• by Mark Walsh  @markfwal, August 13, 2010

Rupert Murdoch plans to roll out a new national digital newspaper distributed through mobile handsets and connected devices including the iPad. According to a Los Angeles Times story today, the News Corp.-owned newspaper would target a general readership and compete with the likes of USA Today and The New York Times.

The newsroom will be overseen by New York Post managing editor John Angelo while relying on the editorial resources of the Post and Dow Jones. Consistent with the digital versions of other News Corp. properties like The Wall Street Journal and the Times Online, the company will charge an as yet-to-be disclosed fee for the new digital publication.

Earlier this month, Murdoch was bullish on the prospects of luring back young readers through the new newspaper app expected to launch by year's end. "We'll have young people reading newspapers," he said during the company's Aug. 4 earnings call. "It's a real game changer in the presentation of news."

But that noble aspiration is at odds with Murdoch's dedication to charging for digital content -- something younger consumers especially are reluctant to accept unless it involves a game or related content. After News Corp. put up a paywall in June, The Times Online lost 90% of its readers in July as compared to February. That's to be expected, and the steep drop-off in readers doesn't necessarily mean the effort won't ultimately break even or become profitable with a much smaller but paid user base.

Meanwhile, the online Wall Street Journal has been charging since long before Murdoch acquired the newspaper and has extended that model onto mobile devices. But it's hard to imagine folks under 30 or 40 flocking to a paid newspaper app with no built-in readership or brand value. That's especially true when established rivals like USA Today are still offering competing apps for free.

Further, the iPhone and iPad owners who would presumably make up a big portion of the subscribers for News Corp.'s digital newspaper tend to skew older. People 35 to 44 make up the biggest single segment of users of the Apple devices.

From a business perspective, the best thing the newspaper app would have going for it is low operating costs, since it's relying on existing resources rather than starting from scratch. To the extent it can leverage the New York Post's celebrated sensationalism to expand its audience, it could prove a modest success for News Corp. But if so, it won't likely be because teens and 20-somethings started snapping it up.