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Postmedia unveils new app strategy in Ottawa aimed at bolstering digital future

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TORONTO - Postmedia Network Canada Corp. (TSX:PNC.B) says it has listened to its readers and is transforming its digital operations to better reflect the realities of news consumption in the Internet age.

But the company isn't declaring doomsday for the old-fashioned newspaper just yet.

On Tuesday, Postmedia launched the first stage of a plan to redeploy its resources based on the results of a poll with 17,000 Canadians across the country, who were asked how they consume the news and what kinds of content interest them.

Starting with the Ottawa Citizen, the research has resulted in a redesigned newspaper and website, and new smartphone and tablet apps.

The new strategy is years in the making, said Postmedia chief operating officer Wayne Parrish. Postmedia has struggled to adapt — as have other newspaper companies — as readers have largely migrated to the web.

In April, Postmedia reported that its second-quarter losses hit $25.3 million, from $15.8 million a year earlier, while revenues dropped 9.1 per cent due to continued declines in print advertising sales.

"We reached a point in the early part of 2012 where we came to understand that the pace of change — and especially the pace of deterioration of print advertising revenue — was such that we had to kind of radically reinvent things," said Parrish.

The strongest signal from the poll was that readers valued local news above all else and wanted to be able to access it on all their digital devices — but in different formats that suited each platform, said Parrish.

The Ottawa Citizen's website has been revamped with a responsive design, which means it should display well in any browser, be it on a desktop, laptop, smartphone or tablet. The paywall allowing access to 10 free articles a month remains intact.

A new mobile app has been launched targeting the 18-34-year-old demographic, which delivers news in a social media-inspired burst of short and to-the-point items.

Those brief stories will largely focus on local news and sports, traffic and weather. For anything else that happens outside Ottawa's borders, readers must head to the web.

"It's speaking specifically to an 18-to-34 audience about the news that they say they're most interested in and the things they care about the most: going out, learning about city planning — surprisingly it's a big issue for them, the state of their city — so that's what the smartphone (app) is trying to deliver on," explained Rob McLaughlin, an editorial vice-president with Postmedia.

"It's what would happen if Twitter was put together with talk radio, how would that feel for the audience who wants to know what's happening now, who takes pride in their sense of knowing about things first, but doesn't want to read a long narrative on the phone."

A new tablet app is reminiscent of News Corp.'s failed The Daily, a subscription-based digital newspaper tailor-made for the iPad. It was launched in Feb. 2011 and was shut down a little under two years later.

Postmedia's take on the concept — which is targeted at the 35-to-49 demographic — will be delivered to subscribers' tablets each weeknight at 6 p.m., with a mix of the day's top stories and feature articles wrapped in slick magazine-like layouts with interactive components, including full-screen video and audio.

Each issue is designed to occupy at least a half hour of a reader's time, although they could spend much longer with it if they read every story, said McLaughlin.

Postmedia will let readers preview the app free for 30 days before charging $10 a month for access. It can also be bundled with other subscription plans.

"Do we believe there's a desire for news and information in the evening, in this format? With the research that we have based on the markets, we've made a pretty good bet there I think, absolutely," McLaughlin said.

"Research shows much higher and longer engagement times for evening audiences on (tablets), it's a different kind of need around the kinds of news and information, much more time to reflect, much more desire to understand, but also a big desire to be entertained."

The smartphone and tablet apps are available for Apple and Google Android devices but not BlackBerrys or Microsoft products.

The refreshed printed newspaper will focus less on reporting yesterday's news and more on analyzing it, said Lou Clancy, Postmedia's senior vice president of content, adding the target market for the paper is readers over 50.

"The day starts with your printed product but you already know what happened yesterday in this world," Clancy said.

"We accept that our audience knows essentially what's going on so we're going to tell them why it's going on, what to expect as a result."

After a few weeks of analyzing how readers in Ottawa respond to the new print and digital products, Postmedia will look to replicate the redesigns at its other newspapers (with the exceptions of the tabloid Vancouver Province and National Post, which will have different looks) over the next 12 to 15 months.

Postmedia's plan comes in the wake of Power Corp.'s announcement last week that it will one day jettison the printed version of the Montreal La Presse newspaper and focus on a digital product.

Parrish said he wasn't surprised by that news.

"From my perspective it's not anything new, (co-chief executive Paul Desmarais Jr.) has been pretty consistent in his conversations about that being their ultimate direction, I think the one thing that's always remained in question is the particular timing," he said.

"We see a longer runway for the print product but we see it as part of a four-platform (strategy)."

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