The chief executive of Fairfax Media, one of two major news publishers in Australia, offered to relinquish half of his AU$804,000 bonus after the print-digital entity announced a $2.73 billion loss yesterday. Sadly, no one is even sure charity can save Fairfax, or Australian journalism in general.
This end of 2011/2012 financial year result announcement comes just two months after unsettling restructure plans were put into place at Fairfax, including 1900 job cuts over the coming three years – slashing about 20 per cent of its workforce.
Since then Fairfax newspaper printing presses have begun winding down operations.Days ago it was reported that 300 Fairfax journalists under the Metro mastheads, in different Australian cities, engaged in a stop work meeting to discuss their professional uncertainty.
Hywood defended the whopping financial loss, arguing that underlying performance of Fairfax showed that the company “has a sound and diversified” business. Admitting, however, that the results reflect a challenging environment.
“Fairfax Media has a sound and diversified business, as shown in the underlying results we have reported today. These results reflect a challenging trading environment. We continue to drive significant change through the business, consistent with our strategy, and we are responding to a stressed economic environment.”
“The cyclical downturn worsened during the 2012 financial year, while continuing structural change is affecting our Metro Media Division. Fairfax has worked hard to respond to these conditions. At the half year we formally announced the Fairfax of the Future program to transform our business. We subsequently expanded and accelerated that process.”
“Despite the tough times, Fairfax is a company that is committed to growth and committed to innovation. We are investing across our digital businesses, which grew revenue by 20% this year. Digital advertising yields grew strongly as advertisers recognise the value of target demographics – the demographics that Fairfax sites attract.”
On the same day, Fairfax business columnist Adele Ferguson laid out the brutal reality for print news publishing in a feature article, saying the structural changes that are taking place within traditional media will eventuate in further losses for Fairfax in the years to come.
Ferguson concedes that while Fairfax is making difficult decisions to survive – restructuring, cutting 20 per cent of its workforce – it’s “early days” for the news provider who is working towards implementing a “digital first” publishing schedule.
The danger now is that private equity “predators” are watching Fairfax with a plan to break it up, Ferguson says.
Currently a media law storm is brewing in Germany that highlights the power of Internet news distribution and the slippery issue of copyright law infringement as well as implementation on the web. It also highlights that perhaps news providers are growing hungry for money … but we already knew that.
Google (s GOOG) has launched a broadside against a proposed law in Germany that would see search engines forced to pay license fees for linking people to news stories.
Well, actually that’s slightly inaccurate: the draft law would make search engines pay for reproducing newspapers’ headlines and first paragraphs. So, take those away and the links are fine. Even if nobody will have the faintest idea what they’re linking to.
Google’s North Europe communications chief, Kay Oberbeck, sounded off about the issue this morning in a guest post for a German press agency. That was in German, of course, so I got him to vent in English as well:
“Nobody sees a real reason why this should be implemented,” he said. “It’s really harmful, not just for users who wouldn’t find as much information as they find now, but such a law is also not justified for economic reasons or…
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There’s signs of life in print media, still. In Australia two recent magazine success stories are perhaps signaling print’s future place in the rapidly evolving media landscape – niche or special interest magazines with loyal, cult audiences.
The good news: They are popular.
The bad news: They are not exceptionally profitable.
Frankie magazine, for instance, has reportedly surpassed glamourous mainstream glossy titles like Harpers Bazaar and Vogue in sales and experienced four per cent growth in circulation in the last year.
The independent magazine’s quirky, arty, literary-leaning content attracts the typically hipster female reader. The content formula is obviously working well, now that Frankie’s publisher Morrison Media launched a sibling title for boys called The Smith Journal late last year.
Then there’s Cult. A new, niche title targeted at the Sydney gay demographic. It frames itself as a cutting-edge culture magazine with a queer bent, but steers away from the stereotypical notions of the established gay scene. It’s somewhat a niche within a niche, so-to-speak.
Despite discouraging print readership and sales figures worldwide and an uncertain media market future, Cult magazine launched in Sydney yesterday. In an interview with the Global Mail published this week, Brad Monaghan, editor-in-chief of Cult and publishing director of Gay News Network, described the print media business model as “robust” and overturns the commonly held “death of print myth,” saying his print publications were doing just fine.
In an interview with The Age the editor of Frankie, Jo Walker, admits that her publication subsists on a tight shoestring budget and has previously been quoted saying that Frankie contributors are ”sometimes paid in hugs and six-packs [of beer].”
So while it’s positive to see print media still has a pulse, its profitability is somewhat disappointing.
In a recent article from The Guardian, journalist Mark Hooper says that niche print media is anchoring and boosting online editorial mastheads and brands. They are not necessarily wildly valuable in monetary terms, but they create extra market attention. Hooper interviews experts who disagree with the traditional mindset that excludes online and print mediums from one-another. They are argue they have different attributes and abilities but can collaborate and co-exist.
If the two mediums can manage to support one another, the death of print really will be the myth Brad Monaghan describes.
Neiman Journalism Lab look into the launch of HuffPost Live, a new streaming TV-style video network from The Huffington Post, and RadioBDC, a streaming radio show from Boston.com.
In addition to newspapers’ inability to successfully implement new and lucrative revenue streams in the digital media age, it’s also bearing a backlash from audiences who are increasingly losing faith in journalists and the work they produce.
The US Pew Research Centre released new figures last week that showed further decline in credibility ratings for most American news organisations, including newspapers and cable news. Out of the 13 news organisations surveyed, the “believability” rating had dropped 6% from 62% believability in 2010 to 56% believability in 2012. That’s compared to an admirable 71% believability rating in 2002.
Australians are similarly disheartened by the media’s output. According to recent figures released by Edelman Public Relations last year the Australian public’s trust in their media is among the lowest in the world, right behind the US.
How can the media expect future audience’s to pay for online news if the general product is considered to be substandard?
How do journalists regain trust from its audiences? How did they lose it in the first place?
Could the widespread transition into pay-walled online journalism content force a simultaneous update in the standards of collating and reporting online news?
According to recent Essential Research figures from 2011, reported by Crikey last year, 13% of voters said they had “no trust at all” in newspapers, compared to a lowly 3% who claimed to have “a lot of trust.” When assessing people’s opinion of online news, Internet blogs remained the least trusted source of information, but figures showed that 38% people did trust news and opinion websites.
Other research by Essential Media reported on he ABC’s Drum portal shows that readers are generally skeptical and believe the media favour big business and corporations in their reporting and portrayals.
Could print newspapers and magazine titles find new life through tablet publishing platforms? The first attempts to trial the idea don’t look so hopeful.
Launched in February 2011, The Daily was the first iPad-only news publication of its kind. Promising to begin with, it quickly gained 80,000 subscribers but since then has reportedly lost money, and now staff. It was deemed to be the first “truly digital” news magazine, downloadable week-to-week on an iPad app for 99 cents.
Many critics disliked its disconnection from the web and after a year of reporting it failed to provide the initial promise of high-value original digital journalism – complaints that readers could find most of The Daily’s news elsewhere on the web or in print arose. This raises an important issue – what news information are the general public willing to pay for, when a great deal of general reporting can be sourced from public broadcasters or an internet news aggregator?
Now the The Huffington Post is giving tablet editions a shot and has now begun publishing its own iPad magazine. It has already dropped the 99 cent price tag after only five editions.
From the UK, The Guardian has reported this month that only 2.1% of readers (17,000) who trialled the iPad edition for three months have decided to pay for an ongoing subscription. The Guardian iPad edition includes reformatted content from the priced print newspaper, with the addition of the Guardian.co.uk web material.
On a brighter note, optimists argue that the initial failures simply signify the “growing pains” of a fledgling product and market.