MONACO- James Murdoch believes in the digital platform, but in his keynote speech to the Monaco Media Forum today he expressed serious concern that “The problem with apps (even apps the public pays for) is that they are much more directly cannibalistic of the print products than the website. People interact with it much more like they do with the traditional product.” said the man who runs News Corps’ European and Asian Operations, and is Rupert Murdoch’s son.
OMG, you’re creating a product the public WANTS! Murdoch’s response reflects the difficulty established companies have transitioning to the new digital platforms. They still look at it as a threat to their traditional business models MORE than as an exciting new, more efficient, platform on which they can serve their customers.
Let’s not lose sight of an even more important observation: In this case the newspaper is losing it’s customer to itself and NOT to a digital competitor. In the long run, this is the answer, not the problem.
I understand the issue, these companies are depending on their existing revenues to carry them during their transition to new platforms. But it’s a suicide strategy to keep the old products propped up while cutting them to the bone as they lose revenue and customers. The fact is, if you don’t give customers your content on the platform they want it, they will find someone who will give it to them and the traditional players will be left in the dust.
The reason IPad Apps are cannibalistic is simple: They are great products, or at least some of them are. I love the NYPost app. They are giving consumers exactly what they want…a replicated news experience on a convenient platform. It’s a fun product AND I pay for it.
Make more of these, James, and charge a fair price. If you lose your newspaper subscribers to this, you still win big, because you still have them as customers, and they are fine.
Without the printing and distribution, the cost drops significantly, and the product is timelier. And, it doesn’t come off on your hands!