Can a steeply discounted tablet save your local newspaper?

Philadelphia Media Network is gambling that getting tablet computers into the hands of readers will be a path to salvation.
Written by David Chernicoff, Contributor

On Tuesday September 13, the Philadelphia Media Network, which owns two struggling big city newspapers, The Philadelphia Inquirer and Daily News, and the website Philly.com, will be making a big bet that getting tablet computers into the hands of readers will be a path to salvation.

The print newspapers, already struggling with readership and ad revenue despite being the only daily newspapers in the fifth largest city in the United States (almost 6 million people in the metropolitan area), have decided that there might be salvation in the tablet world. To experiment with that premise, they are releasing 5,000 tablets to be sold at $99 with a 2-year, $10/month subscription to the paper's digital versions, or $129 with a 1-year, $13/month subscription to the digital paper apps, originally developed for the Apple iPad.

The publisher of the Inquirer and the CEO of PMN,  Gregory J. Osberg, was quoted in AdWeek as saying that the manufacturer of the tablet hardware , Archos, had agreed "to let the papers keep the subscription revenue and consumer data, which will enable it to study user-ship."  In addition to the app subscriptions, some of the tablet costs are being offset by sponsorship from Comcast, Main Line Health, and Wells Fargo bank. PMN also said that separate subscriptions to the newspaper app, presumably for Android devices, will be available for $45/year.

As the frenzy over the HP Touchpad has shown, that $100 price point is certainly no bar to entry for people interested in tablets, and while the 10-inch  tablet is being based on newly announced hardware from Archos -- the Arnova 10 G2 tablet -- the hardware isn't exactly cutting edge. The screen resolution is only 1024 x 600, far below the 10-inch Android tablet standard set by the Motorola Xoom at 1280 x 1024 and even lacking the standardized aspect ratio of devices such as the iPad and Touchpad at 1024x768. There is no GPS, and no HDMI support, and only 4 GB of memory, though there is a micro SD slot.

The CPU is a single-core Rockchip 2918 at 1 GHz with an integrated GPU. Benchmarking tests done at the Arctablet Blog show reasonable performance.

Archos tablets have, in the past, not included the Google Android marketplace, using their own market and the third-party AppLib market, but the  "hands-on" review the newspaper did on their own product indicates the availability of more than 100,000 apps, which is more than the third-party markets offer so it is possible the device will have the standard Android market. On the plus side, the tablet does run Gingerbread (Android 2.3.1), which means that application support is good and they aren't struggling to support Honeycomb. And if they aren't using the Android Marketplace, Archos users, in the past,  have found ways to simply install it alongside the provided app source.

At $100, the tablet is a throwaway price for many people, though with the additional cost of the subscription to the newspaper apps, buyers might feel a bit locked in, and committing to trailing edge hardware for a multi-year subscription may not be the best experience that a user wants to buy into.

If you are already a subscriber to the papers or were looking for a reason to switch to their digital editions, perhaps the discounted cost of the apps will offset the cost of the hardware for you. I'm sure that's the intent of PMN.  But as a mechanism for drawing in new readers and expanding their revenue base, this seems doomed from the start, even as a transitional attempt to move into digital media.

If PMN's research finds that these tablets are of value to their business model, after the first 5,000 are in the hands of consumers, they plan a more general release of the devices on Black Friday. But with a less than financially secure traditional media company looking for ways to remain relevant, there's a good chance that those first 5,000 customers will be quickly orphaned.

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