Monday, April 05, 2010

Apple iPad Game Changer Will Publishers Be Honest About Transition Costs? Probably Not Read Anyway

Apple (AAPL) tops the charts in media buzz. iPad sold some 300,000 units on Saturday. 250,000 eBooksadds to the wow factor. Apps developers are scrambling to get the new stuff out.

The big winners are supposed to be book publishers, magazine and newspaper publishers. The problem with the periodical publishers is that their stocks have already moved because we think advertising is coming back.

Will their stocks continue to move as circulation is saved and print costs decline. It’s all so confusing. The big guys such as Wall St Journal, Conde Nast, NY Times will all have compelling apps. The real litmus test will be what advertisers want to be on. The advertising experience should be superior on the iPad.

Can big media shift gears fast enough and capitalize on the potential of iPad and shed hard printing costs in lockstep. Probably not. Watch for cost control problems at News Corp (NEWS) New York Times (NYT) and others.

Watch for those executives to not talk much about this problem.