The Daily: I have not seen Daily News Corp (I was invited to the preview last night, but travel, exhaustion, health, weather, and thus caution has me take the train home and I don ' I failed today due to ice). I have nothing to narrate about the output. I'm studying to get my mind around the economy and I hope that minds better math and business than I will analyze what is needed for daily success.
Rupert Murdoch said that the newspaper had $ 30 million in development costs already amortized. He said that operating costs will run $ 500,000 per week. So in the first year, cost about $ 55 million Daily. It's a lot. For comparison, the portfolio has been somewhere between $ 40-100000000. I said we'd never see another launch of the publication of that scale. I was wrong. Also for comparison, failed aggregator News Corp., Project Alesia, went through a reported $ 30 million.
Say that the circulation covers the costs of Daily - Since receiving income on consumption is the real point of the year - and that advertising is profit. Note that I have no reason to believe * that the News Corp. strategy. It simply produces it easier to illustrate the economic aspects and issues I hope other reporters tackle.
The Daily is for sale at $ 1 per week or $ 40 per year.
So how many submarines would they have to sell to balance the cost 500k/week $? (Note that the breakeven on an operating basis, not on the total investment.) It's a little over 500k subs for $ 1 each, for the reasons below.
FIG Apple takes something less than its share of 30% of normal for the privilege of having the Daily. Murdoch has said he will be on all major platforms table, but then he enjoined that last yr this year and next year "belong to Apple." (I have no idea if he means that metaphorically or contract.)
Also appears that there will be churn as it was in the sales magazine iPad. This means that - as he always does with sales under - that we must sell subscriptions to replace cancellations to reach your magic number. Say that the newspaper lost and I take this figure of a hat-10% per month, it needs replacing. So if you sell 100k this month, you expect to deal 110k ulterior month to get to 200k and 120k next month to reach 300 and so on.
I am not qualified to run these numbers, I want someone with experience would circ. But to choose another number of the hat, say that the 750k daily needs submarines to hit net cash flow balance in which about 25% of sales circ goes to Apple and half of the submarines are on sale at 20% discount. With churn, they needed to sell a intact of up to one 1000000 gross to reach that number, taking into account customer acquisition (marketing) costs of, say, $ 10 (which is light, but an effort to promote Apple, probably not unreasonable).
