The Great Tablet Hope: Can the iPad Save the News Business?

There seems little doubt that the advent of tablets, the ultimate media consumption device, had a positive impact on the news business. But until the Pew Research Center's Project for Excellence in Journalism, in collaboration with The Economist Group, released a study in October, the exact impact was mere speculation.

While people enjoy consuming the news on tablets and tend to read more overall, the report found that this won't necessarily translate into big revenue opportunities-and that has to be disappointing for publishers hungry for new ways to package the news.

According to Pew, tablet users remain a small percentage of overall computer users, but these folks are avid news consumers. Pew found that a modest 11% of the public owns tablets, but more than half (53%) get their news on the device on a daily basis. Although they aren't just consuming news, tablet users report using their devices an average of 1 hour and 35 minutes a day.

In fact, the survey found that the only content users checked more on their tablets than news was email, coming in just 1% higher at 54%. Tablet users tended to be more avid news readers and were more likely to read longer articles than nontablet users were. In good news for publishers, a third of tablet users reported finding new publications through their tablets. Those who did download apps overwhelmingly (84%) reported that the news organization was a major factor in determining which apps to download.

Fifty-nine percent of those reporting said they used to get their news from a print newspaper. In a somewhat surprising finding, however, a majority of people reported that the tablet news experience was the same as print for them. Around a third reported that it was better, and a few reported that it was actually worse.

One finding that also surprised me was that respondents reported using the browser twice as much as apps to consume news, especially since so many news organizations have packaged their news into an app format for easy consumption. News organizations are clearly relying on apps to bring users into their content networks, where they hope to have some of the exclusive attention they used to enjoy when people sat down to read the paper.

Regardless of their overall perception, the big question is this: If users seem to enjoy the tablet experience, will that translate into paying subscribers? Unfortunately, that wasn't what people were telling the pollsters. Only 16% believed the news was "worth more" on the tablet, and only 14% reported paying for content. A mere 10% of readers said they would be willing to spend $10 a month.

It's always been my feeling that Pew results are on the conservative side. For example, 11% seems low to me for the overall number of tablet users when you consider that tens of millions of these devices have been sold to date. If the overall picture is accurate, it has to be disheartening to publishers. As the publishing world shifts and changes, publishers are hoping to discover new ways of generating revenue. It's clear that the one they operated on for most of the 20th century is no longer working. Competition for ad dollars has shifted much of the spending online, taking away a good portion of the income that newspapers once relied on.

Shifting demographics are also changing the newspaper business as young people ignore newsprint altogether. In fact, a recent survey from Cisco Systems, Inc. of 1,400 college students and 1,400 young professionals found that only 4% across both groups said the newspaper was their most important source for finding information.

That's because these young people are mobile and social, and they are connected constantly. This generation is far more likely to use a tablet or a smartphone to get its news, and that's clearly where publications need to be if they hope to capture a new generation of readers. The quandary, however, is how to make money doing this. Perhaps it will require newspapers and TV stations to form partnerships to deliver a variety of quality content in a single app or website experience.

Maybe this could be a value that even the 20-somethings would pay for. Whatever the formula may be-and publications are still hard at work trying to figure that out-tablets represent a news consumption opportunity. The question remains how to exploit that into a sustainable money-making business model.