The future of newspapers – ABC podcast

I recorded this interview with Glyn Greensmith of the ABC on the future of newspapers.

All you have to do is click and listen.

Compacts v Tabloids: The only game in town is the back page

As of yesterday [Monday 4 March 2013] we are in a weird scenario: Rupert Murdoch’s The Australian is the only broadsheet daily newspaper left in Australia. Think about this for a minute.

Yes, shocking, I know.

All of the other Australian dailies are tabloids. Or, if you prefer the Fairfax Media spin, most of the others are tabloids and two of them are ‘compacts.

The compacts are the former broadsheets: The Sydney Morning Herald and The Age (published in Melbourne).

The last broadsheet to tabloid conversion was when Brisbane’s Courier-Mail made the switch in 2005. Today the Courier-Mail is indistinguishable from its News Limited stablemates in Sydney, Melbourne and Adelaide. The Courier-Mail embraced the whole essence of becoming a tabloid. It has adopted the big double-deck headline technique with a large photo-splash and it has eagerly turned itself to tabloid news values as well.

But this is something that Fairfax Media says it won’t do; at least not yet. While it is clearly competing head-to-head with News Limited in Sydney and Melbourne, Fairfax honchos have said repeatedly–and whenever asked about it this week– that The Age and the SMH will not become tabloids, driven by celebrity, gossip and the sort of low-level moral-panic inducing campaigning journalism that characterises all the Murdoch mastheads.

Dear Media CEOs: stop meddling in our democracy

Dear media CEOs,

Thanks for your recent letter to Prime Minister Julia Gillard outlining concerns some of you have about regulation of the news media industry.

First a question regarding your views of a proposed “public interest test”: What are you afraid of?

Your letter suggests that any public interest requirement would be a “massive” increase in regulation. But your evidence for this is very slight and even misleading.

For example, you mention the Australian Communications and Media Authority (ACMA) rules on media ownership, but these do not apply to the print media. The Australian Competition and Consumer Commission’s (ACCC) powers and the Trade Practices Act are in place to protect the interests of news consumers, but they are not a protection of our rights as citizens.

The future of newspapers: Anybody’s guess at this stage

This post is a work in progress; I have published today [June 27] to get the ball rolling, I will be adding to this post over the next 72 hours.

On Monday 18 June the sky began falling in the Australian news media. Within 10 days the world of Australian journalism had changed forever, but the change hadn’t stopped.

Over 3000 jobs were going to be purged from Australia’s two largest news organisations.

The West Australian mining mogul, Gina Rinehart, was poised over Fairfax Media like a vulture over the corpse of a dying baby.

We all knew why she was there; it was just a matter of time.

That was the week that was (June 18-24)

What is the future of newspapers? At the end of a week in which both Fairfax Media and News Limited announced seismic changes to their business – including ditching about 3000 jobs between them – what can we say about the printed news sheet?

Well, it seems that the answer is ‘heaps and heaps’. Millions of words have been written, blogged and spoken on the future of newspapers this week; tens of thousands of them even appeared in the newspapers themselves.

So what do we really know at this point?

Not much more than we did last weekend, is my quick answer.

The ‘perfect storm’ that hit Fairfax Media this week — with Gina Rinehart at its epicentre — has been a long time coming. The Fairfax share price has been on a really steep down slide for the last two to three years.

Today it’s under 60 cents, just three months ago is was over 70 cents. The last time it was over $1.00 was June 2011; it dropped under $2.00 in November 2008. It was last at $3.00 in June 2008 and we have to go back nearly six years to December 2006 to see Fairfax at over $5.00.

In contrast the News Corporation share price on the ASX has jumped from $16 to $20 since June 2011. It has been over $15 for the past three years despite some ups and downs and has risen from a low of $12.91 on 23 June, 2009.

This shows that the problems facing Fairfax Media are commercial and financial, not just or even mostly technological.

These problems are not brand new either. It is not the Internet that has caused the total collapse of the newspaper business model; it has been a long time coming. It is instructive to go back and look at the history of the newspaper industry in Australia to understand why we are in the situation of having the Rupert Rinehart duopoly looming over the news media’s future.

Fairfax has a new model

In the middle of the second week of this perfect storm – June 27 to be precise – things did become a little clearer.

Three senior Fairfax editors had left the newsroom for the last time. It seems that there was a period of negotiation – one incoming new EiC (see org chart below) admitted he had been in discussion with management for about two weeks.

Still, many reporters were shocked and emotional scenes were reported.

News Limited announced around 100 job cuts, mainly in regional areas, including the Gold Coast and Fairfax unveiled a new newsroom model to staff.

The Fairfax model looks a bit like the broken ferris wheel here in Melbourne and I can’t help wondering why some of the content wedges are bigger than others. Is it because they will get more attention in the new system of content brokerage across neutral platforms?

If it is then going ‘compact’, or ‘tabloid’ is about more than just the size of the page.

The Fairfax ferris wheel.
Click to enlarge

The new Fairfax organisational chart is also worth taking a look at.

It’s not that different from a traditional newsroom structure in many ways, but the convoluted explanations of roles and responsibilities that accompany it are straight from a weak MBA dissertation.

Fairfax Org Chart: designed by a poor MBA student?
Click to enlarge

In this model reporters who are covering breaking news are to be known as ‘first responders’, this gives the whole thing the feeling of a medical emergency.

And that’s what this is. It is an attempt to triage a series of seriously wounded patients on a bloodied battlefield.

The Fairfax mantra of journalism and integrity come first is pleasant soothing language that will hopefully comfort the afflicted, but when you rip the heart out of a newsroom no amount of placatory talking can alter the facts.

Then there’s the hovering vulture and her cronies.

In a statement released on 27 June, Rinehart’s advisers conceded that she might be prepared to negotiate and sign a new Charter of Editorial Independence, but this ominous set of phrases is where the really alarming detail bedevils:

“Active consideration of content or a change in content is required to attract readers and advertising revenue in the interests of shareholders, together with other options to increase revenue and hence share value.”

What does this mean?

Well, it can really only mean one thing: shifting the Fairfax editorial culture. But which way will it be shifted?

Most money is on the bet that Gina Rinehart will want to shift Fairfax to the right and into more ‘business-friendly’ reporting. This is assumed to include more climate change ‘scepticism’ and less criticism of the minerals industry.

However, it is questionable as to whether this will attract readers, increase advertising or enhance shareholder value.

It may well have the opposite effect as current readers of the SMH and The Age desert the papers in direct proportion to their rightward drift.

If this happens and the new tabloid-ified Fairfax mastheads begin competing with the Murdoch titles then the next logical step – to maximise shareholder value, mind – would be to merge the titles in Melbourne and Sydney and turn them into one-paper towns in line with the rest of the country.

That is the logic of shareholder value maximisation – or in blunt Marxist terms it is the application of the logic of capital accumulation.

It is also the history of the Australian newspaper industry.

In 1886 – just 128 years ago – there were capital city 48 daily newspapers in Australia. By 1903 that had dropped to 21; it was down to 17 in 1947, 15 in 1950, 14 in 1960 and it has continued to drop since. From the mid 1990s on the present situation became established.

Today there are 11 capital city dailies: two in Melbourne; two in Sydney; one each in Canberra, Adelaide, Hobart, Perth and Darwin and two that circulate nationally.

That is why questions of concentration, ownership and diversity are being talked about again in the context of both the Finkelstein report and the Rinehart push for editorial control at Fairfax.

The giant media fuss about Finkelstein and the frenzied cries of censorship and government control prompted me to look at the last government report into the news media, delivered to the House of Representatives in 1992. [I’ll come back to this].

 

News & Fair Facts

Just over 20 years ago, in March 1992, a House of Representatives Select Committee tabled its report into the Australian print media industry. It is worth looking at this report because it had bipartisan support and its findings make it clear that the issues that free speech alarmists are shouting about today have deep roots.

It is also interesting because the free speech alarmists — those who argue that government censorship is coming in the form of the Finkelstein report — would deny some of the language used in News & Fair Facts, particularly about the problems of monopoly and the concentration of media ownership.

For example:

On the basis [of figures given to the committee], the Australian print media industry generally is highly concentrated. In almost every sector of the industry one or two groups dominate in terms of the number of publications and related circulation under their control.

News & Fair Facts, 1992, p.101

Now the Rupert Rinehart apologists deny that monopoly is a problem.

Miss us this day our daily newspaper? Where will the cuts come first

The hares are running on the proposition that the Fairfax Media board is considering a medium-term plan to give up on printed Monday to Friday editions of its main mastheads in favour of a digital-only strategy.

And while we’ve all been looking the other way, News Limited has quietly downsized newsrooms and subs benches at several of its titles, including the Geelong Advertiser and the company has outsourced some backroom functions.

The newspaper industry is quietly dying.

But will it matter to most of us? Avid readers will miss the pleasure of print, but the news will still be available in other formats.

It is fears about the dwindling bottom line that is driving talk of abandoning daily newspapers at Fairfax and the paywall strategy at News Limited. We can perhaps get an idea of the future from looking at recent events in the United States.

Closures, shuttering and digital only “newspapers”

At least 13 large US newspapers have closed since 2007 and 10 or more have cut back two or three editions a week, instead of publishing every day.

The argument is that by eliminating high-cost low-return editions the more profitable days can be continued and the newspaper brand survives.

Murdoch’s UK paywall – set to change the world of online news

Rupert Murdoch could never be accused of stupidity. Rash behaviour at times, certainly, but he’s ruthlessly smart and totally focused on the bottom line.

In a few weeks time Murdoch’s most valuable (in terms of reputation and cache, if not profitability) media assets in the UK will disappear behind a paywall.

The Times and The Sunday Times will cost you real money from some time in June 2010. Already if you want to check-out the still free content you have to sign-up to go past the front page.

Next time you visit The Times, take a moment to register...have your credit card handy too.

Paywalls are controversial; supporters argue that without significant injection of subscriber funds there will be no more quality journalism, while detractors say that paywalls are anathema to the very ethos of the Internet.

One critic, Future magazine’s CEO Stevie Spring says she wishes Murdoch well, but remains unconvinced that the paywall experiment can work:

“Perishable news – like that News Corporation is talking about, for instance – is ubiquitous,” she said. “The basic rules of marketing say people will substitute and not pay for what they can get free. Good luck to them, I really hope it works but all the norms of marketing say it won’t. [However] it is an experiment they can afford to make.” [guardian.co.uk]

Roy Greenslade also puts the strategy under the financial spotlight, pointing out that subscriber numbers would have to jump exponentially to cover the costs of the newspapers’ £100 million editorial budget:

If 100,000 people agreed to pay £2 a week for access to the papers, it would result in annual revenue of £10m. It’s a sobering thought that the sum is but a tenth of the papers’ editorial budget and less than an eighth of their current joint annual losses. [Greenslade blog]

Global news meltdown and Kiwi exceptionalism

I’ve just come in from the New Zealand Writers and Readers’ Festival. I was on a panel this afternoon with Rhonda Sherman of the New Yorker and Pamele Stirling, editor of The Listener. The chair was Nicola Legat and the crowd was great. I reckon about 300 people; which was more than I’d expected. So, if you were there, “thanks for coming”.

And, if you were there and you want to take up my offer for “citizen journalism” training or would like to help kick-off the “Let’s buy the Herald” coffers with a donation, get in touch.

The session was billed as the “publishing revolution”:

Want to know more about how the publishing industry works? Get the inside word on the pitfalls, peaks and politics of journalism and publishing from leaders in their field. The New Yorker’s Rhonda Sherman, New Zealand Listener editor Pamela Stirling, and AUT Associate Professor of Journalism Martin Hirst sift through the silt of the last decade, and look ahead to the impact of the global economic melt-down and digital age on publishing in the next. Chair: Random House Publisher Nicola Legat. [Progamme note]

Really, given there was a panel of four journalists, it was about the future of the news industry, particularly newspapers and magazines, and therefore, also the future of journalism.