The Daily has seen 800,000 downloads; still losing money

The Daily has seen 800,000 downloads; still losing money

Summary: 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.

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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.

Topics: iPad, Hardware, iOS, Mobile OS, Tablets

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5 comments
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  • Way too soon

    It took <i>USA Today</i> fifteen years to turn a profit.<ul><i>we should expect losses for the next few quarters.</i></ul>How about the next several years? I doubt Murdoch intends to throw in the towel and return to dead-tree publishing if this thing doesn't work instantly.
    Robert Hahn
  • RE: The Daily has seen 800,000 downloads; still losing money

    Why buy this? News is free all over the internet.

    Seriously, 800,000 iPad users are pretty stupid.
    Droid101
    • Not always

      <ul><i>Why buy this? News is free all over the internet.</i></ul>People viewing the action from 30,000 feet are noticing that the "free news" is being produced by companies that are going slowly out of business. If they keep doing what they're doing, the "free news" will disappear. After all, somebody has to pay people to collect the information, attend the press briefings, and write it all up.

      As a consumer, you might not worry about this. But the people behind The Daily (and The New York Times, and CBS News, and Gannett, etc.) worry about it a lot, because they are ones laying people off, closing bureaus, and going slowly out of business.

      So they need to run experiments like The Daily, to see what works and what doesn't in an online world. One of the things you're sure to see shortly is "paywalls" sprouting up around all the 'free' news. The alternative is for these firms to close their doors and lay everyone off. They'll try other things first.
      Robert Hahn
    • RE: The Daily has seen 800,000 downloads; still losing money

      @Droid101 I don't have an iPad, but I've used The Daily on a friend's iPad before. I'd pay money for something put together as well as The Daily. True, you can get plenty of articles for free online, but it requires some digging to get to the news you want and its often not formatted in as nice of a way.

      Lots of news companies are trying to find a way to make money to continue providing news. Its important that they find a way to do so, or else we will lose many great sources of news.
      vel0city
  • RE: The Daily has seen 800,000 downloads; still losing money

    Is it the traditional biased garbage Murdoch is known for? Well, at least we know there are 800,000 chumps out there.
    yodatech