The Daily has proven to popular enough to generate at least 800,000 downloads to date, but that doesn't mean that it still isn't costing News Corp. a serious amount of cash.
According to its first quarterly earnings report of the year, News Corp. lost $10 million because of The Daily. That's on top of already $30 million in development and spending costs before the digital publication was even announced in February.
Despite that being a huge chunk of change to lose, News Corp. execs are still optimistic. News Corp. deputy chairman, president and chief Chase Carey asserted during the earnings conference call:
It's real early days at The Daily, work in progress. It's only a month plus that it's been pay based. It actually is one of the most downloaded news apps out there.
But it is a work in progress. I think -- we know that we're improving the technology, we're finding the content and the tablet market is still in its infancy if you look at any of the numbers. The tablet universe today versus the numbers people have out there for the end of this calendar year or the end of the following calendar year is a small fraction of what that will be. So I think on all fronts whether it's on The Daily itself or the tablet market and how it evolves, I think it's pretty early days on all those fronts.
It's fair enough to claim that a lot of that $10 million can be attributed to one-time startup costs, and The Daily didn't debut until after a month into the first quarter. Even though Carey boasted that the The Daily is one of the "most downloaded news apps," we didn't get any specifics nor numbers about readers converted from free trial downloads to paid subscribers.
Additionally, being that this is an iPad-only publication and that the iPad is definitely not in its infancy anymore (the iOS tablets are selling by millions per quarter), it's hard to argue that there isn't enough of an audience on the platform itself. It's more likely that most iPad owners are more willing to pay for a publication with more name brand recognition (i.e. The New York Times) or that they aren't familiar with The Daily at all yet.
Given how new and unique The Daily is, we should expect losses for the next few quarters. However, after browsing through the news app myself, it is an information-rich publication with plenty of interactive graphics and videos that most other existing newspapers and magazines severely lack on the digital side. Hopefully it doesn't end up as the sacrificial news app that paved the way for other digital-only publications.