The iPad is likely to accelerate the shift from print to online

When Steve Jobs presented the new iPad, bloggers were quick to criticize the new device. Even during his speech, the limitations of the iPad were already discussed on the internet. The main recurring limitations in these reviews are the fact that the iPad does not have a camera or a phone, the fact that it is not possible to run more than one application at the same  time and its name “iPad”, which draws a lot of jokes related to feminine hygiene (“Yes, the iPad is small, lightweight and slim. But can you swim with it?” wrote the Los Angeles Times’ tech blog). The title of a post at Gizmodo, “8 things that suck about the iPad”, probably brings home the negative message most clearly. After a couple of days, reactions became slightly less polarized and the new consensus seems to be that the iPad is not really a big disappointment, but neither a revolutionary step forwards.

We believe, however, that the iPad is likely to accelerate the shift from print to online media and in this way it might prove to be a revolutionary device indeed. First of all, the shortcomings of the iPad, such as the fact that there is no camera or phone or the fact that it is not possible to run multiple applications at the same time, are relatively easy to fix and Apple is likely to do so relatively quickly.

Second and more importantly, some major publishing houses (such as Penguin & Simon & Schuster) and newspapers (such as the New York Times) have already made a deal with Apple to provide books and access to the electronic version of newspapers on the iPad. Probably, by this deal these big companies are trying to turn the trend from print to online into their advantage. Until now, almost no consumers have been willing to pay for online content, but with the iPad this might change, comparable to the revolution in the online music industry. Although the music industry still blames Apple for its near monopoly in digital downloading of music with the iTunes store, Apple has proven to be almost the only company – and definitely the most successful one – in getting consumers to pay for online music. With the iPad the same pattern might repeat itself, but now for online books, newspapers and magazines. The fact that major publishing houses and newspapers are so eager to play a role from the very start might just prove that.

Third, in looking at business developments we have always found it very useful to investigate the reaction of the competition. In this case, firms that have put dedicated e-readers on the market, such as Amazon (with its e-reader Kindle) or Plastic Logic (with its e-reader Que proReader), have started to make their products more multifaceted and exciting, exactly because they have since quite some time expected the entry of Apple onto their terrain. Most of these firms have also decided recently to allow software developing companies to create applications that could run on their products in order to make them more versatile.

Finally, although we know there are many reasons not to do so, we think in this case it might be useful to look at history to predict the future. Taking into account Apple’s excellent track record of revolutionizing industries, we believe Apple’s iPad will now take on the online print industry. The main stakeholders, such as major newspapers and publishers, and the main competitors, such as the producers of e-readers, are betting on it and we are following this bet.