What has seemed a hard week for Australian media has actually delivered less than the coverage and analysis suggests. As usual with all stories, it’s the way you tell’em (writes Peter Coleman).
A couple of weeks before Tuesday’s announcement – intended primarily to placate financial institutions and other investors – a hectoring staff video from Fairfax chief executive Greg Hywood set the tone: Uneasy and uncertain body language presented a schoolmarmish message about trying harder.
The video which accompanied this week’s announcement was little better, presenting a dumbed-down version of the facts for the benefit of any the key stakeholders who couldn’t read.
It didn’t help: The message focussed on the negatives – closing plants, sacking staff, perhaps even getting out of print altogether… with a new tabloid format a minor diversion.
By contrast, News Limited’s Kim Williams’ ‘pussycat’ charm offensive was almost entirely positive: Wisely, he’d got all his ducks in a row, reporting the offer for PBL’s 50 per cent of Fox Sports, and making the long-awaited announcement that for somewhat more than $25 million, Alan Kohler was coming back to News for a fourth term.
And yes, there will job losses – the figure of 1000 has been mentioned in News publications – but the number hasn’t been settled and “it would be reckless to reveal them anyway”.
That Williams could close the Foxtel deal was to be expected. The rest of the announcement was organisational and old news: Divisional reorganisation has been underway since Williams took office, the Méthode systems order – another nice plug for vendor EidosMedia – was confirmed last month, and the ongoing commitment to print was hardly a surprise.
After all, Williams had the couple of days since Hywood’s statement to mull on how not to do it.
‘Reckless’ is a hard word, but it would be hard not to describe the Fairfax statement in those terms.
Anyone who hasn’t received the message that the current management isn’t committed to print must have been living under a stone. Metro media chief executive Jack Matthews has been talking about “the solution readers want, not just the one they have always had”, but there’s no suggestion readers are being accommodated.
The approach may be pragmatic, but is also likely to hasten the demise of elements of the business which continue to deliver most of its cash.
The week has seen commentary of, to say the least, mixed standard.
I smiled at a comment that Fairfax was unlikely to find a local buyer for what the writer described as “the broadsheet presses” but might sell them into China. The reality is that the value of much of the plant is effectively as scrap, and the only party with a beneficial use for it is likely to be Fairfax itself.
The global market is awash with old double-width presses, and even the ten-year-old Tullamarine lines are relatively unattractive when compared to newer more productive equipment. Newspapers in China tend to publish smaller editions in much larger quantities… and buy the latest new machinery to do so.
Oh, and they’re not “broadsheet” presses, of course… merely presses that have been printing a broadsheet product and could equally well print a tabloid (as they do with the ‘Australian Financial Review’). Easy as dropping a folder slitter.
The move to tabloid, incidentally, is less important for the convenience it will bring readers, than for the fact that it will facilitate printing on the mostly single-width presses of Fairfax’s regional plants.
Going tabloid avoids the problem of producing multiple broadsheet sections, something Fairfax has largely dispensed with by turning many of its supplements tabloid already. The company’s only other double-width plant is in Canberra – three-and-a-quarter hours from Sydney, and scheduled to share some of the load after Chullora is closed – in Wodonga (not Albury, as has been reported), 20 minutes further from central Melbourne than Canberra is from Sydney – and in Brisbane.
Commercially, advertisers may come to terms with paying more for less space, with Fairfax no doubt trying to argue that “a page is a page” irrespective of its being half the size. We’re less sure about the reader who this week tweeted a whinge that other travellers wouldn’t realise she was reading an upmarket title.
Industrially, web printing and logistics chief executive Bob Lockley has never quite been able to bring to Chullora and Tullamarine, the culture of the former Rural Press print sites over which he had presided before the merger.
Ten years ago, the concrete and glass halls of the showcase Tullamarine plant seemed an extravagance, built and equipped at a cost of $220 million to produce the newspaper Fairfax had then, irrespective of what was happening elsewhere in the industry or might happen. The presses, and especially those at the partner plant in Chullora, were to prove insurmountably hard to modify to permit a narrower page format.
Two recollections stand out from my visit shortly after the Melbourne plant was opened: Of the time being spent cleaning the acres of glass dirtied by traffic on the passing freeway, and the response to my questioning about facilities for flexible production and editioning. “We’re not that kind of newspaper,” I was told.
Greg Hywood this week held out the possibility of ‘The Age’ and the older ‘Sydney Morning Herald’ being no sort of printed newspaper at all. There is hope, however, that commonsense will prevail, and the company will look for ways of maximising the life its unique franchise.
Former ‘Herald’ editor-in-chief Eric Beecher this week made the point that directors tend to be the last to realise their company is in peril, and that the Fairfax board had ignored warnings in a report he presented in 2008. And he points the finger at today’s chairman, Roger Corbett, as vociferous in his denial.
It’s a matter of timing, but we wonder – as Beecher did – whether Corbett will still be around when Fairfax suffers the greater turmoil his actions must surely have brought forward.
There’s been a lot of talk this week (and before) about quality journalism, but it’s not a commodity Fairfax has exclusively. Good writers come and go (just look at Kohler) and one certainty is that future supply is likely to exceed demand… as it has since the “golden years” of newspaper publishing and in particular, the acquisition 25 years ago of the Herald & Weekly Times by News.
Since then, journalists’ vanity has been served at Fairfax by the illusion of an ‘editorial charter’ worth little or nothing.
I noted the irony this week that Corbett and the rest of the board have apparently not themselves, signed the charter they seek to force on Gina Rinehart.
For the rest, the trauma of the measures announced this week cannot be as severe as the restructuring experienced at the end of last year by manroland, the German maker of Fairfax’s biggest presses. In an administration such as that, all bets would be off, and entitlements limited to the requirements of law.
Incidentally (and another irony), all is not lost for print within Fairfax. In the figures presented this week, Lockley has $42 million to spend on moving plant and on buying new capital equipment.
Our guess is that the now much leaner manroland – which makes the digital finishing systems which may be on that shopping list, as well as the presses to be moved and modified – will get a decent share.