Fairfax upheaval a sign of things to come
Tue, 19 Jun 2012 5:32a.m.
The former editor-in-chief of The Age newspaper, Andrew Jaspan, voiced a commonly held view of embattled Australian media company Fairfax's job-slashing, paper-shrinking and paywall-raising plan to save its digital life.
"It's too late," says the now editor of online journal The Conversation.
Fairfax announced on Monday that it will cut 1,900 jobs, reduce its flagship broadsheet newspapers in size to tabloid, and close its two major printing presses in Sydney and Melbourne in a bid to cut hundreds of millions from its ballooning costs.
The latest changes are coupled with recent moves to outsource sub-editing duties to New Zealand.
Fairfax New Zealand owns two national, nine daily and more than 60 community newspapers, more than 25 magazines, and market leading website stuff.co.nz.
The company employs 700 editorial staff nationwide.
Monday's restructuring did not mention New Zealand titles.
The 170-year-old publisher will also introduce paid subscription paywalls to access online content from 2013, and promote a digital first strategy aimed at capturing the online market where three-quarters of its readers are now found.
Fairfax chief executive Greg Hywood launched the restructure, to the shock of his staff, on Monday under the banner of Fairfax of the Future.
"We are taking decisive actions to fundamentally change the way we do business," Mr Hywood said.
Fairfax's share price has traded at historic lows of around 60 cents in recent weeks and the company had warned of declining revenues and announced the shedding of nearly 60 jobs at its regional papers - which will go to New Zealand - before Monday's surprise announcement.
Mr Jaspan said the company had suffered from a failure of management, with the shift in focus to online a welcome change but one that had been resisted for too long to avoid a damaging fall in the share price, which has left the company vulnerable to a takeover by mining magnate Gina Rinehart, who now owns 18.7 percent.
Mr Jaspan said Fairfax had progressively lost advertising revenue as its lucrative classified business was lost to online competitors.
While the company was cutting its costs, he questioned why it was delaying measures such as reducing the size of its broadsheets until March 2013.
"They just move too slowly. It's too late but at least they now have a plan."
Australian media academic and journalist Margaret Simons said no print company had been immune to the rise of online media.
"The key mistakes were made a long time ago when Fairfax failed to anticipate the death of the classified advertising business," she said.
University of Canterbury Associate Professor Jim Tulley says Australians are switching to digital media more quickly than Kiwis but that New Zealanders will eventually follow our neighbour's lead.
"This country has a different history than Australia in terms of the way in which people think about their newspapers and in our case we have very strong parochial papers that people are happy to support, for now anyway," says Mr Tulley.
NZN / RadioLIVE
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