Okay, so Steve Jobs didn’t save journalism as we know it when he launched the iPad on Jan. 27. The company unveiled no sweeping partnerships, and didn’t introduce any new revolutionary-sounding business models.

But don’t dismiss Apple’s ability to help publishers just yet, with this intriguing new device. Let me be clear: I don’t know for sure what Apple plans to do (who knows, maybe Apple doesn’t either). But it seems to me Apple said enough for us to make some assumptions about general direction, that could bode well for print news organizations that want to create iPad versions of their publications.

So here are my predictions:

1. A More Hands-Off Approach: Apple could have announced an iNewstand (or somesuch name) wing of the iTunes store yesterday, along with the new iBook Store. But it didn’t. Instead, it had the New York Times get up and show off an App it is building specifically for the iPad. So it’s no leap to assume Apple plans to adopt the App Store model used by iPhone developers, which would give publishers far more control of their own businesses than music labels and Hollywood studios have had (and come March, book publishers). All of those media types are sold straight from the iTunes store, enabling Apple to set pricing, choose what promotions to run, and essentially own the relationship with the consumer. “It looks like Apple is not trying to position itself as a middleman [in the journalism business],” says a relieved Roger Fidler, program director for digital publishing at the Donald W. Reynolds Journalism Institute. “That opens up far more opportunities for newspapers.”

2. A Rising Tide Of Apps, And Increasingly Lucrative Ones: If I’m right about this Apps-based approach, then of course there was little blockbuster news at the launch. Only a handful of developers had even seen the iPad before launch day. The situation isn’t that different from what happened with the iPhone. When it was launched in 2007, there were zero apps—of course, since the App Store wasn’t launched until a year later. But it didn’t take long for the apps to begin piling up after that, to more than 130,000 today.

That’s a tough act to follow. But if the iPad gets off to even a decent start, you can bet most major pubs will be creating iPad versions in short order. Their content will look great on that big screen, and will be more enjoyable to navigate using the multi-touch screen. And if they don’t do an app, the only other way of reaching readers through the iPad is through its super-fast browser. That’s not much help; it’s just a more convenient way for readers to get to the free content that has undermined or at least complicated the viability of so many of their businesses in recent years.

Customers are more likely to pay at least something for an App—say, $9.99 a month for a monthly subscription (Amazon, for example, charges $13.99 for a month of the New York Times). They offer convenient one-click access, faster performance and can be useful even when there’s no 3G service (not exactly an unknown occurence). As Apple rolls out new software tools, publishers should be able to spice up their iPad apps even more, to further differentiate them from websites. And once people get used to using a pub’s App, they’re less likely to spend as much time on the Web sipping articles for free via Google News or other aggregation sites. Which brings me to the topic of…

3. Advertising: As we reported in our cover story, Apple vs. Google, earlier this month, Apple plans to add technology to let publishers and other developers include new kinds of ads in their Apps—ones that are more fun, more useful, and possiby more targetted to your particular interests and location. For example, you might have a notification pushed to you that tickets for your favorite band have just gone on sale. Rather than be linked to Ticketmaster.com or the band’s home-page, you could potentially be prompted to simply buy them through iTunes—to grab your seats before they sell out, using the credit card you (and 100 million other people) already have on file with Apple. That’s just one of the ideas mobile ad experts have suggested to me. To the extent Apple succeeds with this plan, publications might even be able to take back some of the ad revenues they’ve lost to Google and others on the Net in recent years.

4. Apple Could Use Content As a Competitive Weapon Against Amazon, Google And Others: Let’s face it, Apple can do just fine without putting the screws to its content partners. The company’s core business—selling computers and mobile devices—has never been healthier. On Jan. 25, the company announced a 32% increase in sales for its most recent quarter, with 41% gross margins that are the highest in any quarter in the company’s history, according to Piper Jaffray analyst Gene Munster.

That’s not to say Steve Jobs is going to cut a cushy deal with anyone just because it can afford to. Fat chance. But he may choose to do this because it could give him an advantage over key rivals such as Amazon and Google. While he makes his money on the hardware, Amazon makes money by selling content—so would be less likely to willingly give up as much margin on newspaper and magazine sales as Apple. Google makes its money on advertising, so I wouldn’t be surprised to see Apple offer better economics to publishers that use its ad-serving technology rather than Google’s. After all, the iPad’s success depends in large part on Apple’s ability to get the most compelling Apps on the device. If making it worth Old Media’s time to do so makes life more difficult for Amazon and Google, so much the better.

Reader Commentsrobinson January 29, 2010 4:13 PM

Liked the column!

While I wished Jobs had announced a new publishing sales model, with a parade of book & textbook publisher honchos on stage… you’ve offered some good insights about the iPad’s potential directions and how publishers would fit in. That NY Times app looked spectacular, especially with the automatic reflowing of text when font sizes are changed! That alone is enough to make me get an iPad!

Just hope that if it’s being sold with a monthly sub that it’s less than $10/month!

Thanks for writing the column!

Constable Odo January 30, 2010 10:11 AM

I think its going to take some time for Apple to get everything in place once it finds how much demand there will be for the iPad. It’ll reach a tipping point and then almost everyone will be on board. I’m sure Steve Jobs put a lot of thought into the product and how to sell it. Now that it’s less expensive than most people thought it would be there should be plenty of iPad buyers and advertisers should love that fact. The iTMS has a huge user base to cull from and Apple can just keep adding on more content. One stop media shopping for the masses. Apple is going to have a jump on the mobile industry with the iPad and iTMS.

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A blog on the daily doings of Apple and the many companies in its orbit, with insight and analysis by two longtime Apple-watchers BusinessWeek Senior Writer Peter Burrows and BusinessWeek.com Senior Technology Writer Arik Hesseldahl.

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