• 4 min read

Can the Cloud Help Me Thrive in a Down Market?

Ever wonder how that Washington Post magically appears outside the door of your hotel in downtown Tokyo?  It’s probably due to a Vancouver Canada ISV called NewspaperDirect.  But wait,…

Ever wonder how that Washington Post magically appears outside the door of your hotel in downtown Tokyo?  It’s probably due to a Vancouver Canada ISV called NewspaperDirect.  But wait, isn’t the newspaper industry in a downward spiral of declining circulation, declining ad rates, and shuttered daily newspapers?  Many blame technology and the Internet.  Yet NewspaperDirect is growing rapidly.  And they’re using Windows Azure.  In fact, they’re one of the largest users in Canada (read more in this recent case study).  I reached out to Igor Smirnoff, VP of Digital, to learn what role Windows Azure plays in helping them change with the times.

It turns out their original business, started 12 years ago, is a digital printing platform – enabling those out-of-market newspapers to be delivered to your hotel halfway across the world.  They are supplied on demand to hotels, airports, cruise ships, retail outlets, corporate and government offices, home subscribers etc., and sold via a traditional license to print.  But it’s a niche product – it has a small customer base and a high price point.  Not a growth business.

They also have a newer digital platform, started six years ago.  As traditional papers scramble to figure out digital news delivery NewspaperDirect’s ePublishing platform, SmartEdition, lets them outsource to provide readers with a high quality, full-content digital replica of their printed edition.  Today over a thousand newspaper publishers partner with NewspaperDirect for their ePaper solution, such as Canada’s Globe and Mail, UK’s The Times and just recently The New York Times to name a few.  I mention large known brands, but really this platform allows the ISV to reach a broader market, including smaller regional and community newspapers.   And unlike other ePublishing vendors who license software or charge development and operational fees, NewspaperDirect’s business model is revenue sharing with zero-operational cost to publishers. NewspaperDirect takes care of hosting, payments, customer service, and technical support.

But where it gets really interesting is their aggregated online newspaper kiosk, a global consumer offering called PressDisplay.com.  This just happens to be the part of their business on Windows Azure.  It’s like Netflix for newspapers.  You don’t subscribe to a particular title.  It’s all you can eat, from 2000+ newspapers, from 95 countries, covering 52 languages.  A companion PressReader app pushes the content to your end device for anytime offline reading.  PressDisplay is a subscription service where customers pay a monthly fee for unlimited access to the entire collection of titles.  PressDisplay.com’s companion app, PressReader, is a top three media app in many European countries and the world’s most popular newspaper app for Android.  Those troubled newspapers – they get to list for free.  Any time their paper is opened by a reader they not only get a royalty fee, they also get credits from the Audit Bureau of Circulation for a “sold digital replica”.  This improves their circulation numbers and helps prop up their ad rates.  What a sweet deal!  Much better than printing at money losing levels in order to get higher circulation numbers… 

I recently had a vacation in Rome so I played around with it on my iPad. I browsed three newspapers with easy page flipping and zoom in/out functionality.  As news unfolded I variously searched on Amanda Knox, Steve Jobs, and Silvio Berlusconi.  Fascinating to compare coverage of Seattle’s own Knox in the Seattle Times versus the British Tabloids, and to read the tributes to Jobs from the Middle East.  Berlusconi, on the other hand, didn’t fare too well no matter where I read about him…  Editors, researchers and students could have a field day with this.  Search engines only show articles freely available online; because many newspapers only have 30% – 60% of their print version online, that leaves a lot out.  NewspaperDirect has 100% replicas.  “All the news fit to print”, so to speak.

When NewspaperDirect switched to Windows Azure from third-party hosting they enjoyed on-demand scalability and more time to focus on their core business.  That’s great, but it’s a familiar story.  Here’s what I really love about how this company and their app use Windows Azure:

  • A bold bet.  They moved the fastest growing part of their business to Windows Azure.  You’ve got to admire that.  Not long ago PressReader offered a few hundred titles available on computers and a limited number of phones; today more than 2000 publications are available on whatever device readers choose.
  • In-house innovation.  They launch improvements on their Windows Azure-hosted kiosk first, and then into the white label ePapers.  So in a sense they use Windows Azure and the kiosk as a public demo center, showing off the newest bells and whistles. 
  • Any end device.  Their app works on iOS, Kindle, Blackberry and Android handhelds and tablets… oh and of course PCs, smartphones, and Windows 7 Slate PCs.  Other ISVs – are you listening?  Windows Azure works really well on competitive end devices.
  • It helps traditional newspapers adapt and survive.  This ISV’s Windows Azure-hosted offerings provide a chance for newspapers to keep up ad rates protecting traditional revenue sources, while modernizing content, increasing its availability, and making it look cool to new audiences like younger people, classrooms, early adopters.  It offers things like translation on the fly, social media integration, and audio for blind readers. 

I recently saw a quote in an article in The New Yorker by Arianna Huffington: “People love to talk about the death of newspapers, as if it’s a foregone conclusion. I think that’s ridiculous,” she says. “Traditional media just need to realize that the online world isn’t the enemy. In fact, it’s the thing that will save them, if they fully embrace it.” 

I think she’s on to something.  Technological change as the good guy.  That’s refreshing.