

Why 'The Daily' Failed - MaxGabriel
http://daringfireball.net/2012/12/why_the_daily_failed

======
sedev
This is interesting to me in that it's a very Clay Shirky response to The
Daily's failure. If you read [http://www.shirky.com/weblog/2009/03/newspapers-
and-thinking...](http://www.shirky.com/weblog/2009/03/newspapers-and-thinking-
the-unthinkable/) or [http://www.shirky.com/weblog/2010/04/the-collapse-of-
complex...](http://www.shirky.com/weblog/2010/04/the-collapse-of-complex-
business-models/) they seem (at least in hindsight!) to say that things like
The Daily, that just stuff a newspaper into electronic form with the least
effort possible, are doomed because they haven't changed their cost centers
(for bonus points, the latter piece mocks Murdoch, the owner of The Daily, in
particular).

I can add very little to Shirky's critique, so I will just recommend that
people go and read his pieces and compare their predictions to what actually
happened to The Daily.

------
shmerl
_> But what’s foolish about publishing on a single platform? ... I publish
only on the web_

Is he pretending not to understand, or he really doesn't know? Publishing on
the web doesn't limit users, since web is an open and accessible platform
(given that you have any decent browser). Publishing "to iPad" is artificially
limiting your audience, because publishers weren't smart enough to use cross
platform publishing technologies (PDF anyone?).

So no - one platform publishing is plain stupid in this day and age. And no -
the Web is not called one platform publishing either.

~~~
jomohke
I think calling it 'stupid' is a little strong. There are hundreds of millions
of iOS users, and many newspapers exist serving cities with smaller
populations than that.

iOS is also a very different environment with regards to payment:

\- On iOS the process of purchasing paid and free apps is the same: you type
in your password.

\- On the web the process of purchasing paid applications has built-in
friction: 'free' is the default, and payment requires the user to trust the
store, input card information etc.

There are more people on the web, but web users are less willing to pay for
things.

I don't deny that a larger audience is better, but it adds overhead to support
more platforms, so focusing on one can be an advantage. Marco, the creator of
The Magazine (<http://the-magazine.org>), mentioned that he hasn't ruled out
other platforms, but with limited resources it's easier to focus on iOS for
now (he's the sole developer). Apparently after four issues he already has
enough income to pay market rates per-word to writers and hire an editor.

~~~
shmerl
_> I don't deny that a larger audience may be better, but it adds overhead to
support more platforms, so focusing on just one can be an advantage_

Publishers should however consider approaching their readers with respect.
Limiting access to content with platform is not pleasant for those who don't
use that platform. In case of physical books / magazines there is no such
limitation. So spending some more resources to avoid offending potential
readers is a worthy goal. Plus as I said that overhead doesn't sound to be
that dramatic - what's so difficult in providing a link to a PDF?

------
sami36
5 million / per year should (conservatively) pay for a staff of ~50. 30 in the
newsroom, 10 in software/design, 5 sales, 5 mgmt).

if they couldn't make a 100,000 iPad publication work for this kind of budget,
they're bloated & should go out of business.

The failure of The Daily is not a statement on Apple's 30 % cut, iPad vs web
publishing. It's a damning commentary on yesteryear's Journalism still not
getting it.

~~~
natrius
That isn't a conservative estimate. I worked for a news organization with a
staff of about 30. Our budget was around $4.5 million, and we were pretty
light on the (expensive) software side. That's also not accounting for profit,
which is typically why people do these things.

~~~
panabee
Interesting, would you mind breaking down the costs a bit more (e.g., fixed
costs, cost per journalist, how many journalists vs support staff like IT
personnel)?

~~~
natrius
I don't remember specifics, but there were about 20 journalists, 5 tech folks
and 5 business/fundraising people.

~~~
sami36
Thanks, care to share a lil bit more with us .Was that a dead-tree printed
publication ? Were you generalists or catering to a niche ?

~~~
natrius
It was The Texas Tribune, a non-profit, online news organization that covers
Texas state politics.

<http://www.texastribune.org>

------
kevinconroy
TL;DR Version: [The Daily's] success was that they got over 100,000 readers to
pay at least $40 per year for a subscription. How many digital publications
can say that? Not many. And the iPad — with Apple’s simple, trusted, familiar
payment mechanism — made that possible. The Daily’s problem was simply that
they weren’t conceived to operate on $5 or $6 million per year in revenue. A
smarter, smaller team could.

~~~
htf
Even shorter TL;DR: Some news article claimed that launching a magazine only
for Apple's iPad is not a good idea. Gruber comes to Apple's rescue and
explains how it's The Daily's own fault if they failed.

~~~
sbuk
But it _is_ The Daily's fault. Care to explain why it's Apple or their
platform's fault? I ask because the article that Gruber linked to sure as hell
didn't, and I suspect that you are merely perpetuating lazy internet memes.

~~~
Atropos
I'm not a programmer so maybe I'm way off, but I don't really see how -in the
context of newspapers- the right to sell a native app on the appstore can be
worth 30%, while a HTML5 version would be "free". And I also can't see how
only targeting Ipad could be better in this context than targeting all
tablets.

Because the population of people buying a yearly subscription to a newspaper
is quite special to begin with - if you are counting on the increased
publicity by being in the app store to sell subscriptions, I think you are
doing something wrong.

Of course The Daily probably made mistakes as well. But I'm very sure that the
succesful models of the future will neither be Ipad only nor giving up 30% to
Apple without adding much value to the customer in doing so...

~~~
rahoulb
The key thing is the App Store makes it a single click to pay that
subscription.

I know I only tried out the Magazine because it was so simple to subscribe -
and just as importantly, I knew how easy it would be to cancel if I didn't
like it.

I never read the Daily, but apart from the Magazine, all the Newsstand apps
I've tried have been utter crap.

~~~
Atropos
Well it depends what their target market was. If you are going for
"traditional newspaper readers", betting that tablets will replace paper over
the long term, then I can't imagine stuff like "single click" to matter. I for
one don't think that anyone having a physical newspaper subscription right now
would change to a different newspaper because of this...

Of course that demographic is going to disappear and all huge newspapers have
financial problems at the moment. But for example the NewYork Times web
subscription has >500.000 paying subscribers... I don't know, paying 30% to
apple for a better payment gateway seems just excessive to me.

~~~
Surio
>> I don't know, paying 30% to apple for a better payment gateway seems just
excessive to me.

From a purely economical perspective, this is a very good point....

------
JasonFruit
For all his faults, John Gruber is perceptive and an incisive writer. I tried
to dismiss it as his unwillingness to blame Apple's hardware or ecosystem, but
I have to admit it — Gruber's right that tablet-only delivery wasn't the
problem with The Daily. His assertion that an ill-defined audience and
unnecessarily broad scope killed it is probably mostly on-target, too.

~~~
jsnk
Gruber is perceptive and incisive, but post hoc analyses are dime a dozen.
Show me a writer who predicts successes and failures of start ups and ventures
at even 60% rate with explanation of why they will, and I'll be at awe.

~~~
JoshuaDavid
Prepare to be awed:

> An impressive series of studies by Thomas Åstebro sheds light on what
> happens when optimists receive bad news. He drew his data from a Canadian
> organization—the Inventor’s Assistance Program—which collects a small fee to
> provide inventors with an objective assessment of the commercial prospects
> of their idea. The evaluations rely on careful ratings of each invention on
> 37 criteria, including need for the product, cost of production, and
> estimated trend of demand. The analysts summarize their ratings by a letter
> grade, where D and E predict failure—a prediction made for over 70% of the
> inventions they review. The forecasts of failure are remarkably accurate:
> only 5 of 411 projects that were given the lowest grade reached
> commercialization, and none was successful.

\- Kahneman, Thinking Fast and Slow

The full data table is available here: <http://www.fptt-
pftt.gc.ca/pdf/Astebro_Gerchak.pdf> (page 36)

~~~
natrius
Predicting failure is easy. Predicting success is hard. Your quote is only
about the easy part.

~~~
JoshuaDavid
They also get 55% on success for A-rated companies, which is also pretty good.
It's not quite 60%, but it's very close, and considering how much above 60%
they get on predicting failures, I think that shows a fairly high accuracy of
prediction.

~~~
jopt
55% is just as close to 50% (coin toss) as 60%.

~~~
overcyn
Far far less than half of companies succeed. So identifying successful
companies by random draw is not equivalent to a coin toss. In the case of this
study, its 10%.

------
tnuc
>The Daily’s failure had nothing to do with it being iPad-only and everything
to do with the fact that it just plain stunk.

iPad only?

<http://learn.thedaily.com/android/>

<http://learn.thedaily.com/kindle-fire/>

<http://learn.thedaily.com/iphone/>

~~~
dangrossman
Technically not iPad-only, but if you didn't have an iPad you probably
couldn't subscribe. The iPhone version is only available if you own an iPad as
well. The Android version is only available on two tablets -- the Kindle Fire
and one Samsung tablet... and only if you bought that Samsung tablet from
Verizon.

~~~
nglevin
I regret to admit to knowing this, but that's not correct. The subscription
tiers were more like;

\- iPhone + Android phone sub

\- iPad AND iPhone + Android phone sub

Android phone is equivalent to Kindle Fire. I have no idea why the Kindle was
promoted over the Android phone, but it wasn't originally conceived as an
exclusive.

Even to this day, I have no idea how the Android tablet subscriptions were
handled. It was a Verizon exclusive, it was preloaded for exactly one tablet
and it couldn't be uninstalled. I don't even know how many tablets were sold
like this, but I don't believe it was many.

The Daily for Android tablet did an impressive job of replicating some parts
of UIKit for Android. Shame nobody saw it.

------
rdl
I find The Economist's online edition to be technically good, and of course
the content from that "newspaper" is great as well.

If you went no farther than The Economist's software, with $1mm/yr of writing
focusing (as Gruber suggests) on opinion, news, and analysis, I'd be willing
to pay $20-30/yr.

I would prefer something like Foreign Affairs, although slightly more timely
(weekly or biweekly, vs bimonthly).

------
elteto
Half a million dollars per week? What were they doing? Running their backend
on gold-plated servers? No, seriously, how can you run so high with a digital
distribution model? You are not even _printing_ the stuff!!!

~~~
MatthewPhillips
Probably stuff like sending people to Florida to cover a campaign, sending
people to Cupertino to cover the iPad mini, sending people to Geneva to cover
the Higgs discovery played more into the expense.

~~~
antidoh
Did they do their own reporting or just use Newscorp content?

------
iuguy
For a decent counterpoint, see here[1]. Ignore the pro-murdoch spiel in there,
much as you'd hopefully ignore the apple sycopanthy from Gruber.

Personally I don't see the Daily as a failure. Of all the newspapers I see
online in the UK, the only ones making money from it are the Times (with it's
paywall) and so on. The Daily was a good experiment but ultimately would've
suffered more from limited market sizes (why not web? why not android? why not
every platform and a html5 backend?), but fundamentally I suspect what killed
the daily off (at least for the UK) was the Times iPad edition. With it,
Murdoch has a dead tree and online version and is making money from both.
Thus, the need for the Daily (still running at a loss) to exist is gone, but
you can bet that the Times iPad was definitely influenced by the Daily.

[1] - [http://www.kernelmag.com/yiannopoulos/3703/thank-god-for-
mur...](http://www.kernelmag.com/yiannopoulos/3703/thank-god-for-murdoch/)

------
dgregd
Maybe we should redefine what newspapers and journalists should do in Internet
era.

Reporters from traditional magazines talk to interesting people, write
articles and newspapers print them (of course I simplified things a bit).

But today I can directly connect to Elon Musk and Bill Gates twitter feed. I
don't need any middleman to read blogs written by experts. How reporters can
add value, do we really need them?

Yesterday I've got email from Vint Cerf about free and open web. The question
is why this action isn't initiated by journalists?

~~~
gurkendoktor
You only talk about positive celebrity news. In contrast, I think the most
interesting newspaper stories are the ones that influential people do _not_
want you to know about. I can follow my government's twitter account, but will
they talk about how they are tweaking statistics to their advantage etc.?

~~~
tomjen3
Properly not, but then so wouldn't most newspapers, most of the time.

That kind of reporting is expensive, both directly and indirectly (in terms of
goodwill and access to politicians). Newspapers are burning too much money now
that they no longer have a monopoly on news (and, more importantly, ads) so
they have to cut costs -- and the easiest thing to cut is the kind of
expensive reporting that we really need them for.

I am almost always downvoted when I say so, but the NYT is _not_ a good paper
anymore, it has become a rag -- it may still only print what is fit to print,
but it has long ago stopped printing exactly the kind of news they should be
printing -- and which I would have been willing to pay for.

------
tnuc
As much as I disagree with some of Rupert Murdoch's politics;

Good on him for trying something new and failing. He is trying to sell his
product and it failed.

And not only did it fail but he was straight enough to give us an idea of the
costs and pitfalls involved in trying to run something like this. I wish
others were as straight up with outlining their failures so we can all learn
from them.

~~~
lostlogin
He is not straight up in acknowledging failure. He is just quick to cut and
run. Did you see any of the footage of him being interviewed about the phone
hacking scandal? He is a mercenary liar and a cut throat businessman. There is
little to admire in the way Murdoch behaves - ask Milly Dowler's family.

------
antidoh
"that just stuff a newspaper into electronic form with the least effort
possible, are doomed"

Oh, you've read the Denver Post. <http://www.denverpost.com/>

"A Media News Group web site."
<http://www.medianewsgroup.com/Pages/default.aspx>

------
jccalhoun
It isn't really an either/or. Yes The Daily's operating expenses were way too
high but being limited to the ipad and a couple other devices didn't help
things.

------
jasonwatkinspdx
_"Correlation is not causation"_

Considering that no one presented statistical evidence of any form, I don't
know what you're talking about John.

~~~
jopt
If you really don't follow, he probably refers to the con hoc ergo propter hoc
argument of "this means tablet-native journalism is impossible!" What else
could it be?

I get the feeling you're trying to be smug about something, but I don't really
see what.

~~~
jasonwatkinspdx
I'm not feeling smug, I'm feeling tired of people using statistical concepts
outside the context of statistical evidence.

I don't see anyone making an argument as extreme as saying that tablet native
journalism is impossible. I do think people are suggesting that narrowing
their market may have been a key factor in exhausting their runway, and I
think that's a reasonable question to ask.

But no one is presenting any statistical evidence either way, so a concept
like correlation plays no part. We can quote cute maxims all day in order to
try to sound smart, but if they aren't applicable to the discussion, what's
the point other than as theater: an attempt at rhetorical persuasion by
performing familiarity with irrelevant concepts.

As a separate topic, if you'll indulge my own theater:

The phrase "correlation is not causation" is broadly misunderstood as being a
stronger criticism than it is. My way of summarizing this is that "correlation
is not causation, but causation causes correlation." For a fully rigorous and
enjoyable treatment of how causal concepts relate to statistical evidence I
recommend Judea Pearl's book Causality, which elaborates the concepts for
which he won the Turing prize. If you don't have time for the book, the epilog
is up on the web a few different places and is a great summary.

~~~
MaysonL
_I don't see anyone making an argument as extreme as saying that tablet native
journalism is impossible._

Read the headline of the Felix Salmon blog post which Gruber was criticizing:
"The impossibility of tablet-native journalism"

[http://blogs.reuters.com/felix-salmon/2012/12/03/the-
impossi...](http://blogs.reuters.com/felix-salmon/2012/12/03/the-
impossibility-of-tablet-native-journalism/)

~~~
jasonwatkinspdx
Oh man, you're right. I never read the headline. How embarrassing.

