Why We’re Giving Newspapers Three Years to Live

If you’ve still got a death grip on that dusty old newspaper, prepare for a rude awakening.

Pew Research reports that due to the burgeoning mobile market, mobile news has finally overtaken print newspapers.

The group found that 47% of Americans accessed news through a mobile device in 2010. And that number jumps to 67% for adults under 30, almost double the amount in 2007.

If that rate continues, we could see the end of print newspapers altogether by 2014 – especially when you consider that the main driving force behind mobile news is just catching its stride.

I’m talking about tablet computers.

Even with Apple’s (Nasdaq: AAPL) historic iPad launch, only 7% of U.S. adults currently own a tablet device. Translation: This market offers incredible growth potential.

News publishers certainly aren’t blind to the trend, either. As one publisher says, “Apple will have such an insane percentage of the tablet market. It’s practically the only game in town.”

Problem is, these publishers are going about it all wrong…

A Note to Newspapers: Take Your Subscription Fees and Shove ‘Em!

You see, consumers now have limitless ways to access news without paying a single red cent. But instead of developing an app and offering free subscriptions, some publishers are charging for access.

Oh, dear.

Take News Corp’s (Nasdaq: NWS) app, “The Daily,” for example. When the company announced that it would cost $0.99 a week, Stephen Colbert said it best: The app offers “all of the convenience of using your iPad to read the news online, but without the Internet’s annoying habit of being completely free.”

That said, even companies offering free mobile news apps aren’t home and dry, either.

The key to dominating this industry is user experience – i.e. making apps slick and intuitive. So as I said before, look for companies that develop “free applications that run especially well on the iPad.”

And no one does that better than the current top dogs – Flipboard, Pulse and Zite.

Basically, these apps aggregate news stories based on your specific interests, so they’re like your own personal news source. And they deliver articles in a polished, easy-to-read format.

I use all three apps on a regular basis. They’re all solid competitors that offer a unique experience, depending on your preferences.

But right now, the hands-down biggest player is Flipboard.

A $50 Million Head Start

Flipboard’s intuitive, magazine-style approach to delivering news has won the company deals with over 17 big publishers so far. That includes last Friday’s announcement about a deal with Oprah Winfrey’s cable network, OWN.

This alone puts Flipboard ahead of the pack. But things just got even rosier for Flipboard now that it’s raised $50 million, pushing its valuation up to $200 million. Given that Flipboard’s first round of funding garnered just $10.5 million, that shows a huge jump in investor interest.

And those investors include some big hitters: Comcast (Nasdaq: CMCSA), Insight Venture Partners, Kleiner Perkins, Index Ventures, Twitter co-founder Jack Dorsey and Facebook co-founder Dustin Moskovitz. Heck, even Ashton Kutcher is on board.

So why is Flipboard grabbing all the attention?

Two reasons include the fact that it works closely with individual publishers during the design process and has a high respect for publishers’ content.

As Flipboard’s CEO says, “Anyone not respectful of others’ content is going to get in trouble. There isn’t one half to this equation.”

Either way, there’s no question that the company has taken center stage. And now that Flipboard plans to use the new cash to hire more staff, expand internationally, and launch its app on the iPhone and Google’s (Nasdaq: GOOG) Android phones, it’s obvious that it doesn’t plan to give up the top spot anytime soon.

Good investing,

Justin Fritz

You May Also Be Interested In:

The Unstoppable Monster Money Manager

If you’ve still got a death grip on that dusty old newspaper, prepare for a rude awakening. Pew Research reports that due to the burgeoning mobile market, mobile news has finally overtaken print newspapers. The group found that 47% of Americans accessed news through a mobile device in 2010. And that number jumps to 67%...

Justin Fritz

, Executive Editor

View More By Justin Fritz