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1/27/2010
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Apple iPad Promises Media Revolution

The early speculation is that the tablet brings publishers hopes of new revenue for digital content while ushering in a shift in how users interact with the Web.

It's no secret that publishers have had a tough time making the adjustment from selling printed matter to electronic bits. Shuttered newspapers and declining circulation have led to Congressional hearings about the fate of journalism and have put Internet companies like Google on the defensive. Book publishers have been fighting to retain their power and revenue stream as Apple, Amazon, Google, and others have laid the groundwork for better digital distribution.

Apple in particular has been a pioneer in this area, proving with its iPod and iTunes Store that people will buy digital music online if the experience is simple and convenient. When Apple opened the iTunes Store in 2003, there was still widespread skepticism that music could be sold online when it was widely available for free on file-sharing services.

With Apple's new tablet, publishers now have a framework to deliver and present high-value digital content. Apple has even designed a special app for books on the iPad, called iBookstore.

"For years, people have been concerned that the Web will put publishers out of business," said David Wertheimer, CEO and executive director of the Entertainment Technology Center at the University of Southern California, in an e-mail. "If you saw the New York Times on the iPad today, it should give you great hope that high-quality publishers will be able to build an entirely new business model on devices like the iPad, especially when publishers focus on what makes them relevant on a high-performance interactive platform, [as opposed to] a passive reading/viewing canvas like print."

There are no guarantees, however. Getting people to pay for digital content remains difficult.

In an online post on Tuesday about his hopes for Apple's tablet, Web designer Derek Powazek succinctly frames the dilemma facing those seeking to publish digital content. "The problem for the Web ventures has always been how to pay for it," he says. "And as someone who’s designed site after site hoping to get consumers to open their wallets, I can tell you: It's not easy. Print still has a tangible, innate value. The Web does not. That's why I publish Fray on paper -- because people won't pay for it any other way."

Proof of that surfaced the same day when the New York Observer reported that Newsday, a Long Island, N.Y., daily newspaper, spent $650 million putting its content online and behind a pay wall and had a mere 35 paying subscribers after three months.

Apple meanwhile has had over 3 billion apps downloaded from its iTunes App Store in the past 18 months. It has sold over 6 billion songs. Its online ecosystem for digital content provided the proof of concept for Amazon's MP3 Store and a variety of similar ventures. Its iPod touch and iPhone have led to the creation of over 140,000 apps. Apple knows how to move bits. This explains why digital content purveyors outside the music and video business have hitched their wagons to Apple's gravy train.

App developers have something to look forward too as well.

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