Trinity Mirror chief executive Sly Bailey has said the regional press industry is currently “bumping along the bottom” in her evidence to the Leveson Inquiry.
As seven regional editors prepare to take the stand at the ongoing inquiry into press standards tomorrow, Ms Bailey has painted a bleak picture of the industry’s prospects.
She began her verbal evidence yesterday by revealing that the company now publishes 20 fewer local newspapers – 140 – than the figure she originally gave the inquiry in her written evidence.
Responding to a question from Lord Justice Leveson about the difficulties facing regional newspapers, she said the pressures over the past five years had been “intense” with recruitment advertising revenues hit hardest.
“As we’ve seen a worsening of the economy pretty much since 2007, the category that’s been hit hardest, which is our highest yielding category which really supports our news-gathering activities, is recruitment advertising.
“So at the peak, we had around £150m recruitment advertising supporting our titles, and last year we had less than £20m.
“And when you’re facing that happening to a business, then you have to reduce your costs effectively and quickly to ensure that you have a business and that you can come out the other side of that.
“That has been the primary issue, it’s almost like a falling knife that’s been getting sharper on the way down as we have gone through the cycle and we’re bumping along the bottom but it’s yet to improve.”
Ms Bailey also spoke of her concern about regulatory obstacles on local press mergers, accusing the authorities of using “very narrow definitions of print markets.”
“We are competing for readers’ eyeballs and advertising revenue in a much broader sense than we have ever done before. So the BBC online locally is a big competitor. Google will be a competitor. Rightmove will be a competitor, because that’s just simply what’s happened to our business.
“I do fear that that’s still not well enough and properly understood. And that’s the biggest thing that could hamper, that should consolidation be in the interests of our shareholders, the concern would be that that wouldn’t be allowed to happen.”
“We saw it demonstrated only a couple of months ago with the Kent Messenger Group unable to purchase the titles from Northcliffe that they wished to, and after that we saw a number of title closures, which cannot be a good thing.”
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The Region Press “bumping along the bottom” is entirely down to the likes of Ms Bailey, as a result of protecting shareholder interests on a purely short-term basis with no thought of the long term future of the company and its once great portfolio of newspapers. Combine that policy with the chaotic rush into digital with no real strategy and you have a company hurtling into oblivion.
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Absolutely agree with you Tog.
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Yeah thanks for that Sly.
Good to know your faith in the regionals is so “robust” to use a favourite TM phrase.
And any falling knife is likely to wielded by one S Bailey.
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Sadly Sly’s pay package at £1.6 million in toto doesn’t seem to reflect the state of the industry – although allegedly she’s enduring the TM pay freeze this year.
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@ Greeno – I love it!
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I found her testimony an utterly depressing but surprisingly honest assessment of the situation. Sylvia’s achievements are probably no better or worse than others at the helm of rival groups in the sector.
It seems that when the times are good, people in such positions simply ride the upturn and accept the accolades (and bonuses). But when they’re bad, they hang on with their fingers crossed hoping for better times.
In the meantime, they decimate the staff to try and maintain profit forecasts to pacify the shareholders – of which I’m one.
The sad demise of the News of the World gave Trinity Mirror a lucky windfall of Sunday sales or their situation would be even bleaker. It barely caused a blip on the share price though.
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It’s the same the whole world over;
It’s the poor wot gets the blame;
It’s the rich wot gets the gravy,
Ain’t it all a bloody shame.
Nothing changes, does it??
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Agree with Two Pen’orth – much as I don’t like bosses full stop (power corrupts etc) I don’t think anyone can find a way out of altering people’s reading habits. It’s alright to talk about iPads and this that and t’other but the fact is more and more people don’t read newspapers and there’s no evidence as far as I know to suggest they take any notice of a flashy ad or something like that online to allow this to support print. And I wager more and more people use online jobsites to look for work these days – for free – rather than buy a paper in which there’s little they are interested. Sad but the way it is
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It seems simple to me. I don’t think there is anything wrong with print as a concept (it’s too easy to blame digital) but what has gone wrong is that people are used to information for free and some of the regionals are still increasing the cover price! It’s just too easy to say ‘I’m not buying it today’. I’m a former newspaper journalist of many years’ standing and even I don’t buy my ‘local’ paper any more. Also, the massive cuts to reporting staff mean that papers are falling back on, let’s face it, tedious court rubbish and the relevance of the papers to most people is getting more and more stretched.
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