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Media disruption

The Border Watch and associated newspapers to close tomorrow

The Border Watch, a regional newspaper in South Australia, along with sister pub locations, will close tomorrow. Here is the full announcement put on Facebook:

TBW PRESSES COME TO HALT
For 159 years The Border Watch Newsgroup has been the voice of the Mount Gambier and district community, so much so it became known as the “Community Watchdog”. During those 159 years it fought to protect society against any wrong doing and look after the interests of its readers and local community.
It has always remained proudly locally-owned by firstly, the Laurie and Watson families and since 1977 it has been owned by the Scott family.
It has also had the distinction of operating for 159 years without missing an edition – that will no longer be the case.
Sadly, today, the Board of Directors of The Border Watch Pty Ltd, which includes The Border Watch, South Eastern Times (Millicent) and The Pennant (Penola) announce that these newspapers, along with Millicent Print and the company’s associated digital platforms will cease production as of Friday, August 21.
The 38 staff employed by the company were told of the decision today.
They will receive all redundancy, annual and long service entitlements.
Like regional newspapers in the United States and Europe over recent years Australia’s regional newspaper network has struggled in the past few years with many down-sizing or closing.
The Border Watch Board of Directors said every effort had been made to keep the presses running.
“As currently experienced throughout the regional media industry the recent impact of the COVID-19 pandemic has significantly worsened the financial viability of TBW that was already severely impacted by declining advertising revenues and newspaper sales as well as increasing competition from a variety of digital media platforms.
“Taking these issues into consideration TBW has made the very difficult decision to close its operations.
“The company employs 38 staff and their loyalty during some difficult times in the past year is of the highest order and directors paid tribute to these talented, hard-working and in many cases, long-serving members of The Border Watch family.
“To our loyal readers and advertisers we say a big thank for your support over many years.
“Finally to our loyal and dedicated staff who have given so much to this company and its various media operations over so many years, we say a big thank you and our hearts go out to them and their families during this difficult time.
“Today is a sad day for everyone.”

Reading this, I am reminded that the Seattle Post Intelligencer moved to digital only in 2009. I wrote about it at the time. They made the move ahead of the curve and repositioned the business ahead of the major hit of disruption. Publishers confronting disruption now are coming at it late and have fewer options because of this.

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Media disruption

North Central Review newspaper to pause print for a week

This notice from the publisher of the North Central Review yesterday speaks to the challenges faced by independent local newspapers as a result of Covid. Their explanation of the situation is well made:

No print edition next week

The North Central Review, The Free Press and the Whittlesea Review will not print newspapers next week, on August 25, 2020.

The Review is taking the opportunity during the second COVID-19 lockdown to close for one week.

Normal print editions will resume Tuesday, September 1.

General manager/editor Lauren Duffy apologised for any inconvenience caused to advertisers and readers.

“The COVID-19 pandemic is affecting all small businesses, and we are no exception,” she said.

“We have weathered the storm so far this year and printed as normal in 2020.

“Advertising from local business has significantly dropped and we feel we need to take this step.

“We thank you those local businesses who do advertise with us for their support thus far in 2020, and hope this continues in the future.”

Newspapers and media organisations across Australia have been significantly affected by a downturn of advertising revenue, with many newspapers forced to close their doors.

“While we provide an essential service to many people because in many communities we are the only local news service, we are also a business – we employ more than 15 local people, plus many, many more to deliver our newspapers, and we have costs like all businesses have,” Ms Duffy said.

“We are trying our very best to ensure the longevity of this newspaper.”

The Review’s journalists will continue to publish news online here at www.ncreview.com.au to keep the community updated with essential news.

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Media disruption

News Corp Q4 results

News Corp has just released its fourth quarter and full results. For the Australian and newspaper part of the business for Q4:

Within the segment, revenues at News Corp Australia and News UK declined 31% and 22%, respectively. Adjusted Revenues for the segment decreased 22% compared to the prior year.

Circulation and subscription revenues decreased $22 million, or 9%, compared to the prior year, which includes a $10 million, or 4%, negative impact from foreign currency fluctuations. The remainder of the decrease was driven by lower single-copy sales revenue, primarily at News UK, as a result of COVID-19, partially offset by digital subscriber growth and price increases.

And, for the full year:

Within the segment, revenues at News Corp Australia and News UK declined 16% and 13%, respectively. Adjusted Revenues for the segment declined 10% compared to the prior year.

There is also this re COVID-19:

News Media: We have seen, and expect to continue to see, adverse effects on advertising and single-copy sales revenues. Advertising revenues in July at the newspaper mastheads declined 25-30% in total compared to the prior year. As a reminder, advertising revenues in the prior year included results from News America Marketing and the suspended community titles in Australia. The overall decline in circulation volumes moderated in July from the lows experienced in April and May, particularly for the weekend papers. We continued to see strong growth in digital subscribers in July compared to the prior year at the Australian mastheads and at The Times and Sunday Times.

The Company continues to take various steps intended to offset the impact of COVID-19, including by reducing variable costs and implementing cost-savings initiatives across its businesses, with a particular focus on the News Media segment. For example, the Company is implementing a shared services program to centralize a number of functional areas. While it is still evaluating the cost savings opportunity from this program, the Company expects to recognize annualized cost savings of at least $100 million beginning in fiscal 2022.

The ultimate impact of the COVID-19 pandemic, including the extent of adverse impacts on the Company’s business, results of operations and financial condition, is highly uncertain and cannot be predicted.

The figures have just dropped. there is sure to be plenty of analysis, especially by competitor outlets.

In terms of COVID-19 it is interesting to see their commentary about their own business and to reflect on this in the context of their shrill and changing commentary which is often shouted at the public. If only their reporting and ‘news’ stories were as reflective and considered as what they write about themselves.

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Media disruption

Reuters: Rupert Murdoch’s big investment headache: Australia

This report by Byron Kaye, Rupert Murdoch’s big investment headache: Australia, which dropped at Reuters yesterday makes for a fascinating read.

SYDNEY (Reuters) – The birthplace of Rupert Murdoch’s media empire, News Corp’s (NWSA.O) Australian business, is shaping up as a trouble spot for the global firm, following a billion dollar writedown and a move to stop printing more than 100 regional newspapers.

People interested in print media in Australia should find the article interesting regardless of your views of the Murdoch controlled company. The report has been widely shared on Twitter since its release yesterday. Here are some of the tweets where a link to the article was shared:

  • News Australia dinosaur drag on whole company…Reuters.
  • analysis of why the short sellers are moving in on the Murdoch empire. #auspol
  • Newscorp the most shorted stock in Aust says Reuters. “Rupert Murdoch‘s big investment headache: Australia”
  • “I’ve had a view it’s worth nothing for a long time.” Death rattle.

Yesterday, Crikey published a report by Christopher Warren on the closure by News Corp of a printing plant in Queensland. This, too, is worth a read.

As News Corp closes down more printing presses, it threatens to lock out new players.

Australia’s press took a big step this week in its decades-long journey from venerable manufacturing process to nostalgic metaphor with the accelerated closure of those production plants where newspapers are — or were — printed.

The resulting consolidation will see News Corp making a further change, reducing the size of its metropolitan papers to the shorter size technically-known as the “bastard measure”, beginning with The Courier-Mail.

…

The Yandina press will use a single press to print the company’s remaining south-east Queensland papers — The Courier-Mail and Sunday Mail, the Gold Coast Bulletin and the Toowoomba Chronicle. It will also print local copies of The Australian, The Daily Telegraph and Nine’s The Australian Financial Review.

There’s form here that will concern independent publishers. When Horton Media, Queensland’s last independent printer, closed two years ago, some small independent papers had to shift printing to Sydney and truck their copies to the state due to local capacity constraints. Fairfax’s print plant at Ormiston (and in NSW’s Hunter), closed the same year as part of a printing and distribution agreement with News Corp.

This is all part of the disruption. newsagents, as we have seen in recent weeks, will get caught in the changes, left without papers, left dealing with angry customers. Communication from News Corp has been and continues to be appalling. It is a selfish company with a history of bullying small business newsagents. Top be fair though, plenty of newsagents have willingly made themselves available for this.

From the perspective democracy, we have to hope that there are more genuinely independent news outlets and that they have more journalists asking tough questions of politicians from all sides. The current concentration of news outlets in Australia is unhealthy for democracy. You only have to look at the biased Daily Telegraph.

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Ethics

Bauer CEO on Covid and the sale of the business

Mumbrella yesterday published an interview with Brendan Hill, CEO of Bauer Media. It’s an interesting read. From the newsagency channel’s perspective:

And subscriptions have been growing amazingly through this period. And you can’t forget that because we’ve got print products, we’re an FMCG product as well, and our sales in supermarkets and newsagents have been excellent through this period as well.

I’m very bullish about the future. But then again, who knows, with COVID how long it’s going to carry on for, what long-term impacts it’s going to have. We’ve got to take it as it comes. But at the moment, there are some greenshoots out there.

The place of magazines in any retail situation is a consideration as we now see that magazines sales, overall, have snapped back. That is, the increased through March and April flattened early May and by the end of the month they were in line with the longer term trajectory – not for all titles but for the majority.

This, with flat cover prices and a mediocre margin makes magazines a category of focus for any retailer. This is the challenge retailers will watch as the new owners of Bauer complete the transaction and settle in.

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magazines

Surprise, surprise: Bauer Media to be acquired by Mercury Capital

It turns out the speculation months ago was right. Bauer media is being sold to Mercury Capital – subject to government approval.  Here is the Bauer press release:

BAUER AUSTRALIA MARKS NEW CHAPTER UNDER NEW OWNERSHIP

Sydney, 17 June, 2020: Bauer Media Group today announced the sale of its Australian publishing business to investment firm Mercury Capital, marking a new chapter for Bauer Australia after its acquisition of Pacific Magazines in April.

The binding offer from Mercury Capital involves all of Bauer Media Australia’s titles from across the Women’s Entertainment & Lifestyle; Fashion, Beauty & Health; Homes; Food; Motoring & Trader lifestyle categories. The agreement also includes those titles recently acquired by Bauer from Pacific Magazines, as well as Bauer’s New Zealand mastheads.

Veit Dengler, Bauer Media Group COO said: “We have been proud to be the custodian of these iconic titles in Australia. I am confident that under Mercury’s ownership they will continue to thrive.”

Brendon Hill, Bauer Media ANZ CEO, says: “This signals an exciting new chapter for the business. With new ownership and our bolstered portfolio, we have unparalleled opportunities to connect with more Australians than ever before and continue our strategy of digital growth and innovation.

“We have increased flexibility to diversify revenue streams and grow and innovate across our multi-platform offerings. Additionally, we are well placed to invest in the key drivers of future success – high-quality content and digital development which is good for us, our audiences, clients and the Australian industry as a whole.”

Bauer’s expanded portfolio of 43 brands now reaches six in ten Australian women each month; more than 6.5 million women each month across magazines, websites, video, social, customer review sites, podcasts and experiences; a print readership of 6.8 million per year and social connections of more than 30.5 million.

“Despite the challenges presented by COVID-19, we have seen significant growth in subscriptions and digital audiences across our food, home, youth and fashion brands, demonstrating that Australians still love and read our brands. We have seen great vision, success and growth under Bauer Media Group ownership and now look forward to working alongside Mercury Capital to build on this growth under a new brand in the future,”Hill says.

The sale is subject to regulatory approval with the transaction expected to be complete in mid-July and the new brand to be announced in the coming months.

ENDS

The question will be: what does this mean? The folks at Bauer will say it is business as usual. I get that. However, it is never business as usual after any acquisition. Businesses are sold for a reason just as they are bought for a reason. Change is inevitable.

While I have no inside knowledge, looking at sales, ad revenue challenges, print media challenges and other factors, I expect we will see changes to the title mix, editorial focus and distribution arrangements.

Mercury Capital is a private equity business. Their objective is to get a return on their investment. Their actions with the business will depend on the timeframe over which they want to achieve the desired return. I say that as cost cutting focusses on shorter term return whereas investing in the actual products is riskier and would take longer to achieve a return.

Even though the reported purchase price of $50M (or less) is bargain basement, driving a return in this market (Covid or not) presents challenges.

Regardless of what Mercury does with the business, Australia’s largest magazine publisher has more disruption ahead and that will ensure disruption for all of us involved in magazine distribution and sales.

Whereas years ago, magazines were a core traffic driver for newsagency businesses, today the category is nice to have but not core. Many newsagents have transitioned focus to other more commercially valuable product categories.

25% gross profit is low for businesses confronted by annual rent and labour cost rises. 25% gross profit for products with suppressed retail prices makes magazines even less appealing. I think this is a reason we are seeing major retailers less interested in the category.

Let’s see what happens. Change, however, is inevitable.

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magazines

Crikey: Why the ACCC needs to step in and stop News Corp’s regional closures

Eric Beecher, Chairman of Crikey’s publisher, Private Media, makes an excellent argument on ACCC engagement re the News Corp closures of 100+ local newspapers:

Why the ACCC needs to step in and stop News Corp’s regional closures
When the journalists at News Corp saw reports that Lachlan Murdoch had acquired a new family home in Los Angeles for $218 million last December, they might have felt a sense of career security that comes from working for a highly profitable company with an overtly prosperous controlling shareholder.

No longer. Over the past few weeks, News Corp has announced the closure  of 125 regional newspapers, the elimination of a quarter of Australia’s print dailies, the shuttering of most of this country’s suburban newspapers, and the retrenchment of hundreds of staff across its city newspapers.

The decision to decimate a large slice of Australia’s regional and suburban journalism wasn’t made in rural hamlets like Chinchilla or Caboolture, or suburbs like Parramatta or Preston, where local news coverage will either disappear or be scaled right back.

It was announced from corporate head office in Sydney, where the company website proclaims its pride in “our heritage of connecting communities to the stories that matter … we are the voice of everyday people, a champion for the battlers of Australia”.

That spin was also embedded in the company’s announcement of its 125 newspaper closures.

“Let me be clear from the outset: News Corp is not turning its back on Australia’s regions and communities,” wrote executive chairman Michael Miller in the company mouthpiece The Australian. “Nothing could be further from the truth: we remain their greatest advocate — they are what makes our country great.”

The script for Miller’s ritual commitment to altruistic public service journalism was initiated decades ago in Sir Keith Murdoch’s will. Dated January 21 1948, it laid out his expectation that his son Rupert “should continue to express ideals of newspaper and broadcasting activities in the service of others and these ideals should be pursued with deep interest”.

Those grand ideals sit in stark contrast to the announced closure last month of those (mainly free) newspapers which will be replaced by vastly scaled-down, paywalled websites employing hundreds’ fewer journalists across regional and suburban Australia.

If public interest journalism was just another product, especially in regions and suburbs where there is only one publisher of a “product” that is central to a democratic informed society, it could be argued that acting purely commercially — as News Corp has done — is entirely appropriate in a free marketplace.

But not all products are equal. If the Australian Competition and Consumer Commission, the corporate regulator, really believes what it says about news journalism — that it’s a “public good, important for democracy” — why hasn’t it intervened in the culling of Australian community journalism at the hands of News Corp, a $10.3 billion foreign-owned media company?

Why hasn’t it stepped in, as it did recently when major shareholders News Corp and Nine Entertainment announced the closure of Australian Associated Press, the country’s only wire service? In that case, the ACCC launched an inquiry that effectively put the owners on notice that it wouldn’t countenance AAP being shut down if there was a legitimate buyer. As there was.

With a few weeks to go before their closure, it isn’t too late for the ACCC to repeat that intervention and launch an investigation to determine whether there are genuine buyers for at least some of the newspapers being shuttered by News Corp.

This strangulation of Australian local news is laced with sadness and irony. It sees the arc of a media journey — beginning with Rupert Murdoch’s inheritance of the now-defunct Adelaide News from his father’s estate in 1952 — reach its denouement in the uncertain hands of his son, Lachlan.

Without swift regulatory intervention, that journey will end up a long way from the “ideals of newspaper and broadcasting activities in the service of others” that Keith Murdoch optimistically predetermined for his own son.

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Media disruption

Two regional newspapers close for good in Victoria

The Great Southern Star and Yarram Standard suspended print production in March as the coronavirus pandemic was ramping up. The publisher has now confirmed that the closure is permanent. The Age has the story.

Closure of independent local papers highlights the struggle for all media – locally-owned and multinational – as the pandemic eats away at the remaining advertising not yet lost to digital giants like Google and Facebook.

The Star, established in Leongatha in 1890, had a weekly print run of about 4300; the Standard at Yarram near the Ninety Mile Beach, about 1600.

Mr Giles said his family had been torn over the decision to close and the impact on communities.

“I understand towns are probably fearful of losing their identity,” he said. “The main people I’m concerned for are the 60-plus seniors who love their paper.”

Mr Giles said among the body blows to local papers was the leakage of revenue to social media. “I’ve been trying to tell local businesses that [Facebook CEO] Mark Zuckerberg is taking all our profits over to America.”

While I get that publishers see value in targeting Google, Facebook and other social media platforms for loss of revenue, the reality is that what has happened is the world has changed. How people engage with news has changed. We have all seen it coming for many years.

I am surprised there have not been more newspaper closures sooner.

I agree there is an issue with the tax paid by these giant offshore social media companies, and, indeed, many large businesses. They scam us raking in billions from Australians paying little in tax, making almost no economic contribution to government funded infrastructure.

There is also an issue of shop local. Advertisers have fled print to these social media platforms. I know I did ten years ago because of the more efficient ad model. Everyone on Facebook and Twitter, everyone searching Gooogle for news and clicking on a paid ad has put a brick in this wall.

News itself has fuelled the change. Whereas in the past, stories would break in print. Now, they break within seconds of happening and become fanned quickly beyond local thanks to the digital platforms.

The medium is dead. Okay, for some, the print newspaper is something they like. However, there are not enough of them to fund the infrastructure to keep print alive. All that is up for debate right now timing of to closure of print newspapers. Okay, maybe not all because analysis and investigative journalism newspapers like The Saturday Paper could exist for ages.

Yes, it is sad local papers are closing. We knew this would happen. Their closure does not need to mean an end to local news, it does not need to mean the end of a local newsagency that is part of a channel created to distribute news.

It is now up to locals who want a local voice for local news and opinion make that happen. A newspaper publisher closing does not mean the need is gone. Those calling for the need for a local newspaper should look at what they are doing and the choices they have made and can make now to support a local voice platform for 2020 and beyond.

Newsagents can play a role in this.

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Media disruption

News Corp. announces newspaper closures and redundancies

Here is the full announcement from News Corp this morning about newspaper closures and redundancies:

The Executive Chairman of News Corp Australasia, Mr Michael Miller, today announced significant changes to News Corp Australia’s publishing portfolio.

Mr Miller said that over recent months News Corp had undertaken a comprehensive review of its regional and community newspapers. This review considered the ongoing consumer shift to reading and subscribing to news online, and the acceleration of businesses using digital advertising.

“COVID-19 has impacted the sustainability of community and regional publishing. Despite the audiences of News Corp’s digital mastheads growing more than 60 per cent as Australians turned to trusted media sources during the peak of the recent COVID-19 lockdowns, print advertising spending which contributes the majority of our revenues, has accelerated its decline,” Mr Miller said.

“Consequently, to meet these changing trends, we are reshaping News Corp Australia to focus on where consumers and businesses are moving and to strengthen our position as Australia’s leading digital news media company. This will involve employing more digital only journalists and making investments in digital advertising and marketing solutions for our partners.”

Mr Miller said News Corp’s portfolio review highlighted that many of our print mastheads were challenged, and the double impact of COVID-19 and the tech platforms not remunerating the local publisher whose content they profit from, had, unfortunately, made them unsustainable publications.

He said the portfolio changes being implemented would mean that from Monday June 29 the bulk of News Corp’s regional and community titles would move to purely digital publishing.

“More than 375 journalists will be specifically covering regional and community news and information. They will continue to serve, and live in, their local communities with the majority in regional Queensland where we have most of our titles,” Mr Miller said.

“More than 640,000 Australians, our latest figures show, are currently subscribing to News Corp’s digital news content and subscriptions are growing at an annual rate of 24 per cent.

“Much of this growth is from local news, where subscribers have more than doubled in the past year. In regional Queensland more than 80,000 people have digital subscriptions and this number has grown by more than 40 per cent this year.

“I’m confident that these numbers will accelerate through dedicated and constant digital publishing and continuing to serve the local communities whose trust and community commitment the mastheads have developed over decades.

“Over the past 19 months News has launched 16 new digital only local mastheads. In total we will now publish 92 digital only regional and community mastheads, each offering readers rolling coverage, electronic alerts and newsletters, richer audio and video content and deeper local sport coverage and community debate.

“At the same time, News Corp’s major mastheads in Brisbane, Sydney, Melbourne and Adelaide – The Courier-Mail, The Daily Telegraph, the Herald Sun and The Advertiser – will now become more state focused with increased regional content and will partner with our regional and community local titles in their states to ensure we deliver compelling journalism to Australian consumers regardless of where they live. Subscribers wherever they live will now have access to the best of News Corp’s local, regional, state, national and international news, sport, features and columnists.”

Describing the changes being announced today, Mr Miller said: “These initiatives are significant. They will involve fundamental changes to how we operate our business but they are necessary. Together with senior executive and editorial appointments announced recently, they will enable us to be more effective in driving further success in the growth areas News Corp is excelling in such as digital advertising products, solutions and subscriptions and will embed a more collaborative way of working to maximise our sport and news coverage, hyper local digital subscriptions and the success of our all-important weekend editions.”

Today’s announcements to News Corp’s publishing portfolio will mean some job roles will change and regretfully, will lead to job losses. Mr Miller said that for those employees impacted by the changes, he wanted to thank them personally for their professionalism, dedication and contribution.

“They have provided News with invaluable years of service. Their passionate commitment to the communities in which they live and work and their role in ensuring these have been informed and served by trusted local media has been substantial,” he said.

Commercially, these portfolio changes will make News less complex for its partners to leverage and will build on the innovations it already has in place. This includes:

● News Xtend which is now Australia’s top digital marketing agency for small and medium enterprises;

● News Connect data platform which ensures businesses reach the right consumer segments wanting to pay for their products and services through its specialist ability to access two billion consumption signals from 12 million Australians;

● Australia’s number one digital publisher for news, real estate, business, sport and fantasy sport, food, fashion, health and beauty, parenting and women’s lifestyle;

● Digital powerhouse news.com.au which has increased its audience more than 30 per cent in the past two months to more than 12.2 million monthly users;

● A leader in audio and video with News’ data now showing award-winning podcast downloads of more than five million monthly and digital video views topping 100 million monthly, up 45 per cent in a year;

● Monday’s launch of BINGE entertainment streaming service which joins Foxtel and the Kayo sport streaming service as the nation’s premium subscription broadcasters;

● REA Group which is Australia’s clear leader for real estate digital services and investing in Asia and the United States, through its 20 per cent stake in Move, Inc.

In conclusion, Mr Miller said: “News Corp remains committed to Australia’s regions and communities and the initiatives we are implementing today represent a detailed, considered strategy to ensure we will better serve our journalism to Australians who live outside its major cities.

“News Corp and its employees also will retain at their creative core their passion for championing, and advocating for an ever improving Australia. As our country emerges in coming weeks from the lockdown enforced on us by the threat of COVID-19 into a ‘new normal’, we will ensure these values that separate News Corp from other media companies are even stronger than ever.”

Consequently, News Corp Australia is announcing today that:

Our major regional titles – The Hobart Mercury, NT News, Cairns Post, Townsville Bulletin, Gold Coast Bulletin, Toowoomba Chronicle and Geelong Advertiser – will continue to publish both in print and digitally.

The following regional titles will become digital only: Queensland – Mackay Daily Mercury, Rockhampton Morning Bulletin, Gladstone Observer, Bundaberg News Mail, Fraser Coast Chronicle, Gympie Times, Sunshine Coast Daily, Queensland Times, Warwick Daily News, Central and North Burnett Times, Central Queensland News, Chinchilla News, Dalby Herald. Gatton Star, Noosa News, South Burnett Times, Stanthorpe Border Post, Western Star, Western Times, Whitsunday Times, Whitsunday Coast Guardian and Bowen Independent, news from the towns covered by the Atherton Tablelander, Northern Miner, Post Douglas & Mossman Gazette and Burdekin Advocate will continue to appear, as it does currently, under the regional sections of the Cairns Post and Townsville Bulletin; NSW – Tweed Daily News, Ballina Advocate, Byron Shire News, Coffs Coast Advocate, Grafton Daily Examiner and Lismore Northern Star; Northern Territory – The Centralian Advocate.

The bulk of titles in our community groups – NewsLocal in NSW/ACT, Leader in Melbourne, Quest in Brisbane and Messenger in Adelaide – will become digital only. Community print editions were suspended early in April because of the impact of COVID-19 restrictions.

The community titles to be digital-only news services are:

Melbourne Leader titles – Stonnington, Mornington Peninsula, Knox, Whitehorse, Monash, Northern, Whittlesea, Maroondah, Moorabbin, Mordialloc Chelsea, Moreland, Lilydale and Yarra Valley, Frankston, Bayside, Caulfield Port Phillip, Cranbourne, Greater Dandenong, Moonee Valley, Maribyrnong, Wyndham;

NewsLocal in NSW and ACT – Fairfield Advance, Penrith Press, Macarthur Chronicle, Blacktown Advocate, Canterbury Bankstown Express, Central Coast Express, Hills Shire Times, Hornsby Advocate, Liverpool Leader, Manly Daily, Northern District Times, Parramatta Advertiser, Inner West Courier, Southern Courier, Illawarra Star, Wagga Wagga News, St George Shire Standard, Canberra Star, Newcastle News, Blue Mountains News, Central Sydney, South Coast News;

Quest in Queensland – Albert and Logan News, Caboolture Herald, Westside News, Pine Rivers Press, Redcliffe and Bayside Herald, South-West News, Wynnum Herald, North Lakes Times, Redlands Community News, Springfield News;

Messenger in SA – Messenger South Plus; Messenger East Plus, Messenger North, Messenger West, Messenger City, Adelaide Hills and Upper Spencer Gulf.

Three Sydney community titles, Wentworth Courier, Mosman Daily and North Shore Times, which are distributed in the city’s most affluent suburbs, will resume print editions.

Some small print newspapers will cease publication, but the local journalism coverage of their area will continue, feeding into the digital masthead for their regional community. The regional titles to cease publication are: Queensland – Buderim Chronicle, Caloundra Weekly, Capricorn Coast Mirror, Coolum News, Nambour Weekly, Ipswich Advertiser, Kawana/Maroochy Weekly, Gold Coast Sun, Hervey Bay Independent, Maryborough Herald, Balonne Beacon, Surat Basin News, Herbert River Express, Innisfail Advocate, Central Telegraph; NSW – Coastal Views, Northern Rivers Echo, Richmond River Express Examiner; Tasmania – Tasmanian Country; Specialist – Big Rigs, Rural Weekly, Seniors

Additionally, we will streamline our community titles and will publish local stories under their regional or city-based masthead. The community titles which will cease publication are: Leader titles in Victoria – Manningham, Preston, Diamond Valley, Heidelberg, Sunbury Macedon, Progress and Northcote; NewsLocal in NSW – Rouse Hill Times; Quest in Queensland – Northside Chronicle/Bayside Star, North-West News, South-East Advertiser, Southern Star, Bribie Weekly; and South Australia – Messenger Coast Plus.

This is massive news that will lead to seismic change not only in news coverage but in news distribution in Australia.

I feel for those directly impacted, the journalists, production people, distribution people and more. I feel, too, poor retailers who will be shaken by the permanent loss of a local paper that helped define their business.

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Media disruption

Bauer closes NZ magazine business permanently

NZ Herald reports that Bauer has closed its NZ magazine business permanently.

New Zealand’s biggest newstand magazines have been folded, as Bauer Media NZ abruptly closes its doors permanently as a result of the Covid 19 crisis.

The New Zealand wing of the German-owned company publishes a range of New Zealand magazines including Woman’s Day, New Zealand Woman’s Weekly, The Australian Women’s Weekly, the Listener, North & South, Next, Metro, Kia Ora, Home NZ and Your Home & Garden.

The closure brings to an end many decades of publishing in New Zealand, with around 300 staff out of jobs.

A staffer spoken to by the Herald said they were “devastated” and “didn’t see it coming”.

This move is a shock.

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magazines

News Corp. to suspend print editions of 60 community papers

Nine has this story:

Rupert Murdoch’s News Corp will suspend publication of 60 community newspapers including The Manly Daily, The Wentworth Courier and The Diamond Valley Leader due to the COVID-19 pandemic.

The company announced on Wednesday morning it would turn its 60 community newspaper mastheads to digital-only products and suspend print publication from April 9 due to rapid declines in advertising revenues.

It’s understandable. Ad revenue has all but disappeared. The question is, will they come back?

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Media disruption

Nine suspend some sections of print newspapers

Mumbrella has this story:

In light of the coronavirus (COVID-19) outbreak, Nine has pivoted its publishing arm. The changes include the suspension of some print sections and the optimisation of newspapers’ webpages to provide consumers with COVID-19 updates.

Non-weekly magazines have been suspended and some lift outs have ceased. The staff impacted by the changes will be redeployed as appropriate, said a Nine spokesperson.

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Media disruption

NZ government closes non daily newspapers

Kiwi blog has this story:

Govt closes down all non daily newspapers

The Government announced:

  • The current focus for government and all New Zealanders must be on minimising the movement of people to stop the transmission of Covid-19

  • In relation to news and  this applies both to the movement of staff of  organisations and their supply and distribution lines

  • The focus for news and media as an essential service has to be on the provision of timely news and current affairs

  • Daily newspapers are currently included in the definition and are expected to take strong measures to ensure safety of staff and the public; combined with their digital reach, they remain essential at this stage for the timely dissemination of news to the majority of New Zealanders

  • Printed periodical and non-daily publications are not considered essential under the news and media designation

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Media disruption

Sunraysia Daily newspaper closing

The Sunraysia Daily has announced it is suspending print operations. Expect more news like this.

SUNRAYSIA Daily will suspend printing and all staff will be stood down due to the impact the coronavirus pandemic has had on the business.

Staff were told in a meeting on Tuesday morning.

It was proposed that Saturday’s paper would be the last edition until further notice.

Staff were told the intention was for operations to eventually resume.

The decision affects all of Elliott Newspaper Group mastheads, including Sunraysia Life, The Guardian in Swan Hill and Gannawarra Times.

Sunraysia Daily, Mildura’s only daily newspaper, is in its 100th year.

 

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Media disruption

Interesting stoush in the UK on newspaper margins

WH Smith stopped selling UK newspaper the Daily Telegraph for several days in train station outlets because of a dispute on margin.

WHSmith has banished the Daily Telegraph from its outlets in railway stations, escalating an industry-wide battle over shrinking margins for newspaper retailers.

After ordering managers to move the Telegraph titles to the magazine section on Friday, the UK chain this week refused to stock the daily newspaper in about 120 railway stores.

The dispute arose after the Telegraph raised the cover price of its newspapers by almost a quarter this month — the daily edition to £2.50 and the Sunday Telegraph to £2.80 — but did not increase the amount paid to retailers by the same proportion.

That move, not sharing cover price gain with retailers, is what has been happening in Australia for a while. As the Financial Times story continues…

The disagreement reflects years of frustration among newsagents, whose sales income has fallen along with tumbling circulation of print copies. While Britain’s national papers have steadily raised their cover prices over the past decade, the increases have been offset by cuts to the retailers’ share.

Yes, here too.

A study in 2016 by Deloitte found that the industry, on average, paid 23 per cent of a newspaper’s cover price to retailers and 5 per cent to wholesalers. Today, the national newspaper average for retailers is closer to 22 per cent, according to Financial Times calculations.

Whoa! UK newsagents are better off that us. We are on 12.5% – making newspaper loss making. Plus, newspaper shoppers are not efficient, they rarely purchase anything else.

Like much of the industry, the Telegraph has struggled to cope with plummeting print circulation over the past decade. Since 2017, the Daily Telegraph print circulation has fallen 34 per cent, from 484,000 to 317,000 copies a day, according to data from the Audit Bureau of Circulations.

Boo hoo. The challenges faced by newspaper publishers are not something small business newsagents have to financially support. We have our own challenges that demand our time and capital.

Note, a few days after the newspaper was removed, it was back on sale. No news of the details of any deal being struck.

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Media disruption

The New Daily on News Corp…

The New Daily has published analysis by Rod Muir on the latest News Corp numbers.

Audiences deserted Rupert Murdoch’s News Corp mastheads in 2019 with its tabloid tub-thumper The Daily Telegraph losing a massive 15.5 per cent of its readership across both print and digital editions, according to research house Roy Morgan.

The performance was reflected in the second quarter’s financial results, which saw the group’s Australian mastheads suffer a 9 per cent revenue hit for the three months to December 31.

“The results were affected by a sluggish Australian economy, uncharacteristic softness in book publishing, and foreign exchange fluctuations,” said News CEO Robert Thomson.

The piece includes this table of Roy Morgan data on new masthead performance:

The latest newsagency benchmark report has similar results for newspapers. While The New Daily piece focusses on the ‘reporting’ published by News, I think the over the counter results reflect a challenge with the medium itself, particularly with the daily print product.

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Media disruption

Bauer Media for sale?

Yesterday, The Australian reported that a proposed sale of Bauer Media has fallen through. Before it was put behind a paywall, I accessed the article:

Magazine issues ‘scupper Bauer Media sale’
Private equity firm Mercury Capital is understood to have walked away from its plan to buy Bauer Media.

The decision comes after the competition regulator stymied local magazine consolidation last month.

People familiar situation told The Australian on Wednesday that Mercury is no longer pursuing the deal, although it is unclear what the Australian Competition & Consumer Commission’s part has played in the decision.

Last month, the ACCC raised concerns over Bauer’s proposed $40m acquisition of Seven West Media’s Pacific Magazines business, saying it could expose readers to higher prices or lower quality magazines.

The landmark deal to combine Australia’s largest magazine publishers would see competing titles Woman’s Day and New Idea, as well as Take Five and That’s Life, come under the same roof.

The ACCC’s concerns came on the same day that Seven West’s $64m takeover of Prime Media failed because of resistance from the regional TV broadcasters major shareholders, rival regional media players Antony Catalano and Bruce Gordon.

In a bid to salvage something from the deal, Kerry Stokes-controlled Seven West acquired a 14.9 per cent stake in affiliate partner Prime on the same day, December 19.

This follows a report in the Australian Financial Review from November

Private equity suitor likes the look of Bauer Media’s magazines
The surprise bid comes only three weeks after Bauer signed a $40 million deal to merge its local arm with long-time rival Pacific Magazines, owned by Seven West Media.

Private equity firm Mercury Capital is in advanced talks to buy Bauer Media’s Australian and New Zealand publishing business, which is home to magazines including The Australian Women’s Weekly and was once the backbone of the Packer family’s Australian Consolidated Press.

Street Talk can reveal Mercury Capital is seeking to win Bauer Media’s approval with a $150 million offer, which would end the German media company’s difficult seven-year stint in Australian publishing.

The surprise bid comes only three weeks after Bauer signed a $40 million deal to merge its local arm with long-time rival Pacific Magazines, owned by Seven West Media, in an effort to shore up its future. That deal is scheduled to complete before the end of this year.

Mercury Capital’s offer would value Bauer Media’s publishing business at about six-times annual earnings of $25 million, with the synergies expected to be “material”, lender sources told Street Talk.

Click on the link above for the full story.

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Media disruption

Starbucks ditches print newspapers

The massive Starbucks coffee chain has ditched newspapers from its stores and, instead, offers free access to digital news platforms, as the in-store sign indicates.

This move makes sense in terms of space use, waste and the digital engagement with customers.

For newspapers more broadly, it is another step in the retreat from print. All that is up for speculation now is timing in my view.

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Media disruption

ACCC publishes statement of issues with Bauer acquisition of Pacific Magazines

The ACCC today has published Statement of Issues with the proposed Bauer take over of Pacific Magazines. The statement includes:

The ACCC’s preliminary view is that the proposed acquisition is likely to substantially lessen competition by reducing the number of major print magazine publishers in key magazine categories from two to one. The focus of the ACCC’s concerns is in relation to the loss of competition in the supply of content to readers/consumers between Woman’s Day (owned by Bauer) and New Idea(owned by Pacific Magazines) and the loss of competition between Take 5(owned by Bauer) and That’s Life! (owned by Pacific Magazines).

Bauer has released a statement:

ACCC HAS PRELIMINARY CONCERNS WITH BAUER MEDIA GROUP’S ACQUISITION OF MAGAZINE PORTFOLIO FROM SEVEN WEST MEDIA

Sydney, 19 December, 2019: Bauer Media Group is disappointed that the Australian Competition and Consumer Commission (ACCC) has today indicated that it has preliminary concerns with the proposed acquisition of Seven West Media’s Pacific Magazines portfolio.

Adrian Goss, Bauer Media General Counsel says: “In view of the ACCC’s own findings in its recent Digital Platforms Inquiry, we are surprised that it has not cleared the acquisition at this stage. While we are confident of receiving clearance in the New Year, the ongoing uncertainty is enormously challenging for Pacific Magazines’ staff and the business more generally. Bauer Media has always seen the acquisition as a positive step towards ensuring the sustainability of print magazine publishing in Australia.”

Bauer Media will continue to cooperate with the ACCC in addressing the matters raised in its statement of issues and expects the acquisition to be cleared in early 2020.

 

-ENDS-

While I agree it will lessen competition, so to would the closure of Pacific.

Magazine publishing has changed dramatically in recent years, with more changes coming. Blocking the takeover, if it did come to that, would serve little purpose in my view.

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magazines

The Washington Post embracing TikTok…

TikTok is a fascinating platform to me. fascinating because the common questions re what? and why? It is interesting to see The Washington Post has someone full time creating TikTok content like this.

Happy Friday…

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Media disruption

The fundamental way accessing news has changed

Since newspapers began, they can controlled access to their stories in print and, later, online. That has served them well, delaying the impact of digital engagement that we see impacting many other industries.

That is changing, and fast.

With more and more news and content aggregation services and an apparent like of bundled subscription services, newspaper publishers are on board and overing lower cost access to some of their content through these platforms. This is a fundamental which in their model.

The story is the thing for many. They will pursue a story or topic as an entry point rather than going to a masthead and reading what it has to offer.

For decades, we’d pick up a paper and read what the publishers served.

Today, thanks to rap[idly evolving mobile tech, we start with what interests us and let that guide where we go.

Online retailers dealing this. Their realise that their brand is irrelevant to shoppers pursuing an interest or product. Look at Google searched, they are far less for department stores than specific items for sale. The same is true for Google searches for news. People search for the topic  rather than the masthead.

This is why I think services like Apple News+ are driving  seismic change in how, when and where news is accessed and why I think it is today far less abut the masthead than it is about the story.

An interesting shift will come when News+ and similar connect directly with respected journalists, cutting out the middle-man of publishers. We see this already through a range of websites. I expect the pace of change here to pick up.

Where are newsagents in all of this? Nowhere except for some gift cards some of us sell for a micro margin. We partner with publishers for print product product only. For digital, they have different and bigger partners who get them closer to people prepared to pay for their content.

I see no downside in this if we have embraced new traffic opportunities and are bringing people to our shops and websites for other products we sell, products through which we can adjust our focus.

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Media disruption
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