Why CNN's Free iPhone App Is Bad News for Print

There are many ways to analyze CNN's decision to make its iPhone app -- previously available for $1.99 -- free. The news brand made the switch yesterday as it rolled out its iPad app, which is also free. One is to note that at $1.99, this wasn't a very robust revenue stream for CNN, which could realize more revenue by getting more users (i.e., more ads).

The other way of looking at it is that this isn't such a good thing for the media business -- particularly the print media, which is currently wrestling with appropriate pricing models for the iPad. (Not that CNN should necessarily care.) What CNN just did essentially recapitulated media's reaction to the Internet in the first place, which was to drop the idea of asking people to pay in hopes that advertising could pay the bills. That hasn't worked out so well.

OK, this argument mostly applies to print, but here's why CNN's free app is still troubling: it contributes to consumer expectation of free. The difference between a news app spawned by a TV network and one spawned by a newspaper company is small. Both have to provide users with video, copy, audio, social features and breaking news. But one, because its legacy model still works, has much more freedom to drop or completely eradicate costs to consumers. The other doesn't.

For many consumers, the decision on whether to download an app, or an iPad media subscription, is price. If they want a good news app for their phone or their iPad, there are plenty of options out there, and with pricing for many media apps at zero, it becomes more likely free will become the default.

Related:

• Apple's iPad Closes Out 2010, but Still Isn't Print's Savior
• Washington Post Brings a Subscription Model to iPad-- but How?
• People Breaks Ranks, Makes Its iPad App Free to Subscribers. Duh
• Note to Magazine Industry: Your iPad Apps Are Too Expensive
• Flipboard: More Proof That Magazines Are the iPad's Killer App
• iPad Paid Media Apps: Still Not Hot, But Maybe That's Good
• iPad/Paid Media Love Affair? Not At These Prices
• Apple's iPad a Print Savior? Three Reasons Why It's Not Even Close