What’s Stopping Print Content on the iPad?

Venture Capitalist David Pakman, a partner at Venrock, doesn’t understand why legacy media isn’t rushing to get on the iPad. He points out that only six of the top 20 magazines have iPad apps and that most media outlets have been hanging back from embracing the new platform:

I think the iPad is actually under-hyped as a device that will transform media consumption. I think, thanks to the forthcoming wave of tablet devices and better netbooks, the consumer PC is basically dead within the next three years (not so for PCs for the enterprise). But with this new opportunity comes the need for content companies to be aggressive in adapting to and adopting new platforms. We have seen countless examples of how native (i.e., purpose-built) applications prosper on new platforms whereas those migrated from a legacy platform never quite work. Doodlejump is the best selling game on iPhone, not Halo. Farmville is the biggest game on Facebook, not Mario Bros. Early adopters of new platforms tend to reap the rewards more quickly than the late entrants. Given the rapid pace of technology adoption (Steve Jobs says iPad is the best selling product Apple has ever released), consumers build loyalty to new brands more easily when they are the only ones available on a new platform. I advise our companies to be aggressive in adopting new platforms. Crunchyroll, a leader in the anime video space online, had a great iPad app available days after the device shipped. It is this level of aggressiveness that the traditional media companies must adopt in order to build consumer mindshare on these platforms.

It is easy to say, “Only 3MM iPads have been sold.” But given there are only 13,000 apps for iPad written so far, there is plenty of room for best-in-class apps to reach audiences much larger than their analog print equivalents. NPR, for example, has a great app that has been downloaded more than 350,000 times (as of mid-June).

The problem is that pre-existing businesses need to be defended. Very few managers have the guts to cut into their revenue in the hopes of building future revenue. NPR is a counterpoint because of the unique nature of the enterprise. It wants to expand as a media source and the iPad app is a great opportunity for NPR—which doesn’t want to be known as National Public Radio now—to run for daylight.

The iPad is a great reading device, but it’s also a great viewing platform. You don’t see many cable channels or pay-per-view services creating direct-access apps. That’s because they’ll face retaliation from Comcast and the other cable operators. They’re locked into the business that they have.

Netflix (NFLX) is free to cut a deal with Relativity because both sides are looking to overturn the table and take advantage of the chaos. Print has fewer disruptive tendencies right now. It would make more sense for some of the stronger Web sites to start using the iPad as a route toward a revenue stream than it does for newspapers and magazines to race toward undercutting their print advertising revenues.

So the question isn’t really that mystifying. And we’re going to have to wait for some time before the standoff between the entrenched distribution channels and the promise of the new direct distribution through the iPad breaks. But like DVDs, once it does, it will change the economics of the filmed entertainment industry, for both both TV and movies. And since everything with the iPad seems to be happening at an accelerated pace (because it’s deja vu all over again) there’s a chance that Pakman will see the dam break much sooner than even he realizes. 2011 is shaping up to be quite the year in the content business.