“They’re taking five billion dollars out of me and want to keep control,” Rupert Murdoch was saying into the phone, “in an industry in crisis! They can’t sell their company and still control it — that’s not how it works. I’m sorry!”
Time Magazine, June 28, 2007. Rupert Murdoch speaking about newspapers and his takeover offer for publisher Dow Jones & Co.
Further on in the same article:
When Murdoch talks about the future of newspapers, you get a sense of how contemporary he really is. Circulation and advertising revenues are ebbing away everywhere, he notes, proportional to broadband penetration. “You’ve really got to worry,” he says. “Tribune Co.’s revenues [in May] dropped 11% across broadcasting and newspapers. That’s huge. The Times dropped 8.5%. Half of men under 30 aren’t reading print newspapers, and there’s no sign that they come back as they age.”
How does he respond to this bleak picture? By musing about investing even more in newspapers. “What if, at the Journal, we spent $100 million a year hiring all the best business journalists in the world? Say 200 of them. And spent some money on establishing the brand but went global — a great, great newspaper with big, iconic names, outstanding writers, reporters, experts. And then you make it free, online only. No printing plants, no paper, no trucks. How long would it take for the advertising to come? It would be successful, it would work and you’d make … a little bit of money. Then again, the Journal and the Times make very little money now.”
Just as Rupert Murdoch ponders turning the newspaper model upside down, each newsagent ought to invest time in considering the appropriate model for their future. I talk here a bit about the newsagency of the future. I do this because as we can see with investments by our suppliers, that future, driven by change, is here now. Some newsagents are responding, many are not.
Rupert Mudoch tells us that the newspaper industry is in crisis. This is contrary to what newsagents hear at conferences from newspaper representatives. They are doing their job – keeping their distribution network together as long as possible. But no amount of spin can hide the crisis we face. Like any crisis, there are ways forward. This is what we have to concentrate on for ourselves.
Is Murdoch referring to newspapers im general or the markets overseas. I thought The Age has been reporting circulation growth in recent times.
Ted, The context is primarily US newspapers but he is CEO of a worldwide organisation and he knows that Time has worldwide distribution so I’d say it is fair to take the comments on board as having global context. I think that sales increases reported in Australia are inflated by promotions, loss leader subscription drives and co-op marketing with footy clubs and the like. mark
Interesting to see the crap being spun by Tony Kendall (CEO News Magazines – a subsiduary of News Corp.) at the ANF Convention.
The June issue of National Newsagent gives the indication that Tony went out of his way to ‘reassure’ newsagents that print media is still healthy. It even mentions him saying that Rupert Murdoch’s attempt to purchase the Wall Street Journal is an indication of the future of print media.
It just goes to show how blind the publishers think newsagents are. As a reflection on the industry as a whole, the scary thing is, im not sure that they are wrong.