News Corp. Launches iPad Pub ‘The Daily’ With Big Brand Support

At an event in New York City this morning, News Corp. CEO Rupert Murdoch unveiled the organization’s much-hyped news-driven iPad magazine, The Daily. The app includes ads from major brands such as Pepsi, Verizon, Virgin Atlantic, and Paramount Pictures at launch.

News Corp. executives, including Chief Digital Officer Jon Miller, demonstrated the capabilities of the app and described the company’s belief that high quality content and delivery will help drive increased advertiser interest and investment in the bourgeoning medium of tablet-based advertising.

“We had a chance to create a terrific marketing environment, and have a bunch of things coming that will be truly innovative,” Miller said, adding, “We’re encouraging advertisers to produce specifically for this platform… We believe going forward that only high quality environments are going to command the premiums many people would like to see in advertising.”

Murdoch added, “We feel this is better for advertisers and will draw a better class of advertising at a better rate,” in reference to the creative opportunities and back-end advertiser analytics the pair promised the product will offer.

daily1For its inaugural issue, The Daily features interactive ads from around 10 advertisers, in addition to ads for products from other News Corp. properties such as Fox. The interactivity of those ads varies from simple click-to-video executions, such as the one for upcoming Paramount Pictures movie Rango, to more involved app-like experiences like the one on display from Verizon, which enables users to view a range of content and even purchase products without leaving the application.

To power those ads News Corp. has partnered exclusively with mobile rich media provider Medialets, which was closely involved with the creative process for all the spots running in the first issue. The company trained Pepsi’s agency, Chiat L.A., on how to build ads for its formats, for example.

The Daily will be free for two weeks, starting today, but will then be supported largely by subscription costs, Miller said. Subscriptions are set at 99 cents a week and $39.99 a year. However, the company’s long-term goal is to achieve a 50/50 revenue split between subscriptions and advertising, he added.

According to Murdoch, $30 million has already been invested in the product, and it will run at an operating cost of around $500,000 a week. “We’re very confident of the numbers,” he said, adding, “It’s incredible to believe that something of this production value can be done every single day.”

The production of the first issue is indeed impressive, but it remains to be seen if that quality can be maintained on a daily basis, particularly with regards to advertising. The fact remains that the production costs of such ads are high, and the potential audience is still relatively small. In addition, a number of publishers are already offering similar ad opportunities in iPad based magazine products. From an advertiser perspective, the differentiation between those offerings could be in the back-end data and analytics provided to them, but neither Murdoch nor Miller went into detail about The Daily’s capabilities in that area.

UPDATE: This story was edited to include information on Medialets’ relationship with The Daily.

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