Monday, June 3, 2013

Morning Brief: Apple's iRadio said to be supported by advertising, though that remains a terribly weak area for the company; misdiagnosing newspapers

I, for one, look forward to an Apple Internet radio service supported by advertising – after all, Apple is so bad at the ad game that this should mean hours of ad-free music for listeners. According to The New York Times, Apple signed Warner Music Group over the weekend and is still in talks with Sony.

But Apple has at this ad game for three years now and remains in the wilderness as far as ad agencies and their clients go. Apple has had a near monopoly on interactive magazines for two years but has still not built out a service for publishers that have them dreaming of new revenue – or any at all, really, from advertising.

The problem is that Apple is the old Kremlin, trying to use central planning to dictate rates and creative to clients that simply won't play ball. Apple may have the audience, but it has failed to organize that audience into anything that resembles a real market.

"iAd is easy to implement, and hundreds of developers are making more than $15,000 per quarter," Apple brags embarrassingly on its website, failing to realize that this amount wouldn't even buy a quarter page ad in most major consumer magazines.

While the music industry may eventually sign up for Apple's Pandora ripoff, many small, independent record labels shutter at what is happening to the music business. The promise of the Internet, with its ability to reach a worldwide audience, has proved a disappointment.

I really wish I could recommend this Forbes article on newspapers based on its merits, but instead I guess I recommend it based in on its inability to see the real issues behind the decline of newspapers. Micheline Maynard talks about outsourcing at newspapers as if the practice has had anything to do with falling readership and revenue occurring in the industry.

Staff cutbacks, outsourcing and printing partnerships are a result of the changes occurring, not their cause. The Sun-Times laid off its entire photo department for ideological reasons, though they made a sad effort to portray this as the reason, but simply to cut costs and further break its unions.

The issue for newspapers is simply that they no longer serve the purpose they once did. Few of us wait for the paper to be delivered to find out what is happening in the world. By six in the morning I've already been updated, and while much of the sources I read are, in fact, newspaper companies, those papers are simply mixed in with the many other sources of information available.

Newspapers continue to believe in the one product rule. Those newspapers that have tried new product launches have quickly their efforts – so foreign is the act of launching new products that at the first sign of failure they fold up. Take the NYT: it launched its first tablet edition the day the iPad was launched. How many iPad apps do you think they currently have inside the Apple App Store? (Two, and only the one main NYT app inside the Newsstand).

All the publishing innovation one sees at newspapers are concentrated in the newsroom, as if all the other parts of the business mean nothing. Papers can redesign their websites all they want, they can build their newsroom caf├ęs, and play with HTML5 – but until they start getting their share of ad dollars again they are dead meat.