Peter Kafka

Recent Posts by Peter Kafka

Sony Recruits News Corp. to Give Its Reader Line a Boost

howard-stringerHow do you catch up to Amazon in the e-book race it is running away with? Maybe exclusive content will help.

That’s what Sony says it is trying to do with News Corp. and some of its publications. The partnership the two companies announced today won’t be nearly enough to make Sony’s Reader line competitive. But it does point in the direction both companies would like to head.

Dow Jones (which owns this Web site) will sell a version of its flagship Wall Street Journal for the Reader devices, as well as a “Wall Street Journal Plus” package that includes a second mini-edition of the paper to be published at the end of the day. Also on offer: A Reader-tailored version of the Marketwatch finance site and a subscription to the New York Post.

Sony (SNE) will have the only e-reader that sells the Post and the second edition of the WSJ. But that’s about it as far as exclusivity goes. The regular Reader version of the Journal looks to be the same one Amazon (AMZN) is already selling at the same price: $15 a month for the basic edition.

And even if you’re one of the people who loves to read a print paper on a handheld device, most of these offers don’t make a lot of sense for an e-reader.

The Post is a tabloid that’s pretty much designed to be consumed, then tossed away, in the course of a subway ride–and if you want to get it for free on the Web, you can do that too.

You can also consume all of Marketwatch for free on the Web, where it makes much more sense to do so, since that the site provides constant updates on…the market.

And given the Journal’s increasing emphasis on speed and breaking news, you’d think its paying subscribers would want the freshest copy possible. But the Sony Reader version is completely static.

So this is pretty much a symbolic deal, right? More or less, Sony CEO Howard Stringer told a press conference this morning. The big picture, he says, is that devices like the Reader are both a growth business for Sony and an opportunity for content owners to charge for stuff that has been free on the Web.

“The sense of losing control of our content is on all of our minds,” says Stringer, whose company is famously both a hardware manufacturer and an entertainment provider. “We’re trying to preserve the value of content in both movies and music and newspapers.”

That dovetails with News Corp.’s (NWS) big-picture plans, which CEO Rupert Murdoch has been has been hollering out at every opportunity: Pay up.

But there’s also a more practical side to the deal for News Corp., which wants to distribute its stuff on as many platforms as possible–and extract better terms than it gets from Amazon and its Kindle platform.

In November, Murdoch said his company was getting up to $6.50 for each $15 Journal subscription it sold via Amazon (AMZN), but noted that this isn’t enough. News Corp. and other publishers have also carped that Amazon keeps valuable customer data for itself.

The Sony deal offers better terms, said Wall Street Journal Managing Editor Robert Thomson, without getting into specifics: “I think you can assume that we’re getting a better deal and that our concerns about customer information have been addressed.”


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