The Steve Jobs Plan to Save Old Media
Apple faces the challenge of getting customers to pay for some content that is already free, an issue newspapers and broadcast TV are already dealing with as they try to come up with new, profitable business models. The New York Times plans to charge for its online news product in 2011, but it had a paid online content model until 2007 and discontinued it because if was not successful. Now some newspapers and magazines are considering "pay walls" and seeking alternative distribution through devices like the Amazon (AMZN) Kindle.
The challenge to Jobs may be straightforward, but that does not mean it is easy. In August of last year, the NPD research group said the iTunes store sold a quarter of all songs sold in the U.S., including both digital and physical copies. To compliment this, Apple had sold almost 225 million iPods as of the end of its September 2009 quarter. If Apple wants to become one of the core distributors of old print media and TV, it will probably have to create a business just as successful as the iPod and iTunes.
Publishers and TV firms are desperate for a means to gather new revenue in the digital age. Newspapers have found that simply offering internet products that get revenue from online advertising in not enough to stanch the bleeding of print sales. Jobs, who is viewed as one of the most important figures of the digital age, may help save The New York Times. Or he may just give the newspaper hope for a future on which he cannot deliver.