It's designed specifically for the typical Apple user.
You know, instead of the usual bitching and moaning about the "typical Apple user" like everybody else on Slashdot, why don't you try to actually think about this instead of just launching into the usual screed? That fact that you've been modded insightful for basically acting like a 4 year old kind of proves my point.
I have the free BBC news app on my iPad, as well as Reuters and several others. In fact, I've never paid for an app on my iPad (or a track from iTunes for that matter) -- there's so much free stuff out there it's amazing. It's so much nicer to use than a web page, because it's a user interface that takes into account the platform it runs on.
As I've pointed out elsewhere in this thread, the native interface of an iPad application (and, indeed I bet this would be true for an Android device or a Blackberry) is that the interface works the way you expect the interface to work on that platform. The web makes middling user interfaces at best -- a native app (for any platform) is simply going to be a better user experience.
This isn't even about the iPad -- it's about realizing that the 15 years we've spent using the web for everything has led to really crappy user interfaces, all bound to the HTML paradigm. I'm glad to finally see the web being eclipsed by actual applications and interfaces. This will happen on Android, Microsoft, Blackberry, and every new device that comes along.
If three months after this is released, and News Corp releases this for an Android tablet, will we be all saying how hip the Android users are because they can subscribe to the same content? Will it suddenly be cool?
Seriously, get over the whole iPad/Apple bashing thing, and recognize that tablets (of all forms) and the like are fundamentally changing the rules and the prevalence of everything being a frigging web page. You don't have to like the iPad, but you should recognize everything you've said will apply to all new touch screen devices as they come on line and available.
Personally, I don't see web pages going away, but I do see them not being the only way people get information or interact with software. This is just an example of that.
Seriously, dial back the bitching about this being about Apple, and start thinking about this in the broader context of what is going to be happening in the industry over the next bunch of years. Now that touch-screen technology is becoming prevalent, you will see this kind of thing on all platforms.