When Apple (NASDAQ:AAPL) announced its new News app at its Worldwide Developer Conference earlier this month it was likely meant to be a minor highlight among other new features in iOS 9, upgrades to OS X and, most importantly, the company's new music streaming service, Apple Music.
News will bring curated content into a native Apple app, allow publishers to keep 100% of their advertising revenue (less if ads are purchased through Apple's iAds), and give users content based on their preferences. New York Times CEO Mark Thompson recently told Mashable that, "What's exciting about Apple News for us is the chance to reach a very, very large audience of many millions of consumers."
But some journalists and content publishers have since raised their voices against Apple's News app, believing it to be a major threat to which type of content users have access to, and how they consume content in general. Adding fuel to the fire, Apple recently posted new job openings for editors who will curate the content for the News app.
The threat, some have expressed, is that these new editors will become the gatekeepers for millions of iPhone and iPad users who tap the News app everyday (to read some of those concerns you can go here or here).
And some of their concerns are valid. Yes, Apple (or someone working for Apple) will decide which articles make it to the top of the News app. Yes, this will give that content a serious advantage over other articles and videos on the Web. And yes, dumping news from lots of sources into one app means that readers may not visit a specific website or third-party news app as frequently.
But while there may some risks that Apple News brings for publishers, there is a much bigger problem facing the journalism industry: readers.
Here's the real problem
This week University of Oxford's Reuters Institute for the Study of Journalism released its 2015 digital news report, highlighting the state of journalism around the world. And, of course, it doesn't look good.
"Returns from digital advertising have been falling for years, made worse by lower rates on mobile. But in general, only a few specialist publishers or heritage brands have been able to charge significant amounts for content in a world when there is so much free news available."
The report mentioned that between 2012 and 2013 there was an uptick in paying readership, when many online publications put up paywalls, but that the absolute number of people paying for content has hardly changed over the past year.
"In most countries the number paying for any news is hovering around 10% of online users and in some cases less than that," the report said. Readers in the U.K. are apparently the worst offenders, with just 6% paying for online news at any point in the past year, compared to (the still paltry) 11% in the U.S.
One of the most troubling bits of data from the report though isn't just the fact that people aren't paying (we've known that for a while), but that there's a very high percentage of readers who said they would never pay for news, regardless of the price.
Take a look at these staggering figures:
A whopping 75% of U.K. and 67% of U.S. respondents said they'd never pay for journalism content. To be sure, publications make money from advertising and not just from paywalls, but those numbers aren't promising either. The report mentioned that 39% of U.K. users had installed ad-blocking software on their smartphone or tablet, and that number rises to 47% in the U.S.
Which leads us to the next reason why some media publishers are also unhappy with Apple this month. The company showed off a new version of its mobile browser, complete with integrated ad-blocking software.
But that then begs the question: Is it Apple's job to ensure that users are seeing a publication's advertising? I doubt anyone could argue that point well. And of course, Apple is hardly the only tech company to provide a way for its users to block ads online or on mobile devices.
The fact is that users generally dislike ads, and some publications are adding ads that are exceptionally disruptive to consuming content.
"Consumers' annoyance with advertising and the interruption it causes to their reading experience has led large numbers of them to install ad-blocking software to minimise its impact," the report said.
The bottom line
While I think it can be argued that Apple is both hurting and helping the journalism industry with its News app, I think it's misguided to point the company as a major problem. Especially when it's clear that readers aren't willing to pay for news and are seeking out ways to block advertising. Those are the real problems, not Apple.
Apple's job is to create products and services that people want, and its upcoming News app is just another, small, way to that. It'll hardly bring about the demise of mobile news content, because readers are apparently ushering that in just fine by themselves.
The answer isn't that Apple shouldn't release new apps for content curation, but rather that media companies need to innovate themselves in such a way that makes users want to open their wallets and buy what they're selling. And in that regard, tech combines and publishers are both working toward the same goal.
Chris Neiger has no position in any stocks mentioned. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.