Steve Jobs Is Wrong: The iTunes Model Won’t Help Media

In his interview with Walt Mossberg and Kara Swisher at the D8 conference (transcribed by All Things Digital and Engadget), Steve Jobs raised the hopes of media executives everywhere — including, no doubt, News Corp. (s nws) CEO Rupert Murdoch, who made some opening remarks before the Apple (s aapl) founder took the stage — by saying he believes people will pay for other forms of media, just as they have been paying for movies and music. This is the closest Jobs has come to endorsing the “iTunes for news” model that many newspaper and magazine publishers have dreamed about. The Apple CEO said:

I think people are willing to pay for content. I believe it for music and video, and I believe it for the media.

And how would this work? Jobs described it this way:

I can tell you as one of the largest sellers of content on the internet to date — price it aggressively and go for volume. That has worked for us. I’m trying to get the press to do the same thing. They need to do it differently than they do it for print.

The vision of an iTunes that served up paid-for newspaper and magazine content to millions of adoring readers has captivated the traditional media for some time. One of the most eloquent pleas for such a model came from New York Times media writer David Carr last year, in a column entitled “Will Someone Please Invent iTunes For News?” Carr described Apple’s success in selling music, and then said he hoped that someone like Jobs would come along and convince “the millions of interested readers who get their news every day free on newspapers sites that it’s time to pay up.”

It seems like a slam-dunk idea in so many ways: If record labels can cut a deal with Steve Jobs that sees music sold through iTunes instead of being downloaded for free, then why couldn’t newspapers and magazines do the same thing with their content? Bundle it up, cut a deal with Apple to create an iTunes for news and watch the cash roll in.

But this vision has two fundamental flaws — one psychological and one economic. The psychological flaw is that news stories and other forms of content that appear in newspapers and magazines (with very few exceptions) are not the same as music or even movies or books, in the sense that users want to keep them forever and read or watch them repeatedly, as media gurus Clay Shirky and Jeff Jarvis have also pointed out. In addition, all of that content is currently available in a completely legal way for nothing, from the websites of the content creators themselves, whereas music and movies are not.

Both of these factors suggest that the price for news would have to be orders of magnitude lower than it is for music — pennies, or even fractions of pennies, instead of dollars. Is that really a viable model for these media entities?

The economic flaw, meanwhile, is that cutting this kind of deal would involve handing over control of a significant part of your newspaper or magazine’s destiny to Steve Jobs. Is that really a bargain that media outlets want to strike? It’s true that Apple has sold billions of songs through iTunes since the store launched, and that has done great things for one company: Apple. Record labels and movie studios, for the most part, haven’t seen truckloads of money come their way from the arrangement. If anything, iTunes pricing has put downward pressure on the prices they charge for CDs and DVDs.

The bottom line is that an iTunes for news might be in Steve Jobs’ best interests — primarily because it might help to sell iPads — but it’s not clear that it would be in media outlets’ best interests, as attractive as it seems. Nor is it obvious that it would even work, if it ever actually came to pass. More than anything, it feels like an industry grasping at any straw it can, in the hope of building a life raft.

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Post and thumbnail photos courtesy of All Things Digital