There were reports last week that News Limited would announce details of a restructure today. Over the weekend the timing was said by News reps to be off. Either way, cuts are coming – on the back of a number of cuts to News businesses in Australia last week. And on the back of cuts announced within Fairfax last week.
These moves are relevant to newsagents who are facing uncertainty of a different kind – what the structure of newspaper home delivery will look like under new contracts soon to be presented by News Limited.
Footnote: It is fascinating watching how Fairfax and News report on each other and that objectivity takes a back seat.
Our rep told us on Friday that News Ltd will make a major announcement to all newsagents on 28th June. It seems the announcement will include forced amalgamation of territories.
Unless Fairfax jump in the boat with News I can not see how they will be able to force territories to combine. If the Agent next to me was to only loose his News deliveries how would that be viable for the other agent without Fairfax?
Or am I missing something something that would make you want the news runs?
As I dont see that happening.
I spoke with my sydney metro rep recently who advised that it would start with voluntary amalgamations – by newsagents handing back unprofitable territories. Not sure how accurate this is, or how ‘cluey’ my rep is – but I am not loosing sleep over it.
The publishers will incentivise us to merge runs by significantly increasing delivery fees, on the basis of reaching predefined subscription targets.
This business could have some life in it, yet !
Wednesday night here I’m at home, tea over, evening news finished ……….. where or what is this announcement ????
h, Kim Williams has announced that it it will be two or more weeks away.
News Ltd will announce on 28 June what conditions you need to meet to have your contract renewed in 12 months time.
The changes in Queensland will be more immediate and more drastic than in other states, as the problems there are worse than in other states. I think change will be forced on Queensland newsagents soon, whereas other states will be given 1 year to voluntarily meet the criteria, with those who don’t having change forced on them.
Basically, they are looking for larger territories run as separate entities and operations to any retail business. This means for example a suburban newsagent running their territory out the back of the shop won’t meet the criteria.
For those newsagents who don’t act and meet the criteria, then you may lose your territory.
For Victorian newsagents, go to one of the VANA meetings currently being held and also have a look at the VANA website, there is heaps of valuable information.
If thats the case then 99% of newsagents will have their run taken off them, and in most country areas home delivery will cease to exist.
Dean how do you know all this ?
Shayne i would have to agree
Shaun,
This is what was presented at the VANA meeting this week.
Shayne,
I think that QLD territories will be re-jigged with the view to making them profitable. I think there may be some pain in the short term in QLD though. The situation in the other states is very different to QLD and so the change will be less drastic, however any newsagents who don’t adapt to the changes which are coming will lose out.
The announcement on 28 June from New Ltd will give details.
Actually the decison is deferred because it is not as important as other issues facing senior management at News Ltd.
There papers are getting delivered as they always have been. They know they have to do something but they’re not under pressure.
They have more important issues to deal with; editorial, marketing, media sales, shareholder returns etc etc. Circulation is the area that currently requires the least attention in the newspaper management lexicon.
But don’t worry they will get around to it. So lets just all keep calm and carry on.
Hey Dean
What VANA meeting were you at? That didn’t come through at the one we attended.
There was no value add at all. They either proffered what can only be described as conjecture, or regurgitated stuff that we already knew.
Then, as usual, they turned it into a roadshow promoting their own businesses.
VANA really needs to decide whether it wants to be marketing group, or an industry representative body. Currently it only does half a job of either.
Right now the industry needs EFFECTIVE leadership. VANA is not coping with our needs. Circulation and distribution are not front of mind for top management on the publisher side.
Really, we know so many people who are questioning the role of VANA and the continuity of their own membership. They could have a membership crisis on their hands if they don’t lift their game.
Realist,
You must have gone to a different VANA meeting than I went to. I checked the presentation that was emailed to people who attended, and can’t see anything wrong with what I said.
While yes they did push some VANA products, the major announcement coming on 28 June was clearly mentioned a number of times, along with an indication of what newsagents need to do.
As for VANA’s performance, 2 year’s ago I nearly didn’t renew. Last year I had made the decision not to renew and only relented because there was a change in management and I thought I would give them another chance. I think their performance in the last year has been better than prior to that, but acknowledge that more improvement is needed. I say this because I don’t want you to think I am a VANA lover.
I do disagree with your comments that circulation is not top of mind. I know for a fact that VANA has spent a lot of resources over the last 12 months working on the T2020 project, but have been hamstrung by News and Fairfax’s non-engagement on the subject.
isn’t the 8th of august the new date or am i dreaming ?
August 9 is the day AFAIK
Tomorrow @ 10am.
They’ve visited those of us it’s effecting in the first roll out in Brisbane earlier in the week and given us an overview of whats happening. The very fine detail is all thats to be disclosed but we basically know all the we need to know.
For me definately and interesting change and will certainly mean going forward I have much less emphasis on newspapers. They will still be one component of the business but a very minor one (not perhaps that they weren’t before hand ?).
The changes seem quite positive in some ways, such as size of the delivery territories. Where I am I think it was amalgamating 14 other territories so it should make it quite viable for whoever decides to take it on. There was also talk of a handover payment if you assist and comply with the hand over of the territory and the run details to the new distribution area owner. No note yet though on the amount of it.
On a negative side I’m certain it will kill off smaller or medium sized agencies who currently rely on their run for a sizeable portion of their income and are unable to, or are unsuccessful in tendering for the new larger territory.
Personally, I’m now looking forward to an extra hours sleep in on a Saturday instead of doing inserts for Coles and a few extra minutes on Sundays and weekdays when I don’t have to deliver their papers across to them. 🙂
good luck to those effected, I think you are going to need it.
We’re looking forward to it and are feeling very frustrated that it’s taken so long for News Ltd to get around to doing whats “bleeding obvious”.
The model looks sound to me and the principles News is pursuing good for the health of involved newsagents.
I think it depends upon what you mean there Mark by “involved” agents. I have no doubt that while it isn’t intended to do so, it will force some to rethink the viability of their business or discover it the hard way. The other side to that of course is whether their retail business was infact truely viable if it hinged solely on newspapers. Those of us that don’t rely on print sales will probably be better off with the extra time and effort spent in other areas of our stores (No more having to reconcile QNP paper invoices with delivery schemes – yay !! ) .
I suppose the next question is going to be how long the distribution businesses in their new form will remain viable and if they are going to have a finite date for how long they will remain so for those willing to put the capital into tendering for one now ?
Paul this rethink will occur … probably a few years too late.
10,000 News Ltd newspapers per day for a territory. Wow!
Country –
I will add my 10-20 paper deliveries to your 10-20 papers and we will still not be anywhere near 10,000 !!!!!!!!!!
nothing we didnt already know, the key will be in the dist maps when they are released. Business as usual til next year sometime.
Im the only newsagent in town, so not sure how that will pan out, but will see what happens I guess.
rick, I think they think you are going to drive to the nearest 10,000 papers a day “hub” to collect the papers for your town. At least, that’s what I understand.
there really isnt much info for us regional newsagencies…… for me, i would assume the 10’000 a day area would be accross about 6 federal electorates.
all i have today is more questions than I did yesterday
Exactly right Peter. No point even thinking about it until some real information comes through. Todays announcement says nothing.