Publishing's new digital divide
Tablet computers are set to explode in sales growth, reaching nearly 60 million units by 2015, according to projections by Forrester analyst, Sarah Rotman Epps (writes Cecilia Kang, in the Washington Post, 17 June).
And while that spells new business opportunities for media companies seeking to make money selling their content online, there are also obstacles in the way, Epps and publishers said during The Big Money’s Untethered 2010 conference Thursday in New York.
Smaller publishers are struggling to keep up with new platforms and devices, and there is a shortage of radio airwaves to meet the future needs of wireless tablet users. Questions over copyright and closed systems such as the iTunes store pose challenges and have changed the relationship publishers have with their customers.
Epps said tablets such as Apple’s iPad won’t replace the PC. Most Internet users will have more than one computing device in the home. But by 2012, she said, the number of tablet sales will exceed those of dedicated e-readers and will surpass sales of netbooks by 2014.
Her advice to media companies: Experiment on different platforms early.
“So for publishers, you don’t need to be perfect, but there are some advantages to being an early mover,” Epps said. “It allows you to test different price points and gives you an edge with advertisers. It also makes you a forward-looking company.”
The leaders of digital strategies at media giants such as Gannett, Conde Nast and The Washington Post, said the challenge is to keep up with fast changes while investing in the right places.
“We are struggling to stay on top of this as more and more fragmentation is occurring,” said Matt Jones, vice president of mobile strategy and operations at Gannett Digital.
He said his company is focusing on the iPad, but small- and medium-sized media firms may not have such resources. One official from the Newspaper Association of America said those newspaper outlets are constrained by budgets and are focusing more on improving their Web sites so that readers can reach them through mobile Web browsers as opposed to new applications that take them directly to the site.
“The customer expectations are way way up here because of companies like Apple and BlackBerry,” Jones said. “We have to have products that delight the customers, that are flawless and easy to use.”
NPR President Vivienne Schiller said that with iPad and iPhone applications the public radio company can compete with other media organizations such as the Associated Press and New York Times.
Schiller said there have been 350,000 downloads for NPR’s iPad application. But it is difficult for listeners to donate money through the Apple store, she said. And with no plans to charge for their iPhone, iPad and other apps in the future, the nonprofit trying to maintain individual donations – of more than $300 million – each year.
“That is a significant part of the business model for radio,” Schiller said. “We must figure out a way to keep that kind of relationship."
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