The news business just doesn’t work the same way as it did 40 years ago. These companies need to be smaller and more streamlined if they want to be profitable. The Daily had a failed business model from the get-go and never would have succeeded.

John Gruber nailed it with the following from his piece on why The Daily failed:

They set up an operation with $25 million a year in expenses. But there’s no reason why a daily iPad newspaper needs that sort of budget. A daily iPad newspaper of the scope of The Daily might (but I doubt it), but that simply means the scope of The Daily was ill-conceived. News Corporation went no further than taking the newspaper as we know it — the newspaper as defined by the pre-Internet 20th century — and cramming it into an iPad wrapper. You can’t tell me a good daily iPad newspaper couldn’t be run profitably for $5 million a year.

A smaller company with a different mindset would have been able to produce a fantastic publication for $5 million a year.