting and editing staff, but may still draw from other News Corp. content. This would of course be paid content.

Dawn C. Chmielewski reports: "If green-lit, News Corp. could invest anywhere from $30 to $40 million in the venture, according to a person with knowledge of the situation. New York Post executive editor Jesse Angelo would oversee the separate digital news operation, in addition to his responsibilities at the tabloid."

How much does the iPad really change news?Chmielewski goes on to say that this would directly compete with the New York Times, USA Today, and other national publications. I see more than one glaring issue with this. Most people do not own tablets. Yes, iPad sales have been impressive, and the device is starting to get some competition. There’s no doubt in my mind that tablet use will continue to gain popularity, but the fact remains, it will be a while before these devices are in everyone’s hands or even reach cell phone or PC status. Granted, the app would be available for phones as well, but clearly the tablet factor is what is generating the hype – the bigger, more magazine-like feel that can be achieved.

Another flaw? How about the fact that the web is still available on tablet devices and mobile phones. While tablet owners may prefer reading on their tablets, there is still plenty of free content that could keep the majority of readers from paying.

That’s not to say this project will be a complete failure, and it is clearly experimental, but it still stands to reason that app-only content will face many of the same obstacles as print content, in addition to the limited use of tablets, and limited size of phones.

A pre-iPad study (conducted by Forrester in November) found that 80% of consumers wouldn’t access news sites if they had to pay. Will this really change with apps?

Forrester - Would You Pay for Content?

Another more recent study from the USC Annenberg School for Communication & Journalism also found that consumers aren’t too willing to pay for content (including Twitter, though Roger Ebert’s Twitter followers felt differently).

Do you see yourself paying for news content app subscriptions? Let us know.

Will People Pay for App-Based News Publications?
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  • http://lanta-krabi.blogspot.com/ Lanta

    The Times London has repotedly lost 90% of its readers since the paywall went up, so I guess that is a big NO, people wont pay for news. The average interent user is just a headline reader without loyalty or the patience to actually read something worthwhile paying for.

    I`m still not sure about tablets/phones replacing computers, to me they still seem like “checking devices” – checking email, checking facebook, checking twitter, checking headlines etc and not something to replace anything with a proper keyboard and mouse.

    Sure people will pay $999 to make their iphone shine red and people will pay for news but as time goes on that 10% will become 5% and continue downward as the readers see it a expese they don`t really have to pay for.

    • Chris Crum

      I think a lot of iPad users are already basically converting their iPads into laptops sometimes through the accessories.

  • http://lanta-krabi.blogspot.com/ Lanta

    The Times London has repotedly lost 90% of its readers since the paywall went up, so I guess that is a big NO, people wont pay for news. The average interent user is just a headline reader without loyalty or the patience to actually read something worthwhile paying for.

    I`m still not sure about tablets/phones replacing computers, to me they still seem like “checking devices” – checking email, checking facebook, checking twitter, checking headlines etc and not something to replace anything with a proper keyboard and mouse.

    Sure people will pay $999 to make their iphone shine red and people will pay for news but as time goes on that 10% will become 5% and continue downward as the readers see it a expese they don`t really have to pay for.

  • Guest

    No, I don’t see it as a viable idea.

    However, don’t discourage Mr Murdoch.

    I’d love to see News Corp waste 30 million dollars on this.

  • http://www.medlawplus.com medlaw

    I paid for a CNN iPhone app so I could watch videos. It was a one-time charge of like $5. I wouldn’t have paid more. For me, the motivation was the video. I liked the idea of being able to check in on the latest CNN news clips from my mobile device. Would I have paid for print news content? No. Never. There is plenty of great free print news content. And news corp thinks users will pay a monthly subscription fee for print content? Just because it is optimized for the iPad? Good luck with that one.

    • Chris Crum

      I think people are much more willing to pay a small one-time fee for an app itself. A monthly fee for a subscription might be a different story. Some will pay, but I don’t know how large that number will be.

  • SirCanuck

    there is a reason why the majority of APPS are free, cuz people hate having to pay for things….Why would anyone pay to read news on the Iphone or Ipad when they can go buy the news paper itself…..Now as a few mentioned if it is a 1 time small fee you have to pay when installing the APP and not having to pay anything more later on then it would work and work well in some places if the news APP has video….Altho I would not pay for it myself but then I am not into the Iphase

  • http://greenheritagenews.com Guest

    I find people won’t pay for news also. The Shreveport Times brought up the problem a couple of years back, and publications that have tried it fail.

    But here’s something people might not believe, that is true, I have found. I write news written in a vocabulary upper high school through doctoral level, on objective material, raw science distilled in comprehensible form, facts about health from serious facts, clean and mean and green most of the time. Editorials are separated entirely. No politics, for the most part. Guess what? The site is growing much faster than a local paper with lots of politics and is now ten times bigger than that one that has been around for months. Mine I just started 2 1/2 months ago. I do believe people will respond when they find something valuable, when news is not dumbed down, and when people are treated like reasonable people. Even the unreasonable on science and objective data will write and thank me for reporting it.

    I think we have gone off the deep end to the extent people don’t trust the media. As a journalist who has long since past middle age and counting–that certain age women won’t admit–with decades of writing experience, I don’t trust much of the media as well. My reason? Knee jerk responses, lack of fact-checking and the need to be loved as opposed to truly serving the public.

    I do believe those who earnestly serve the public will survive. The question is: will we go broke or become too fatigued in the process?

    Sources of income for online news must be developed because without good information, objective, soundly provided we are lost with respect to freedom, wherever we are.

  • http://www.websiteresults.co.nz millionleaves

    The iPad has been out barely 10 minutes and you’re suggesting that this idea won’t fly because most people don’t have tablets yet?

    We’ve already seen the iPod/iTunes combination completely disrupt the music business and convince people to pay for music online. Sure, it’s possible to get free music online but for many people it’s too hard. iTunes made it easy.

    Similarly, you can find pretty much any content online you want for free. Finding quality content online is easier than finding free music, but if you want content of quality and reliability you have to look harder, and most people settle on a few sources they trust and pretty much stick to them for their regular news.

    Unlike most other people commenting here, I totally agree this is a game changer. App-based content on a tablet or iPad will be easy, so people will buy it. The payments may be small, but the volumes will eventually make it viable. It won’t work for all content, but there will be content you can’t get anywhere else. Someone else noted the reduction of the Times UK’s readership when they introduced a paywall. That was unsurprising; one day there was no wall, the next day there was a total wall. That doesn’t mean that paid content online is doomed to fail.

    A better model is the National Business Review in New Zealand which put up a limited firewall in 2009. At the time I made predictions like some of those published here, i.e. that their online readership would drop and they’d be forced to retreat. But I was wrong. A lot of content is still free, but their subscriber numbers have risen steadily since the launch. People like the content, but get frustrated by the “Subscriber only” message on the best content. So they subscribe. I have no doubt there are plenty of variations on this model around the world where the publishers are just getting on with it and monetizing their content online.

    Rupert Murdoch has deep pockets and knows how to play a long game. I predict that this venture will succeed. Perhaps not immediately, but it will set a new paradigm for paid content on the internet. If you’re nay saying on this one, are you sure it’s not just because of your antipathy to Murdoch? This is still a brave new world for publishing. We think the rules have been rewritten, which is true, but we shouldn’t forget that they are still being rewritten as we speak. We don’t know what the final playbook will look like – or when it will emerge.

    • http://www.trafficact.com.au jeniPa

      We so will pay for content on our tablets. The iPad is today what the Gutenburg Press was in 1843. It will eventually change everything. It is simply time for the big content providers to invest in this new technology, and invest big so they do not lag behind when it reaches the tipping point.

  • http://montanamoney.blogspot.com/ Sam

    I will not pay for this app to read the news. I would rather read a newspaper. Plus I can get all the news I want for free on the internet from more sources than I could ever read.

    • Peter Corby

      I absolutely agree with Sam. Inso far as News Corp is concerned you’d have to pay me to access it!

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  • http://thecomputergal.com Nora McDougall-Collins

    I believe that subscriptions to print newspapers basically pay for the delivery charges and advertising pays for the rest of the cost. Advertising rates are somewhat based on readership; so, anything that hurts readership hurts advertisers and therefore hurts the publisher.

    On the other hand, I pay for my online Wall Street Journal subscription and don’t feel like I’m being cheated.

    On the third hand, if all online news content is paid, it will further widen the digital division between haves and have-nots.

  • http://pcsmartech.com Henry

    Frankly speaking, I used to read news on the internet from local coffee shop(various location) from morning to mid-night. The point is I seldom see people carry Tablet,Cellphone, but 99% them are Laptop or Netbook user.These people mostly chat on Social networking sites, read emails and playing game online.

    There are already so many authority sites posting great free contents. I think people also have too many sites to surf through without paying for ages. Suddenly, you hope they pay for an app, are they willing to come out their pocket money just to serve the purpose.

    Perhaps, this takes time to change internet reader from rejection into acceptance.
    For whatever the turnout result might be, I wish IPad success.

  • http://learnwithmariogarcia.com/ david rose

    i think people wouldn’t pay for app just to read news, there are news magazines everywhere and newspapers.

  • Mike Willis

    Right now I have to wait on my aps to load from an Intel X-25M SSD. That just isn’t a very long wait! I don’t think I could get used to waiting on them to load over the net (when the net is up). I think this speed difference is a cloud killer for most folks.

    Newspapers on tablets are a whole ‘nother matter. I agree with Rupert Murdoch. It’s perfect. Absolutely perfect. For my local paper and a few others, I’d pay. Not as much as I’d pay for a paper version delivered to my door, but I’d definitely pay.

  • http://www.pitriff.com chris

    Murdoch, like so many who’ve seen their business model killed by the advent of the net, continues to be delusional. There’s only one way this dumb idea can work – if Google starts charging for news. But that won’t happen, and in fact guys like Murdoch going to a pay format will only strengthen Google because people will go there before paying. As long as Google offers it for free, it will drive people to their site…even more so if Fox, CNN, MSNBC, etc. start charging.

    Ask ESPN how charging for content is going. The first thing I do when they post something on their “Insider” is go to foxsports or SI or Sporting News and find the story.

    These guys don’t understand the following:

    1. most of us have no real loyalty to their product.
    2. most of us have never felt that their product was worth the cost, but were forced to pay it because there weren’t alternatives.
    3. none of us have any real interest in if their business continues or goes away.

    Non-payer right here!

  • http://www.delishibusiness.com Arwen Taylor

    I honestly think that the problem is that they are focused on the wrong thing. It’s not how the information is being sold. It is the type of information being sold.

    They are still stuck in the mindset of trying to sell “news” when the “news” is readily available at other free sources. They need to find another type of information product to sell. Either that or work on developing news personalities that people are willing to pay to read.

    Rachel Maddow talked about this last part during an interview on a late night talk show. I don’t remember which one. She basically said that people can get the facts and information from anywhere. What people want when they turn on your news station or read your newspaper column is your opinion about. They want to know your take.

    So I think they could get away with charging for content but they have to take a different approach and like any other business in a saturated market, find a way to repackage their product to make it attractive, again, to the buying public.

  • Adsense Publisher

    If more news publications go payola, it could create a black market for news.

    Let’s say it’s even $10 a month for a subscription.

    So one guy buys a subscription and then has an underground feed to thousands of others who are paying him just $1 a month each.

    Want the new feed address for this month? Just pay the $1 and you’ll get it emailed to you.

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  • http://www.matweller.com Mat Weller

    The way I read that survey, it says that 20% of the population IS willing to pay in some form or another. That has to be more of a population-share than most any periodical has currently.

  • http://surf-find.net Guest

    I find people won’t pay for news. Only News in Truth are worthy.

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