E-media presents as many challenges as it does opportunities for publishers

Take News Corporation, for example. Founder, chairman and chief executive Rupert Murdoch announced last year that he intends to charge for the online content of his publications, and indeed The Times' website made the move to paid-for content just a few weeks ago. As a result, thetimes.co.uk recorded a decline of 66% in its share of web hits of all media companies.

Scutinising the figures, The Guardian concluded that, taking into account free pre-registration of subscribers of
the printed issue, that thetimes.co.uk had lost 90% of its web traffic.

Actually, this is pretty much what was expected by News International, but it's not necessarily as bad as it's going to get. Currently, The Times is running a low-cost trial subscription of just £1 for 30 days, instead of £2 per week as planned. On top, there is a hefty reduction in online advertising revenues, as these are generally priced according to the actual views made by consumers.

We already know, thanks to many surveys, that consumers aren't exactly rushing to pay for online content. This is confirmed by a recent study from the Annenberg School on online social networking, which showed the most striking reaction so far – that, in fact, none of the 1,981 respondents were willing to pay to use Twitter, despite the fact that 49% of them said they used social networking sites.

Decisive factors
It is seldom that consumers' views are that decisive and it underscores the difficulty of getting internet users to pay for anything that they already receive for free.

Even if users are willing to pay, it can sometimes be a bumpy ride. German newspaper Die Tageszeitung pulled its offerings from the iBook store for the iPad. Die Tageszeitung admitted having a good start, climbing to the number-one spot in the German book charts within four days, but then problems and limitations started to pour in.

Originally, the download should have been available from 10pm onwards, but Apple's internal approval and release processes for new iStore content meant that issues could be delayed by up to several days – not an option for a daily newspaper. Die Tageszeitung resorted to a loophole by simply updating content of issues they already sold, which is not affected by the approval process. The obvious problem with this strategy is that the Apple store does not allow charging for the update, as the original issue has been sold already. Apparently, Apple was not helpful in solving these issues, so Die Tageszeitung opted to drop its support of the iPad (while still offering e-papers for open formats).

While much of the expectation of e-publishing is driven by reading device hardware providers, such as Amazon and Apple, an interesting development is emerging from the Indian government. It wants to bring a $25 tablet computer to the market, primarily for 25,000 Indian colleges, linked to plans to get them all connected to broadband.

The bill for hardware going into the proposed tablet PC stands at $47, which does not even include labour, supply chain costs or profit. Mass production could bring the costs down, although it still would not get close to the $25 price point. But the main challenge is to get enough interest in a new device to even bring down the price. It remains a chicken and egg problem – how to sell enough tablets to bring the price down so that it is attractive enough to prospective buyers.

Ralf Schlözer is associate director at digital print and document technology analyst Infotrends