La Presse has made a $40-million bet on a new tablet platform that it hopes will replace its newspaper.
The newspaper industry is dying. The data is conclusive. As baby boomers die off, so will the business model of the daily newspaper, and there’s no way to stop it.
As someone who works for a daily newspaper, it’s tough to hear this. People in this industry want to pretend that there’s some magic solution waiting, but everyone has that fear that maybe the death spiral will continue until the business model collapses in on itself and there’s nothing left but some novelty papers kept for the sake of posterity.
But what really got me wasn’t what I was hearing, but who I was hearing it from: Guy Crevier, the publisher of La Presse, one of Canada’s largest and most prestigious newspapers.
And he wasn’t just repeating some attention-grabbing phrases he heard at the latest industry conference. Crevier’s conclusions are based on numbers and analysis that his company has spent millions to produce.
First impressions
Six months ago, La Presse launched La Presse+, a free iPad app that it said cost $40 million over three years. On the day it started, I wrote a blog post saying the plan didn’t make sense to me. How does creating an app you give away for free, and encouraging people to stop paid subscriptions to a newspaper, make business sense? It boggled my mind, and I wondered if this wasn’t evidence that senior managers at Gesca had gone mad with the seemingly endless cash flow of parent company Power Corporation.
Not long after that blog post, I had a meeting with one of those senior managers, who tried to explain the business model to me over lunch. I remained unconvinced, but started to see how someone smart could come to the conclusion that this might make sense.
After that, I met with Crevier. Over the course of an hour, he explained to me the logic behind the move, and his vision of the future of La Presse. It was certainly eye-opening.
The first thing I learned is that, of that $40 million, $2 million was spent on research. How should a tablet-based medium work? What software should they use? How often should it be updated? There wasn’t really an existing model to go on, so they had to do a lot of thinking based on numbers and experimentation.
During the three years before launch, “we were in research (mode) almost the whole time, except during the final two summers and Christmas holidays,” Crevier said.
The newspaper industry is dying, says La Presse publisher Guy Crevier
The cold, hard truth
“The printed paper is a phenomenon of baby boomers,” he said. “These people, like me, have adopted a mode of consumption that is consumption of a printed paper.”
This won’t come as news to too many people. But Crevier said that it’s not just an age thing. Younger people won’t grow into reading newspapers as they get older. The change in habits is permanent.
In 1998, he said, looking at a chart on a sheet of paper in front of him, there were 1.5 million adults 25-34 in Canada who said they will read a newspaper during a given week. In 2011, that had dropped to 699,000.
On another sheet, more figures: In 2006, the North American newspaper industry had revenues of $49 billion. In 2011, it was $23 billion. In five years, newspaper revenue dropped by half.
“Even auto companies, which are the main advertisers for newspapers, are planning to leave traditional advertising,” Crevier said.
“Just on this basis alone, you ask: ‘How can I continue? What’s the value of continuing?'”
But most newspaper publishers haven’t gotten to that point yet. So they do continue, trying to find ways to boost revenue or trim expenses and hoping that by going leaner and finding cheap ways to make money, they can save their newspapers.
Most have tried to increase revenue and avoid a drop in subscriptions by setting up paywalls.
“I don’t believe in paywalls,” Crevier said. “I think the New York Times will succeed. I think the Financial Times will succeed. I think probably one or two large European papers will succeed. Why? Because they have content that is really, really unique. Secondly they’ll succeed because they have content that is so specialized and so business-oriented. Take the Financial Times. Half of their paying readers probably put it on their expense accounts. The other papers who have paywalls, there hasn’t been much success yet. Nobody’s making a distinction (when reporting figures) between those who get it free (because they have a print subscription) and those who pay for online access.”
Crevier is right. Most publishers of paid newspapers have moved to paywall systems: The Globe and Mail, Postmedia, Sun Media, Le Devoir, and recently the Toronto Star have all implemented them. But there hasn’t been any strong evidence of their success. Much of the news they produce is also put online for free by competitors like CBC, local television and radio stations, and anywhere else that republishes The Canadian Press.
Crevier compared paywalls to cancer treatments that merely delay the inevitable.
There are other gimmicks being used to raise money, like selling ebooks or hosting conferences. But much of these are the equivalent of bailing water out of the Titanic with a tea cup.
“So what do you do? You start cutting,” Crevier said. “You cut in the quality of your content. When you cut content, you lose readership. You enter into this circle.”
Sure enough, that’s what almost everyone has done in the newspaper industry, and many other forms of traditional media as well. They’ve cut staff, which inevitably leads to negative effects on their content.
But not La Presse.
The magic tablet
It was January 2010, the same month Steve Jobs announced the first iPad. Crevier assembled a team in a conference room. “We told them to create a new medium. Keep the DNA of La Presse, but create a new medium that exploits the full potential.”
There are a lot of reasons basing this new medium on the tablet makes sense. Because along with all the sad statistics about the newspaper industry, Crevier had some equally surprising numbers about tablets, a medium that is less than five years old.
One of them is the time between when a product is developed and when it reaches 10 per cent audience penetration:
- Telephone: 25 years
- Television: 11 years
- Wireless telephony: 11 years
- Internet access: 9 years
- Smartphones: 7 years
- Tablets: 2.5 years
“Our profound understanding is that the tablet will become its own media, stronger than television, stronger than newspapers, stronger than magazines. Because it’s interactive, it’s mobile, it has exceptional reproduction, it has sound, video.”
And it’s growing. La Presse has 1.7 million readers over various platforms, and Crevier said 500,000 of them said they planned to buy a tablet within the next year.
“It’s phenomenal.”
But there were still a lot of things to work out. And much of the next three years would be spent doing just that.
In the meantime, while other media companies were announcing layoffs by the hundreds, La Presse was hiring. It increased its newsroom by about 100 people, including journalists, columnists, photographers, videographers and page designers, to about 350 people total, though some people hired have since been let go, and severe reductions in distribution staff meant the number of actual employees didn’t change much. La Presse redesigned its offices so the editorial and technology groups combined now take up three floors of the building at St-Jacques St. and St-Laurent Blvd.
Newly renovated offices in the La Presse building to accommodate all the extra staff
$40 million in context
Much ink has been spilled about La Presse spending $40 million constructing this app.
“People say $40 million, that’s a lot of money,” Crevier said, before trying to put it into context.
“How much do you think it would cost me tomorrow morning to replace La Presse’s printing presses? It would cost me between $150 million and $200 million. And when I build a plant to print La Presse, I’m limited to 250,000 to 300,000 (copies) maximum. What does this money bring in future obligations? It brings me expenses of $100 million a year in paper, ink, trucks.”
Shipping the paper to far out places like Lac Mégantic, Thetford Mines, Beauport, Chicoutimi and even Fort Lauderdale is “excessively expensive,” he said.
But if the iPad app replaces the newspaper, most of these expenses disappear. There’s no printing presses to run, no ink or paper to buy, no delivery people or shipping costs to pay. And doubling, tripling, or quadrupling the readership can be done easily. The size of the publication and its audience reach both become limitless.
“The only additional expense is bandwidth.”
Because of this, Crevier expects the startup costs to be made up in only a couple of years.
Besides research, and $24 million in salaries for all those people that were hired, another $8 million went into software. “We had to modify 20 pieces of software,” Crevier said, and create five of their own. The biggest issue was that, because they wanted to lay out individual pages, they couldn’t just copy the apps of other newspapers that just feed every story into a standard template.
“The only people who did layout on the iPad on a regular basis are people who do magazines, who don’t have the stress of (daily) deadlines,” he said.
That deadline pressure meant they needed a way to have multiple people working on a page at the same time. A reporter writing a story, and designers laying it out, for example. Crevier said it was a German company that finally created software that allowed this.
Why free?
Newspaper executives have argued that the biggest mistake they made collectively is giving away content for free online. It taught the younger generation that news should always be free online, and they failed to grow up to be accustomed to paying for it.
But the iPad world isn’t quite like that. Many popular apps are paid ones. And provided the cost is cheap enough, people don’t mind paying.
So why did La Presse’s app insist on not charging people?
“We could have launched a paid La Presse app,” Crevier said. “We might have gotten 30,000 subscribers, people who are very happy, very satisfied.”
But the real money isn’t in paid subscriptions, it’s in advertising. “What do I do with 30,000 subscribers?”
“Say it’s been three years that we’ve done this and we’ve reached 150,000 subscribers, and then Radio-Canada releases a free app and reaches 600,000 or 700,000 subscribers?”
So the decision was made to make the tablet free, and to make all the money off advertising.
It’s one of the principal ways La Presse+ plans to be different from The Daily, a similar tablet-only publication launched by News Corporation that lasted less than two years. The Daily was a paid app, and its national focus meant it had less relevant local news than La Presse does. The Daily failed because it couldn’t get an audience. La Presse expects not to have the same problem.
A half-page ad on La Presse+
A new kind of ad
Because it would be their main source of revenue, a lot of attention was paid to advertising in designing the iPad app. There were 1,400 ads presented to focus groups to determine which ones worked and which ones didn’t. Unsurprisingly, those with interactive components scored better in terms of recall.
Crevier used the example of a fake ad for Crest teeth whitening, involving a slider used to show before and after. After asking people to flip through an issue that had that ad in it, everyone could recall the ad afterward.
He also used an example of an ad for Adele, which features excerpts from her songs. Using equipment to track eye movement, the results showed a big red blob at the play button. People were looking at this ad and focused on it far more than they would be any newspaper ad.
The interactivity allowed by the new medium not only gives advertisers more tools to make their ads stand out, but they give tools to La Presse to see how the audience responds to them. Its app tracks how many people see and interact with an add, and for how long. Combined with demographic information, it can provide a lot of useful information to advertisers, and make advertising much more efficient and therefore lucrative for both parties.
Interactivity comes at a cost. Rates for interactive ads are higher than non-interactive ones, and those rates go up for each form of interaction. That resulted in some criticism that ad rates are too high.
Crevier dismissed that criticism, noting that it came before the app was even launched by someone who never used it.
“We’re not more expensive than other media,” Crevier said. And in any case, it’s not the price that’s important per se, it’s the ability to show that the price is worth it. And in his opinion, the higher impact of the interactive tablet ads are worth the extra cost.
Crevier has said the price of a full-page ad in the app is about $16,000. The idea is to make it equivalent to a full-page ad in the paper.
The rate charged for advertising is of critical importance in the business model for electronic media. Rates for banner ads on websites are dirt-cheap because of the immense supply and because of how much they’re ignored by users, even those without ad blocking software. As a result, the ads have become more intrusive, many playing video unprompted, others taking over the entire screen to grab the reader’s attention.
For Crevier, the iPad is different. It’s more like a newspaper that people flip through than a website that people click on. And data show that people spend 35 minutes flipping (or swiping) through the app on average during weekdays, and 70 minutes on weekends. The hope is that because of that, the ads will be able to draw more newspaper-like rates.
Whether that’s true, we’ll have to see. A lot of early advertisers got special deals, and because La Presse doesn’t report financial results publicly, we won’t know unless they tell us whether they’re getting what they hoped in ad revenue.
La Presse has an ad creation kit online for the app, in case you want to see all the various interactivity options available.
Why iPad-only?
One of the criticisms of La Presse+ is that it forces people to buy an iPad to access it. There’s no La Presse+ experience online, nor is the application available for any other tablet. This led some to question whether La Presse was in bed with Apple or had some secret exclusivity deal going on.
Well, they don’t, though La Presse worked closely with Apple in developing the app and they do have deals to encourage La Presse readers to buy iPads.
The reason why La Presse+ launched just for the iPad is once again about numbers. Nine out of 10 tablets are iPads. And the iPad is a closed system which makes it easier to develop for. Google’s Android is offered by multiple manufacturers, so even something as basic as screen size can vary from one device to the other, making programming more complicated. It became clear that developing for the iPad first made sense. But a version for Android is being developed. The plan was to have it ready by December.
So why not a web-based app? Because La Presse wants people on this new medium and its new, more expensive advertisements. It will continue to have a website with breaking news, but the app is now the “flagship” product, Crevier said. And this is why, while “screens” with stories can be shared through social media, things like videos are only available through the app.
I’m not sure I entirely understand this strategy. But it’s what they’ve decided. And, it should be noted, the Washington Post’s new owner, Jeff Bezos, feels the same way.
As for arguments that this is La Presse forcing people to get iPads, Crevier once again says to look at the numbers. “A subscription to La Presse costs $200 a year,” he said. “You can buy an iPad for $300. In one year, you’ve (mostly) financed the cost of the iPad, on which you can do plenty of other things.”
La Presse+ updates only once a day, at around 1:30am
Why only one edition a day?
Another major criticism against La Presse+ is its update schedule. Like a newspaper, it updates only once a day, overnight. That means that if major news breaks in the morning, you won’t see it on the La Presse+ front page until the next day. A major failure according to one analyst (who does some work for The Gazette’s parent Postmedia), that has prompted even some mockery by competitors.
This criticism is based on an apparent misunderstanding of how La Presse+ works. Its designed pages aren’t supposed to have up-to-the-minute breaking news. If that’s what you want, it has a tab called “en direct” that features breaking news from its website. (A similar tab in the sports section allows access to live sports scores.)
La Presse+’s “en direct” tab with breaking news
Crevier admits this tab isn’t as prominent as it should be, and he’s “not happy” with that. He hopes a future update will make it more obvious.
But unlike other news organizations’ apps, whose pages are automatically generated based on generic templates, redoing the carefully designed layouts of an edition of La Presse+ based on breaking news isn’t feasible, Crevier said.
“It takes 70 people to create a (complete) La Presse+ layout. Would I have a team at 8am to modify this edition in case something happens? Eight to 10 people to redo a page just in case?”
You’d think it wouldn’t be that difficult to have a generic template that could be used for breaking news, and that the existing staff that edits stories for LaPresse.ca could produce a page for La Presse+ that, even if it doesn’t look fantastic, would at least be there.
Though I guess that wouldn’t be much different than what you get already with the “en direct” tab.
A breaking news story from LaPresse.ca on the app
Other issues
Among other complaints about the app that have been brought up by critics:
- Download size: Reaching 100 MB for large issues. The application is insistent in its warning against downloading issues via mobile wireless.
- Orientation: It’s landscape-only. Having a version that allowed portrait layouts would have been too complicated.
- Usability: It’s not 100% intuitive how to scroll through articles, make things full-screen and navigate the app.
- Missing parts: The app has no classified ads, no obituaries. It only recently added functional crossword puzzles. Some things you expect from any newspaper aren’t yet present in this medium.
Thumbnails of pages in the La Presse+ app. They’re useful, if you know that you have to tap the bar at the top of the app to show them.
Multimedia focus
La Presse has built professional-looking television studios on the first floor of its building.
La Presse’s website had video as well as text, but video takes on a much greater presence in the La Presse+ app. So the company took the office space formerly used by La Presse Télé (now the independent LP8 Media) and created professional-looking studios. There’s a control room, similar to what you’d have in a TV station. There are audio recording suites. There’s even a makeup room:
How many newspapers have a makeup room?
Readership goals
“We expected to reach 200,000 users in September, and we’ll attain this in the next few days,” Crevier said proudly in May, as data showed that the app was getting more than 1,000 downloads each day.
Users, in this case, referred to the number of people who would use the app at least once a week, based on usage data and the assumption that each tablet has 1.5 readers. La Presse’s deal with Apple prohibits the paper from divulging how many downloads the app has received.
Nevertheless, in August, Crevier announced the application was installed on 250,000 tablets, and by the six-month anniversary last week that number was around 300,000. The next goal, of 400,000 readers by December, seems attainable, even if the growth rate has slowed.
The future of the paper
“The flagship of La Presse is La Presse+”
With all the talk of “digital first” strategies from people behind other newspapers, it was still odd to hear that from a publisher. Is La Presse, one of North America’s oldest newspapers, now a secondary medium to a just-launched iPad app?
Apparently so. “The intention today is to invest all our resources into our flagship product, which is La Presse+,” Crevier said.
And it’s not just $40 million that they’re betting on this app. It seems like they’re betting the future of La Presse itself. They’re practically encouraging readers to stop subscribing to the paper edition and pick up the iPad app instead.
That sounds crazy, not just because it means losing subscription revenue, but because the economies of scale in newspaper production means it needs as many customers as possible. La Presse doesn’t save 50% on its presses or delivery trucks if it has 50% fewer subscribers. And its huge fixed costs only go away when the paper shuts down for good.
Crevier said there’s no set timeline for making that move, though he does see it happening eventually.
“We’re not at that point yet. The more La Presse+ is a success, the more the acceleration toward the end of the paper. The consumer will decide. There’s no plan for shutting down the paper, other than the success (of La Presse+) will decide.”
I don’t know how long the paper will keep running. I think it’ll probably be longer than people think. And La Presse seems to be playing Russian Roulette here. If they win, La Presse becomes a leader in a new medium, well ahead of its competitors. If they lose, La Presse either becomes severely crippled by bad business decisions or goes under completely.
It’s a gamble I certainly wouldn’t have the balls to make.
I asked Crevier at the end of our interview whether he was worried.
“Sure there’s worry,” he said, laughing confidently. To me it seemed like the understatement of a lifetime.
More screenshots
The La Presse+ main menu
Album reviews on La Presse+ come with a cover image and song excerpt
Stocks pages on La Presse+
Intro page for a multi-article package
Related stories are grouped together with tabs at the top of the screen. Rather than swiping to get from one to the next, you have to tap the tab in question.
Columns come with prominent images of columnist headshots
Expanding an article switches it to full-page mode, which eliminates all the layout distractions and gives it a simple black on white layout for easy reading.
Some pages have a series of one-paragraph briefs
Some stories are presented in a gallery format, where you swipe between items
La Presse+ launched with a bunch of new celebrity contributing columnists, including Laurent Paquin
Further reading
Recent:
- Projet J talks to journalists Tristan Péloquin and Katia Gagnon about how their work has changed since La Presse+
- La Croix also talks to Guy Crevier
- France’s Meta-Media with some numbers, and some pros and cons
- Switzerland’s RTS radio visits La Presse, and chats with Crevier and some journalists in detail about the project
- Crevier spoke at the World Publishing Expo Tablet and App Summit in Berlin this month. Notes from the speech, and articles in journalism.co.uk and The Media Briefing
- More analysis (some based on this post) from Kevin Anderson, MediaType, the Observatoire des médias and Libération, plus those that left trackbacks below.
Earlier:
- Les Affaires’s François Pouliot talks to Crevier in April and discusses whether this plan will work
- My post from April about the La Presse+ launch and my skepticism about its business model, which links to reviews from Tab Times, Maxime Johnson, Talking New Media, Fabian Rodriguez, Adviso and Michelle Blanc
- L’Actualité, in June, about La Presse’s big gamble, and a Canadian Press story about the launch
- InfoPresse about the marketing efforts associated with the new platform
If you haven’t already downloaded it, and have an iPad (second generation or above), The La Presse+ app is here in the iTunes store.
UPDATE: Readership data from the NADbank survey shows print readership for La Presse down significantly for young readers.
UPDATE (Nov. 18): Another update from Projet J, saying the Android version of the app is now planned for April 2014.
UPDATE (June 16 2015): A long series from NetNewsCheck on La Presse+. The paper also recently redesigned its newsroom, moving it into the hall that used to house its presses.
It will probably be all gone by the end of the decade, and La Presse will be one of the first to go. They can’t even give it (print copy) away for free.
What do you base that assertion on? La Presse still has hundreds of thousands of print readers, so clearly lots of people are still interested in it.
Beta vs VHS all over again… and LP+ is Betamax.
From this past weekend:
Newspaper tablets apps were the future.
But the future still hasn’t arrived
http://www.independent.co.uk/voices/comment/newspaper-tablets-apps-were-the-future-but-the-future-still-hasnt-arrived-8892633.html
I sadly agree with you, especially when I read stuff like this coming from Crevier:
“Our profound understanding is that the tablet will become its own media”
It would make sense if La Presse didn’t insist on mimicking paper in its app; I’m not sure it’s an intentional design to reach out to older demographics or just a sort of lameness on their end. There’s so much graphic design going on, which is good, but once you scratch the surface it feels like a cheap 1990s CD-ROM presentation.
All in all, it’s a good start and I have no doubt the app will evolve, but we’re definitely not there yet.
The fact that they hand them out for free at various points in the subway – no takers.
The fact that there are bins of them free for the taking at Place Bonaventure – the bins are always full with no one touching them with a ten-foot pole.
The fact that for some reason, La Presse is an “exhibitor” at the annual SMAQ each December – I feel bad for the staffers there for they are always just twiddling their thumbs.
It’s very common to see the Journal de Montreal handing out free copies all over town — with about as many people refusing.
On their competitor website, we can learn that they are loosing a lot of their readers.
In the 25-34 age, -45% monday to friday and -55% weekends.
http://www.journaldemontreal.com/2013/10/22/encore-40-000-lecteurs-de-plus
To be clear, this is print readership. But that’s a clear drop in readership among younger readers, presumably in favour of the app.
Thanks! This is a great blog post … well researched, well laid out, and clear. You do amazing reporting on trends in local media.
La Presse saw the light, and they are moving towards it.
The keys here really are the costs of making a print edition. Not just the monetary costs directly to the company, but rather the costs to the enviroment both from the harvesting and processing of trees (or recycled material) into newsprint, delivery of the newsprint to the printer, and delivering the papers from the printer to the end users. The price of fuel for the trucks and energy to process the pulp into paper contiunes to go only one direction, UP. What costs them 100 million a year (example cited in article) will likely cost them double that a decade from now. There is only one way that elevator is going.
The other part here is the environmental issues. There is not only the pure tree huggers who don’t want trees cut down for paper that is essentially garbage 12 hours after use, but also the questions of recycling costs, of landfills, and of course the environmental and life issues of excessive transport of materials. There will come a day, sooner rather than later, that newspapers (and magazines for that matter) will be forced to deal with these issues. The start may be taxes or levies on the paper itself, possibly even to the level of a city like Montreal charging companies that rely on printed media a fee per ton used to offset the costs of recycling. All of that will hurt the bottom line.
Combine all of those negative issues with the issues of declining advertising rates and a declining number of advertisers in print media, and even the less than bright can see this whole thing crash landing. The demographics don’t lie here, with fewer and fewer people in the prime target markets picking up printed media, this elevator only goes one direction, down.
When the up elevator of costs runs into the down elevator of readership and income, the future becomes inevitable. Most major print media companies are still running with their heads firmly planted in the sand, paying lip service at best to the internet. To haul out a somewhat tired example, the print media guys are like the buggy makers of the late 1800s and early 1900s… if you didn’t figure out that the car was the future, your lifespan as a company was limited by technology. No amount of cost cutting will ever keep up with a technological change that has pretty much turned print media into the rotary dial wall phones of the day.
Until the print media people realize where they are, they will be doomed to fail. La Presse has at least spotted a potential way to avoid the ice age that will kill off most of the dinosaurs, they must evolve or become fossils of another day. The Gazette and other Postmedia properties appear not to be getting it yet, charges $10 a month for access to a website for news is pretty much self defeating, pushing people towards other (free) sources for news and information.
Print media isn’t at the crossroads, they are way past that already. Some took the turn and went the other way, others kept plowing forward and now are pretty much in a dark forest on a rutted track, heading pretty much directly into the abyss. Some may find a path through the trees and back to the reality the rest of us live in, but it’s more likely that they will just die off, burdened with debt, increasing costs, and decreasing revenues until they can no longer hang on.
WOW!!!! One of the best posts I read in 2013 (and for free).
Reduce, Reuse, Recycle. The generation after the baby-boomers are used to recycle things, use the electronic version instead of the printed version (and inky fingers) of a throw-away product, and let’s face it, we believe stronger toilet paper makes you want to use less of it (how’s the 3-shell idea from “Demolition Man” movie?).
Our baby-boomer parents still prefer the good old printed version, even if it means using a magnifier.
And today, I still wonder why Montreal newspapers prints out from one facility and truck-delivers to regions (think Abitibi… and Florida) daily when they can upload the file to local printing facilities and deliver quickly in early morning. Same goes for international magazines and newspapers, shipped by plane. Electronic version remains quicker to those living outside the big cities.
These things don’t come out of inkjet printers. There’s no sense in setting up separate printing facilities unless you’re running large print runs. (Most printers won’t do less than 10,000, and none of those far-out regions have anywhere near that kind of readership). A paper like the Globe and Mail or National Post or New York Times will be printed out of multiple printing facilities, but it just doesn’t make sense for regional papers.
I meant, Quebecor and Transcontinental have regional printing facilities for local newspapers and the Publi-Sac. It makes no sense to ship the JdeM by bus and receive it at 1pm in Val d’Or then later Rouyn when Quebecor is printing out the weekly L’Écho Abitibien from there. Printers are already setup for the amount of copies necessary for the region. Just sayin’.
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Super job, Steve. Thanks
Great job, Steve.
Congrats for La Presse for taking a bold direction. The results are good and hope well for the future.
As the executive mentions, the costs are fixed and I am then wondering why is it limited to Montreal or Québec? If it’s an application that built to latest standards and great content, it should then lead the way worldwide.
It’s not then about 100,000 or 200,000 subscribers, it’s about having 100 million or more, which would make sense for the $40m investment.
It’s not. La Presse+ can have readers all over the world. But its reporters are still based in Montreal, and it still carries Montreal news.
Que va t’il arriver quand mon ipad2 sera hors de porté des mises a jours de la pomme, pas sur que je pourrais encore lire la presse+ sans migrer vers une version plus récente, puisque la presse+ voudra elle aussi améliorer sa performance …a ce rythme j’aurais une collection de ipads dysfonctionnelles très bientôt, si on se fit a la vitesse ou Apple nous en présente des nouveaux…
This is an outstanding article with thorough research.
We don’t see that often enough… Not even on Lapresse+ :O)))
Congrats and thanks !
Keep in mind most of the research came from Guy Crevier and the team at La Presse. I’m just repeating it.
No matter how many readers you still have for the paper version , when you know where the industry is heading if you did not already move years ago you are too late.
The problem with newspapers is the same as for the rest of society,politicians and business leaders. The baby boomers are the deciders and will not move until they have no choice. Our system is based on a career that lasts up to 65 years old and then you retire. Not anymore ! So there is something crooked about the system.
They are picking up but way too slowly and since the younger generation is left behind because they have no experience… Like when they discovered the laptop the rest of us were already gone to the i-pad .
The way things are going they seem to be waiting for their customers to tell them what to do. Paying customers that is,important customers,advertisers.
Great post by the way mister Steve.
Great post, interesting discussion.
I was told by an acquaintance of mine who works at La Presse that the obituaries are next on the development front. That’s been a major peeve of mine, mostly because one pays *a lot* to have them published and the visibility was nil in the app.
With all due respect : no one has seen the future and knows where the newspaper business, or the news business for that matter, is going.
I was a bit critical of La Presse + when it came out a few months ago. I must say I am quite a bit less critical now. When many papers all over North America post 50% reductions in revenue over the last year, maybe the strategy of being the last man standing is not the right one anymore.
The economic model of La Presse + may not be the perfect one. But neither is that of traditional papers who do set up firewalls and hope for the best. Crevier makes a good point : the NYTimes or The Economist may survive in that environment. Regional papers may not.
At least, La Presse is trying something new instead of just maintaining the old model. And they are not hiding behind the so-called «language wall» that could be a very easy excuse not to do anything for francophone papers.
Again, no one has a cristal ball on this one, least of all me. But the jury is still out on this experiment at La Presse +. Not sure I could say the same about most local newspapers…
I have to agree with you here, nobody has a crystal ball. You don’t really need one however to see where the print media is going, the trend is there. Their only saving grace at this period is that it may take a couple of decades for all of their existing over 50 / over 60 readership to finally die off (sad to say). There will be a point where those people are not enough to sustain the business model anyway, and then the argument becomes moot.
Lapresse+ is a huge step towards the younger generation, but to some extent it still has it’s foot planted soundly in the print era. Spending a lot of time and effort (not to mention bandwidth) on custom made pages is perhaps something they will learn to live without. Over time they will also likely realize that while Apple does pretty much own the tablet market, there are any number of companies making phones with screens 5 inches and bigger, and those are nearly equal for the job. From where I live, I can tell you that android based tablets are a force to watch out for, the Chinese companies are easily able to mimic the size of the Apple products, and Android is the free operating system most of them use. Just like the smart phone market, Apple may have “invented” it in most people’s minds, but they are quickly falling behind companies like Samsung when it comes to product selection and market coverage.
As for regional papers, I have mentioned before here that I think that the next (sad) step will be a more generic “national” paper with local touches before printing. As an example, picture the gazette as having page 1,2 and 3 being made locally, the first page of sports, and the rest of it being a “national” paper created one time in one place, with perhaps a few places to place ads locally on those pages. Otherwise, it’s very likely to come to that, where the local news is produced by a very, very small group of people, and the layout is done almost exclusively in a central location. So every city would see the same 40 pages (or whatever) and get 3 or 4 pages of local, and it’s done. That is the next logical stopgap before shutting the doors.
I do not agree that no one knows or knew where the business was going. It has been obvious for years that the paper version was one day doomed.All that Remains to be seen is if there will be collectors editions left for the die hard readers for a while at least. So right then was the proper timing to get ahead of the competition.
For a decade at least now we can get our news on the web and now that the web can fit in our pocket it is even more obvious that this is the way to go.
La Presse does benefit from the fact that the Québec french market is on another language level but other newspapers may not be so relevant no more since we can get the information right from the horses mouth now.
The wait and see attitude should now be seen as a too late attitude.
The only remaining factor to be discovered is how the electronic newspaper will evolve. For example can a Toronto based newspaper have as much Montreal content as the Gazette for instance and take the market all over the country ? With the net now this is possible. So the ones still relying on the paper version now waste their energies on outdated idea when they actually should explore new avenues.
Sure. But where does it get that much Montreal content?
In Montreal of course. What i mean by that is that it may become more of a global thing, not necessary to have an office and a staff in MTL so if it is the trend of the future ,one must think of it now, not when it is a done deal.
L’hivers dernier j’ai assisté à une conférence sur l’avenir des médias donnée par Pat White, c’était un peu avant l’annonce de La Presse+, il avait mentionné que La Presse songeait à abandonner sa version papier en 2018…
(+) Eric Schmidt (Google chairman) declared this today at the Magazine Publishers Association conference: The Future of Magazines Is on Tablets.
Great minds think alike?
This is a great move. The decision is bold, yet it makes sense.
However, how you spend 2 million on research and another 8 million on software so simple is beyond me. Comparing the price to something more expensive is a strange argument. It’s pretty and looks different, but it’s not something hard to build. The price tag is just too high, just like on all software in the publishing industry.
The software is still, by their own admission, incomplete and even more money will be spent on making the Android version. The bill can still double.
I’m sure that LaPresse could have increased their chance of success by hiring a better (rather than larger) technical team. They can’t change the past, but hopefully other companies will finally learn from that experience and make such bold moves at a fraction of the cost.
The research was expensive because there was a lot of it. It might seem obvious now that they’ve launched, but from the beginning it wasn’t obvious what they would do. It wasn’t long ago that the idea was to give people free iPads with yearly subscriptions to move them from print to digital. There were lots of avenues explored that weren’t taken.
As for the software, it’s not as simple as it might seem. There wasn’t software that does what La Presse wants to. And so it needed to make a bunch of different software work with each other and create some of their own.
Crevier didn’t describe it this way. He said he’d like to redesign the tab that gives live news, but otherwise he’s satisfied with the software.
Please tell me La Presse’s strategy isn’t partly based on this assertion:
“The reason why La Presse+ launched just for the iPad is once again about numbers. Nine out of 10 tablets are iPads.”
In what world is that true? In May, Apple’s table market share “dropped below 40% to 39.6% in the first quarter, from 43.6% reported for the holiday quarter. Apple lost 18.6% of its market share in just a year, when it held 58.2% of the market in Q1 of 2012.” (source And the trend is not in the iPad’s favour.
Those statistics are based on tablet shipments, but if you look at tablets in actual use, the number is much higher for iPads, closer to 80-90 per cent because of Apple’s historical dominance.
Of course that’s changing, and Android tablets are being sold in much larger numbers now. But for right now, it makes more sense to develop for the iPad first.
It’s been a long, long time since I came across a newspaper publisher doing exactly what I think he or she should be doing.
This strategy is nearly flawless and truly insightful into how to mold different strategies for different mediums. It’s what I’ve wanted to do for at least two years for my publicaiton but simply lack the resources to do it.
Personally, I’d charge for the app, but otherwise, I say Bravo!
La Presse spent $CAN40 in trying to figure out the future of news media. Fantastic. I’m glad there are people in media companies trying to figure it out and put money and efforts to try do it correctly. Bravo!
That said:
– $40M is a LOT OF MONEY for an app even if I understand all the possible ramifications. But still. Wow!
– Betting on advertising. In the US, alone, the newspaper industry has lost 55% of it’s advertising revenue in 7 years. From $US49 billion to $US22 billion. This includes digital ad revenue (11% of the total). It should go below the $US20 billion in the next 2 to 3 years.
– Digital ad revenue is growing for US newspapers. But very slowly. It’s around $US3.4 billion today, a bit less than 9% of the total $US37 billion US digital advertising revenue. In other words, there are loosing market shares. Five players ONLY are enjoying more than 65% of the digital market share.
– Apps leave in a closed environment. They are very difficult to be found / discovered. It might change in the near future. But when you know what you can do with Adaptive fluid design, why going the app route?
Any way, good luck to La Presse.
What is the future for the La Presse smartphone app? (I currently have the Android version on my Samsung Galaxy 4). Will I have to shift to a tablet, or will the phone app be upgraded?
I don’t think the smartphone app will be affected by this. The iPad app wasn’t built for smartphones, so expect the smartphone to deal with breaking news and work more with the website than with La Presse+.
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Thank you for a most informative piece.
I downloaded the app the first day it came out. I had high hopes that the move from the classic online edition to LP+ would be amazing.
Took me a week and my dissapointment was complete. Went back yesterday for a further look before sharing my comments below. Nothing had changed.
1. I find there is way too much on any given page. Background, foreground, sidebars. Just too much is thrown at me.
2. I am unable to distinguish which pages have active tabs vs. Inactive. I find it confusing.
3. When I do find a piece to read I find that a) it is a very narrow column, and b) hard to read with all the background noise.
4. Yes, I cango to “read” mode. But wow, is it ugly and boring. Also, requires more handling. Open, close…
5. Oh the ads. I have zero engagement with the ads. None. Sure they have many templates. Great. I am obvlious to all as i just do not touch them. Having to flip through too many steps to just read the paper the lastt hing i want to do is engage with an ad.
So it was back to the classic edition for me. Yes, i pay for it but at least i am comfortable using it and enjoy reading it. Yes, i do look at ads that interest me.
So having said all of this, i wish LP the best but wonder if advertisers have seen a decline in engagement.
Maybe i am part of a tiny minority but i do suspect that the whole story is suspect because they are giving it away for free.
As an advertiser, I would be suspicious of any magazine that costs zero to download. Thousands will get it. Few will be engaged.
Just my thoughts.
Same thing for me and I continue to pay to read the paper edition on my ipad and on Saturday I read the classic paper edition…. and I think to this point as Setman…
1. I find there is way too much on any given page. Background, foreground, sidebars. Just too much is thrown at me.
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