Can Discounted Tablets Lure New Newspaper Subscribers?

The rise of the Internet and mobile technology is often seen as a death knell for traditional print media. But the owners of Philadelphia’s two dailies are hoping consumers’ lust for the latest in all things digital will help the newspapers beef up readership and revenues.

Earlier this week, the Philadelphia Media Network — owner of the The Philadelphia Inquirer and the Philadelphia Daily News — announced that it will begin offering deeply discounted tablets bundled with applications serving up content from the papers and their websites.

Although the exact pricing and type of tablet have not been announced yet, company officials said at a Monday news conference that the devices will run on Google’s Android operating system. Tablets typically cost anywhere from $300 to $800, depending on the amount of memory and whether it connects to the Internet via WiFi or a subscription service to a cellular network.

Each tablet will be bundled with four preinstalled applications to view content from The Inquirer, the Daily News and the Philly.com website. To get the discount, customers have to subscribe to the apps for at least a year. The program launches in August with a small number of devices, which will initially be available to run on WiFi-only.

But is the promise of shiny, new technology enough to spur long-term interest in the company’s content? “It’s a case of putting the cart before the horse,” says Wharton marketing professor Peter Fader. “You have to have a really good digital strategy, platform and content in place before you start worrying about portals.”

Stephen J. Kobrin, a Wharton management professor and director of Wharton Digital Press, notes that customers who sign on to the initiative won’t be able to choose what kind of tablet they get, or (at least initially) how they want it to connect to the Internet. “The key is getting people who wouldn’t have otherwise bought a tablet and who wouldn’t have otherwise looked at the Philadelphia newspapers on a tablet, in print or online” — which he points out, “are a lot of assumptions from the [Philadelphia Media Network's] point of view.”

Fader argues that, for such an initiative to succeed, it must capitalize on existing pent-up demand rather than attempting to create it. “It has to fulfill a need, and they’re nowhere near that,” he notes. “In some sense, it’s commoditizing; it cheapens the value of their content.”

Even if customers sign up for the program, there’s no guarantee that the purchase will become the basis of a lasting relationship with the Philadelphia newspapers or Philly.com, Fader adds. “Unless people use the tablet predominantly to access the Philadelphia newspapers … they’ll forget that’s how they got it. If you can’t get people to stick around [as subscribers] then it’s not a good investment.”

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