on media


A vision of less profit and more investment


The New York Times may show a way, says Raymond Snoddy N


ow is hardly the best time to think about different models of funding newspapers and journalism in the


midst of cruel job losses and with the dangers of more to come after the furlough scheme is phased out. But Mark Thompson, former director-general of the BBC and for the last eight years chief executive of the New York Times, has some interesting things to say on what the way forward should look like. Perhaps they’re more ideas for later once the current crisis calms down, if it does in the foreseeable future. The reason British newspaper owners and executives should listen to Thompson is that he has presided over a remarkable period of growth in New York. Not every paper can be the New York Times or match its weight or reach but digital subscription revenues there are running at more than $800 million a year and digital subscribers have passed the 6 million mark and are rising. The paper President Trump likes to


call the ‘failing Times’ is the opposite of that. Perhaps most telling of all in the midst of a very severe Covid-19 outbreak in the US, the paper is still hiring journalists rather than letting them go and adding to its large pool of software engineers. The New York Times executive


believes that too many newspapers are still trying to operate on what he sees as the traditional business model. This, Thompson believes, involves trying to make a big profit every year and then nursing your way through


economic downturns by shedding jobs and hoping for better times to come. Instead, the aim should be to, in effect, limit profitability, in order to invest more not only in journalism but also in the marketing and packaging of that journalism to build a regular subscriber base. He points to the way that Netflix founder Reed Hastings continues to invest billions of dollars a year to build subscribers. Netflix is not the newspaper business and has massive debts, and talk of investing more in newspapers seems quaintly theoretical in the face of the current near-existential threat to many small titles, never mind some bigger battalions. Lockdown only came on March 23 and, before Covid-19, there was a life – and there will be after one after the pandemic, although it may be a different world. It is now clear that, historically, in


what passed for better pre-pandemic times, newspaper owners did not invest enough to build a long-term sustainable future and have often been too fast to axe journalists’ jobs. It seems almost crazy to suggest it


now with the UK economy in its current state but, when the worst is over, a way must be found to invest more in journalism. Journalism, after all, is the product


newspapers and broadcasters sell even though in the case of the BBC it is financed by the licence fee. Neglect or squeeze the journalism


and, ultimately, you lose not just a role but eventually also a business. Back in the harsh world of what is now Reach, publisher of the Daily


Mirror and the Daily Express as well as local and regional titles all over the UK, 550 jobs (12 per cent of the workforce) are being cut.


This is in response to unprecedented trading conditions with revenues in the quarter to June 28 down by 27.5 per cent – print off by 29.5 per cent and digital down a mere 14.8 per cent. Reach is not the first company to


dress up job cuts as a quest for greater efficiency and the avoidance of duplication. There is an element of centralisation


“ ”


The aim should be to limit profitability to invest more in journalism and also in the marketing of that journalism to build a regular subscriber base


involved with production about to be concentrated in a fewer locations. For local and regional papers, ending localness is a counterproductive business step. With Thompson in mind, perhaps Reach could perhaps use the period of consultation as something other than a box-ticking exercise and review the number of journalists it actually needs for a sustainable future. The BBC needs to save £25 million – as a result mainly of director-general Lord Tony Hall’s licence fee settlement with the government and the postponement of most over 75-year- olds having to pay the licence fee. Against such a financial background, cuts are inevitable. It is more difficult to see how ripping the heart out of local radio and regional current affairs with the loss of 600 jobs fits the BBC’s social purpose and reason for a licence-fee funded existence. Not sure whether Mark Thompson would approve.


An interview by Raymond Snoddy with Mark Thompson will appear in InPublishing out on August 7


theJournalist | 07


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24