The Daily Lays Off a Third of Its Staff

The Daily, News Corp.’s attempt to create a digital newspaper for the iPad age, is laying off nearly a third of its staff.

The publisher plans to tell its workers today that it will fire 50 of its 170 employees, according to people familiar with The Daily’s plans.

The move comes 18 months after the tablet newspaper’s high-profile launch, and a little more than a month after News Corp. announced plans to split itself into an entertainment company and a newspaper company. (News Corp. also owns this Web site.)

Employees who produce the paper’s editorial page and sports coverage will be heavily hit by the layoffs, and The Daily will run skeletal versions of those sections from now on. (Update: There won’t be a freestanding editorial section at all, the Daily says (below).) But the cuts will affect other parts of The Daily, including its design and production staff.

News Corp. officials have publicly defended The Daily, which News Corp. CEO Rupert Murdoch thought would serve as a template for newspapers’ transition to the tablet era. Murdoch’s team worked closely with Apple and its late CEO Steve Jobs to produce a publication initially tailored for the iPad.

But while Daily executives say they now have more than 100,000 paying subscribers for its iOS and Android editions, the paper hasn’t been able to live up to Murdoch’s expectations, and the money-losing publication has been under scrutiny since launch.

Earlier this month, following reports that News Corp. was considering shutting The Daily down, Editor-in-Chief Jesse Angelo told his staff to ignore “the haters.” But in a memo, he suggested changes were coming:

    This is the truth about the modern media business — all outlets, including the ones writing about us, are under pressure to prove themselves as businesses. We are no exception, and to be sure, we will need to continue to evolve, adapt and change in order to compete and be successful.

The cuts come at the same time as News Corp. examines costs at other properties in its newspaper portfolio, in advance of its corporate divorce. News Corp.’s flagship Dow Jones unit, which publishes The Wall Street Journal, has quietly been letting go of some of its business executives; last month, Dow Jones shuttered the print edition of its SmartMoney personal finance magazine.

In addition to the layoffs, The Daily will try to save money in other ways. For instance, it will no longer create digital pages that work in both vertical and horizontal layouts, and will produce only vertical pages from now on.

But people familiar with the paper’s plans say it isn’t changing other parts of its strategy, including a recent move to produce a weekend edition.

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