By itself, this news is interesting as a journalistic endeavor, which will target a specific form factor (tablets) to disseminate information. But there's something more intriguing going on behind the scenes. In order to make this work, new features of iOS will need to emerge.
Daring Fireball's John Gruber believes that for a newspaper -- which requires a recurring monthly subscription -- to work properly, it may require iTunes-based transactions. In order for the transactions to take place smoothly, The Daily will require the use of billing APIs. The billing APIs would have to be delivered via software update to iOS devices. Since Apple delivered iOS 4.2.1 on November 22, it's possible that the next version of iOS will be iOS 4.3.
Gruber speculates that the new software will be debuted at a splashy event that features Apple CEO Steve Jobs and Rupert Murdoch in the coming weeks.
Some may be shocked that Apple is bringing a new version of iOS to its devices so soon after the last, but remember that iOS 4.2 was effectively delayed twice due to bugs.
Will it happen? Since Murdoch has mostly confirmed it, you can count on The Daily launching eventually. Whether or not it requires an iOS system upgrade to work, Apple hasn't said.