To understand the shape of a deal for Antony Catalano's Australian Community Media to buy News Corp Australia's regional and community papers, you need to consider that of News' digital footprint.
It wouldn't have been hard for News to turn a dollar on the sale of the string of papers it bought from the then APN News & Media for $36.6 million, especially if the $125 million Catalano and partner Alex Waislitz paid for the former Fairfax regional and agricultural business was any guide.
But it isn't. COVID-19 has changed everything, silencing presses and turning profitable mastheads into cost centres, and we shouldn't kid ourselves that things will return to anything resembling the 2019 marketplace.
A mass of News' regional and suburban print editions are currently on hold, many more are running at a fraction of the advertising volumes needed to sustain them, and ACM has suspended numerous editions and printing plants.
So if Antony Catalano is really still in the market for community market share - and some reports put a deal as early as this week - Rupert Murdoch would be crazy not to take his money. The old Kerry Packer quote, "You only get one Alan Bond in your lifetime," comes to mind, but it's not as simple as that.
If there's one thing Rupert Murdoch likes about publishing newspapers, it's the good old-fashioned power to influence governments - delivered via good old-fashioned print - which has made so much more possible. So if you think of the Northern Territory News as just another regional newspaper, for example, and were wondering why it's not in the deal now being put together, think again. The NT News, with its croc jokes and quirky headlines is all things to all people in "the Territory"... national, metro, regional and local paper, and far more effective than any website might be, given the wide open spaces of the outback.
That state-focussed argument is only partially valid in Tasmania, where News holds the "capital" with the Hobart Mercury, but faces competition from ACM in Launceston and Burnie, as well as from independent publishers.
But it's in New South Wales, Victoria, Queensland and to a lesser extent, South Australia, where the population resides, that News has the best chance of transferring its print audience to digital, and where it has the best chance of "having its cake and eating it". Its metro print editions - healthily now more dependent on subscription revenue than advertising - operate on a different business model in any case, to the regional and community papers, many of which are distributed free.
More than 100 mastheads are in the "on-again, off-again" negotiations to which Leo Shanahan refers in today's Australian, anticipating "a possible deal as early as this week".
Print production issues for example, are complicated, but could easily be resolved by News providing some contract capacity to avoid the need for ACM to take on more presses it may not need at a time when some of its own capacity is already shut down.
In this ongoing story, there seems a new urgency which may lead to a result. Shanahan's comment about hopes of an outcome becoming "less optimistic as sticking points began to widen," suggests it could be bogged down in detail, but News - which has started cutting costs ahead of recommendations from newly-appointed consultants Deloitte - could easily overcome this.
Pictured: An NT News promotion offers crocs and clever headlines for $1 a week
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