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March 16, 2016, 1:46 p.m.
Mobile & Apps
Toronto Star Touch

The publisher of The Toronto Star, which is betting big on an expensive tablet edition, is stepping down

The paper was targeting 180,000 daily app users by the end of 2016. Today, it has about 26,000.

A couple of weeks after an earnings report revealed that The Toronto Star isn’t attracting as many tablet app users as it had hoped to, Star publisher and Star Media Group president John Cruickshank announced that he’s stepping down in May.

“I’m ready to leave scaling new journalistic heights to someone with less arthritic limbs and more recently acquired tools and skills,” Cruickshank said in a self-deprecating statement. He went on to say, though, that “with our latest innovations in digital on tablet and browser, we have sought out a new generation of readers for the Star and enthusiasts for its mission of social justice.”

Cruickshank, 62, had held the position since 2009. He told The Globe and Mail leaving was his decision: “It kind of felt like an era of work was coming to a close, or at least was being completed, and that it was time for renewal.”

The Star stands out among North American English-language dailies as the strongest proponent of a tablet-based digital strategy — at a time when nearly every other paper is putting its focus more squarely on smartphones. (Tablet use is actually declining in many markets, while smartphone traffic continues to rise.) The Star launched its ambitious app, Star Touch, last September; it is built using licensed technology from Montreal’s La Presse. La Presse went digital-only on weekdays on January 1, publishing online and on La Presse+, its free tablet app. (There is still a Saturday print edition of the paper.)

Star Touch uses La Presse+’s platform and got launch help from La Presse’s tech staff. But the papers’ business strategies around the apps differ. As Ken Doctor wrote for Nieman Lab last year:

While both publishers give full-body hugs to the tablet as a print-like, high-engagement, advertiser-attractive product, The Star detours from La Presse’s strategy: It intends to keep its print operation as strong as possible…

“It’s one-third tech, one-third people, one-third transformation,” says Ali Rahnema, The Star’s chief operating officer for digital. He makes the point that the current initiative is a transformation project, with the tablet at its first point. Why? While we know readers and reading is moving profoundly to screens, we can’t see beyond the near future on the what and when of that. We can’t say, ‘The tablet is going to be the platform for the next 20 years, and we can just focus on that.’”

Still, the Star invested hugely in Star Touch, adding more than 100 people to its staff, though some of those positions were temporary. In Torstar’s Q4 2015 earnings report, released on March 2, the company said it had spent $14 million, in pre-tax dollars, to develop the app, though some of that was attributed to “significant marketing costs.”

“2016 is expected to represent another significant year of investment in establishing Toronto Star Touch with an expected net investment spending of approximately $10 million in 2016,” the company said, also noting:

While audience size has been lower than we initially anticipated, we are making steady progress in building readership. Daily audience engagement metrics are strong and advertiser response has been very positive.

Star Touch hit 200,000 downloads on Apple and Android in January (it hit 100,000 downloads in November) and says it has 50,000 user sessions per day.

But those sessions come from only 26,000 daily users. Torstar said last fall that its target was 180,000 daily users by the end of 2016, but on Wednesday, a company spokesman said its current expectation was for daily users to reach 100,000 by that time.

Torstar also said it expects Star Touch to break even by the end of the year.

Star Touch, La Presse+, and Postmedia’s launch of ambitious evening tablet editions have combined to make Canadian newspapers an odd center of tablet optimism not found elsewhere. Postmedia shut down those tablet editions in Ottawa, Montreal, and Calgary last fall after “it just didn’t reach a critical mass of audience or advertisers.”

POSTED     March 16, 2016, 1:46 p.m.
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