This may be the digital age, but for Rupert Murdoch’s News Corp, the bold experiment to create a tablet-only newspaper has largely failed, as evidenced by yesterday’s announcement that the The Daily will lay off 29% of its staff in an attempt to stay afloat.
The Daily, which was launched 19 months ago and cost News Corp $30 million to develop and $500,000 per week to produce, has struggled to find an audience willing to pay for news they generally can find for free on the Internet.
With subscriptions in the 100,000 range, The Daily is estimated to have lost $30 million in its first year in addition to the development costs, meaning News Corp has invested at least $60 million, with very little to show for its efforts.
News Corp tried to put its best face on the changes:
The changes announced today at The Daily will enable the business to operate more efficiently and with even greater focus on the types of content that consumers have gravitated towards since its launch. News Corporation remains committed to The Daily, and the publication will continue to be an important part of our leading portfolio of publishing brands going forward.
That may sound like a vote of confidence, but the problem is not only that The Daily is losing tons of money. With the impending split of News Corp’s publishing and entertainment business, The Daily will have to prove itself without the benefit of the profits of Fox News and other entertainment assets.
The Daily has shown that despite tablet users almost insatiable appetite for news apps, not enough of them were willing to pay for news that wasn’t much different from what they could receive for free via news apps from other papers, including News Corp’s own New York Post. Even though The Daily may be safe through election day, Murdoch should just admit to a colossal mistake and pull the plug before it loses any more money.