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Deal done: Johnston Press buys i newspaper but Independent to close

220px-I_Issue_1Regional publisher Johnston Press has confirmed it is buying cut-price national newspaper the i.

The news was tweeted by chief executive Ashley Highfield and editor-in-chief Jeremy Clifford shortly after noon today.

But the £24m deal will mean the closure of the print edition of the i’s sister title The Independent, which is to go digital-only from next month.

Its last edition will be published on Saturday 26 March while The Independent on Sunday will cease publication on 20 March.

The sale of the i and the closure of its erstwhile stablemates were confirmed in a statement by its owners ESI Media, which is controlled by Evgeny Lebedev.

It said that while a “significant number” of the i’s staff would transfer to JP under the deal, there would also be some editorial redundancies.

The i, which retails at 40p on weekdays and 50p on Saturdays, has a current circulation of 275,000 – some 20pc of the “quality” daily market.

According to JP it made a profit of £5.2m in the year to September 2015, with today’s deal valuing it at 4.6 times that figure.

Johnston Press has not bought the i’s existing companion website i100.co.uk, which has been retained by ESI and will be rebranded as indy100.com to stand alongside independent.co.uk.

Instead JP will create a new companion site for the i branded inews.co.uk.

JP has also set out plans for how it intends to run the i, which will continue to take content from Mr Lebedev’s stable under a three-year deal.

It is envisaged that the deal, which will need to be approved by JP shareholders, will be completed by April.

Said Ashley:  “This is a transformational acquisition for Johnston Press and an important step towards delivering our long-term strategy.

“i is a highly regarded newspaper with a clear market position and a loyal readership. By joining with Johnston Press the combined circulation will be equal to 9pc of national daily circulation, making us the fourth largest player in the market.

“This enhanced reach represents a significant growth opportunity for Johnston Press in terms of national print and digital advertising revenue. It also rebalances our revenues towards less volatile circulation revenues.

“With our considerable digital experience the combination of Johnston Press and i will also allow us to grow digital audiences and revenues through the creation of inews.co.uk.”

A statement on JP’s corporate website makes clear that the company intends to position the newly-acquired title as a “premium brand” alongside its flagship regional titles.

It says:  “The directors believe that the acquisition of i would build strength into the existing portfolio of Johnston Press brands, such as The Scotsman, The Yorkshire Post and the Newsletter, enabling the group to offer a package of “premium brands” to the market.

The statement also describes the combination of JP and the i as a “strong strategic fit.”

“i will help build the Group’s national print and digital display advertising revenues through access to a number of strategically important local markets and the large and attractive ABC1 demographic category which comprises 77% of i’s readership, as well as a number of blue chip advertisers, the majority of whom do not currently advertise with Johnston Press’ titles,” it says.

In his own statement, Mr Lebedev said that Johnston Press would be “commendable owners of this great, innovative newspaper, whose success has defied industry predictions.”

He also attempted to portray the decision to close The Independent and the IoS as part of an “historic transition” towards the digital future.

In a letter to staff, he said: “At a time when our journalism is read and respected by more people in more places than ever before, we are embracing an exclusively digital future with www.independent.co.uk and its associated sites.

“The newspaper industry is changing, and that change is being driven by readers. They’re showing us that the future is digital. This decision preserves the Independent brand and allows us to continue to invest in the high quality editorial content that is attracting more and more readers to our online platforms.”

ESI chief executive Steve Auckland added:  “The unique editorial proposition of The Independent is perfectly suited to the global digital landscape. Following this decisive move to digital, we will be as focused and uncompromised as any start-up, but with all the authority and trust of an established newsbrand – a truly unique proposition.

“We now have a clear and secure future path for our businesses. It’s also a further opportunity for our advertisers to capitalise on our growing, smart, affluent and digitally savvy audience.”

As a result of the move to digital-only, ESI Media plans to create 25 new digital content roles, launch a new subscription mobile App and continue to invest in quality journalism.

It also plans to open new editorial bureaux will in Europe, the Middle East and Asia, while expanding the US operation.

However the National Union of Journalists has accused ESI of treating its workforce with contempt.

General secretary Michelle Stanistreet said: “To close these historic titles overnight after a deal clinched behind closed doors, without any consultation or attempts to engage with staff, demonstrates the contempt the company has for its workforce.

“For Evgeny Lebedev to laud closures that will see staff lose their livelihoods as an ‘historic transition’ is an added indignity.

“The fact that our national newspapers can be shut down overnight with no scrutiny and no ability for their future to be secured through other means, underlines the moral bankruptcy of newspaper ownership in the UK. That needs to be urgently addressed.”

40 comments

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  • February 12, 2016 at 12:15 pm
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    Archant had the chance to buy the Evening Standard for £1 back when Lebvedev took over,

    Of course, it must be much happier with its move into broadcast TV instead.

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  • February 12, 2016 at 12:18 pm
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    game changer for JP … one way or the other.

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  • February 12, 2016 at 12:33 pm
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    A complete kick in the teeth for myself and other JP workers facing redundancy.

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  • February 12, 2016 at 12:53 pm
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    Yesterday Steve Auckland said this: “ESI Media remains committed to our brands, building on our fast growing global footprint, whilst cementing our place as the most important destination for audiences in the capital.” I believe there is a word describing a person who does that. Some commitment.

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  • February 12, 2016 at 1:10 pm
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    Don’t see much evidence of digital experience in any other JP titles. With 24k to spend by Ashley, my redundancy, and the hundreds more, was worthwhile though; so that’s all good!

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  • February 12, 2016 at 1:18 pm
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    Don’t let the grass grow, Ash! Look down the back of the sofa, bound to be a few bob there – a bit of retail therapy does you the power of good.
    What does another £24m. extra debt matter anyway? So, you’ve run a company into the ground, ruined thousands of lives, thrown away tons of experience and knowledge, and here you are, doing it all again.
    Send us your old sofa. JP poverty wages puts us on the breadine, and my child needs shoes.
    To the i journos, sorry to welcome you to JP. No such word as quality here. Yet another waste of talented dedicated people.

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  • February 12, 2016 at 1:22 pm
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    So JP have bought something and at the same time killed something off. Wunderbar.

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  • February 12, 2016 at 1:28 pm
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    WHEN are these clowns going to learn that Digital Dosen’t Pay!
    Joe Public won’t pay for anything off the internet unless he’s buying it from Amazon or EBay and advertisers don’t want it because their ads are minuscule on phone screens and ad blockers are becoming the norm.
    For all his bluster about the future is digital Ashley Highfield has just bought a well circulated PRINT product. Unfortunately for him and the newly online Independent. Those figures are about to drop and ad revenue will too. The independent will completely disappear into the ether and the I will go the same way as most JP papers have done under this management. Site hits are one thing but without sufficient ads they are giving the news away for free. How exciting! The newspaper isn’t dying… It’s being murdered by its owners.

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  • February 12, 2016 at 2:01 pm
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    @dick
    He has chosen his words carefully as he carefully doesn’t mention print publications.

    The issues around the closure of the independent print editions are exactly the same as those stifling the regional press, primarily collapsed readership/copy sales and high cost overheads so this has come as no surprise to anyone with many more regional weekly and daily titles to follow suit in the coming months.
    It makes no sense to prop up titles which aren’t cost effective, are losing money,carry high staff numbers and salaries so there’s no real practical alternative than closure or going online only.
    With all regional papers in free fall and with sales figures at all time lows this is, sad to say, the first of many similar announcements that will follow with editions being closed,consolidated with other titles or appearing in digital form only.
    Good wishes to those affected but it won’t be a surprise to many who have seen the signs coming and issued caution on HTFP to those who feel the dire state of the U.K. regional press is a temporary thing that will pass, it isn’t and won’t.

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  • February 12, 2016 at 2:16 pm
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    Don’s dire assessment is correct. The dominoes are falling all around now and to anyone of 50 or under still in the business I’d say cut your losses. Of course, many won’t as they treasure routine and may kid themselves it’ll all get better again. As Don says, it won’t, and you’d be better off looking for something else voluntarily rather than under the pressure of dire necessity. I know, believe me.

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  • February 12, 2016 at 2:39 pm
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    I’m struck by this phrase in the bumf…. “some 1,000 journalists directly employed by Johnston Press.”

    When did this employment transfer of 1,000 journalists happen?

    In 2010 we were told our NUJ strike couldn’t go ahead as we hadn’t specified the right employer in the paperwork. We were told JP wasn’t our employer – as we all believed – instead we were employed by the smaller regional publishing units.

    Johnston Press successfully argued this point in the High Court.

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  • February 12, 2016 at 2:43 pm
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    If the future is digital why is the i doing so well? Usual twisted logic management-speak.

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  • February 12, 2016 at 2:51 pm
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    AH has said for this year, as in previous years, more cost cutting is needed. Well, he’s just spent £24m so I think we can expect this low cost newspaper to be stripped down to the bare bones and have its low cover price increased – and no doubt holding down the pay of JP staff will help towards funding the acquisition.

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  • February 12, 2016 at 2:54 pm
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    So he is making redundancies across the UK but somehow manages to find 24m to buy another newspaper when they’re in decline!!! Nice boot in the teeth to those losing their jobs Ash but, hey it is all good and cosy in your gilded cage. Time for everyone to jump before the ship well and truly sinks.

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  • February 12, 2016 at 2:55 pm
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    As the song goes…’Only fools rush in’. Well that’s exactly what JP and other publishers have done. They have rushed to embrace digital and foolishly cast off print. However now they have egg on their faces as it isn’t paying. CEOs became digital zealots, Uber-Zealot in Ashley Highfield’s case, and got carried away with the savings possible if digital was successful. But it’s not successful and no matter how much people say newspapers are dying it won’t make digital any more successful. Why couldn’t JP have nurtured both platforms together until we knew more about digital. Instead print has not only been allowed to decline but it’s been driven into the ground. So what happens now that digital isn’t working. How many more attempts are JP et al going to take at resuscitating the dying digital patient? Let’s be fair, newspapers are being murdered for an heir that is useless. I’m not afraid to say it..DIGITAL DOSENT PAY…prove me wrong!

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  • February 12, 2016 at 3:06 pm
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    But but everyone, imagine how much JP might have paid for the i ten or so years ago, had it existed. Let’s count ourselves lucky. And we can only imagine what it will be worth in the 2020s.

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  • February 12, 2016 at 3:17 pm
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    Don……
    It really annoys me when I read your comment ‘there’s no real practical alternative than closure or going online only’
    There is…invest in good local staff, put out a good product at a reasonable price and stop undermining print with failed digital rubbish.
    The decline in print sales is a self inflicted wound with a rusty nail. Are these people not supposed to be astute businessmen. Can’t they see Digital is NOT working. Go back to what was successful, put out the best product you can, don’t overcharge and use websites to promote the papers. JP chopped and changed so much and, lowered quality drastically with rubbish templates and UGC and increased cover prices that the readers voted with their feet.

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  • February 12, 2016 at 3:18 pm
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    After years of closures, sell-offs, falling wages, endless cycles of redundancy and a history of disastrous buy-outs that have saddled the company with a legacy of huge debts, Johnston Press buys a national title. It has already ruined its existing daily titles, because Johnston Press was basically a small Scottish weekly publisher that tried to make itself a major player by borrowing huge sums of money and didn’t have a clue how to run the titles it ended up with. It’s as if the owner of a sweetshop borrowed money to buy Marks & Spencer and sacked all the staff because he was used to getting his wife and kids to help out behind the counter and wondered if he really needed all those clothes cluttering up the place. Like many other Johnston Press purchases, this is sheer vanity by directors desperate to be seen as major players in publishing when they are invited to VIP lunches. It’s like watching someone whose house is being repossessed taking out a loan to buy a Porsche because he thinks it will impress his boss. The reality is that a company that only recently was worth hundreds of millions is now worth just over £40m. The management and directors do not have a clue how to run regional dailies (advertising help desks that are only staffed three nights a week are not much use on papers that publish six days a week; neither is a cheap and cheerful publishing system that regularly crashes and loses pages on deadline) and the idea that they have the experience to run a national title is laughable. This may ultimately benefit a few people on the board, but it will be a disaster for the company and its other titles. What’s next? Perhaps Ashley should have a stab at running Greece.

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  • February 12, 2016 at 3:21 pm
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    Amazing…JP plead poverty, yet can find the money for this despite all of the cutbacks, redundancies, and lack of spending on hardware and software.

    Just how many trainees could you hire for that amount of money? How many receptions could you re-open? How many laptops could you replace so they can cope with 21st Century digital demands.

    Infuriating

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  • February 12, 2016 at 3:48 pm
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    Won’t this look great on Ashley’s CV when he strolls into some other super duper executive role? Meanwhile the jobs of countless journalists smoulder in his wake. Job done.

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  • February 12, 2016 at 4:06 pm
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    There’s no business sense in continuing with newspapers that aren’t profitable,so,as hard as it is to swallow, this makes sense. As has been said previously, this will be the start of a steady series of similar closures across the country’s regional press this year with some going online only or merging editions which will only prolong the slow death in an effort to milk every last penny from the market.
    We’ve seen the signs in the first six weeks of the year with job losses,redundancies and cut backs appearing on HTFP on an almost daily basis so this is no great surprise and is just the next step in a process that’s picking up momentum.
    so many once thriving and popular weeklies are bumping along the bottom losing money month after month, issue after issue whilst still incurring staggeringly high overheads and must put them at risk of closure.
    Just look at the awful ABC figures across all regional publishers to see how their performance mirrors this one. A grim prophesy but one which so many on here have seen coming albeit more rapidly than most thought possible.
    It will be interesting to see how different the uk regional maps will look both in six months time and by year end do as @dick minim says if you’re under 50 please for your sakes have a contingency plan and exit strategy in place.

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  • February 12, 2016 at 4:12 pm
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    I realise that it sounds like heresy but I cannot agree with those people who believe that improving the (admittedly often appalling) quality of print media titles is the answer.

    The problem is that a declining number of people of all ages (and virtually no young people at all) now want to buy a hard copy newspaper. I cannot believe that today’s 20 and 30-year-olds will suddenly become newspaper buyers as they mature.

    Another point. Many of the posts on this site seem to believe that there was a golden age when regional papers were brilliantly written, subbed and laid out. In the period when sales were high, many evening and weekly papers were stuffy, ill-designed and often quite boring. Not all regionals were the Yorkshire Post or The Scotsman.

    I started out on a weekly in a medium-sized town. The paper was pretty dull, but sold 18,000 copies. Most people bought it through a combination of tradition (following in the footsteps of their parents and grandparents -something which doesn’t happen today) and the virtual absence of any other medium of local news.

    The current situation is tragic for those working in the print media and for a generation which will never have the chance to do so. It is also tragic for local democracy. But you cannot make people buy products for which, in a different era, they simply have no use.

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  • February 12, 2016 at 4:19 pm
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    Forgot to add the following.

    In the days of high circulations (pre-online) how many ‘readers’ bought an evening paper for the racing results, the small ads (mostly now vastly reduced in number) and the job ads (ditto)?

    Now you can get the racing results etc direct to your phone …

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  • February 12, 2016 at 4:34 pm
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    In the announcement here
    http://uk.advfn.com/stock-market/london/johnston-press-JPR/share-news/Johnston-Press-PLC-Proposed-acquisition/70354708

    It states that
    “i does not currently have a standalone website. The Directors believe this offers an opportunity to launch and develop digital products associated with i’s brand using Johnston Press’ network.”

    I was under the impression that the webiste was i100.co.uk ?

    Anyway, regardless, they have spent nearly £25 million pounds. On what is largely goodwill?

    The independent is going digital only, surely this is a sign?

    Why spend £25 million pounds? For which JP will now have to construct a website – and we all know what JP websites are like – my Adblock Plus and Ghostery blocker blocks dozens and dozens of items and the websites are a shambles.

    So now a once good product is going to go downhill, circulation will fall. The same happended with the irish titles – it spend hundreds of millions of euros on and sold them for around £15m or so.

    The £25m would of been better off spent on bringing out a new digital only paper in the UK/London, which would of cost a fraction of the amount, getting the pension deficit down and paying off the debt.

    Ashley Highfield has no previous experience of being a CEO and it badly shows. He is no doubt going to say that this was a great deal and award himself another nice bonus this year. He will no doubt sell his share options and pocket the money like he did the last £250k or so he sold.

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  • February 12, 2016 at 4:36 pm
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    I agree with you and your views to a point @digital horse but @don is right, no ones disputing what you say SHOULD have been done but we are where we are and all of that has been ignored by self serving, profit chasing shortsighted actions which have resulted in the position all regionals now find themselves in and they’re in a position that is now impossible to recover from. Digital advertising is the responsibility of the commercial teams to find on line e editions but the strategy of going to online only makes sense in terms of cost control, however much we might not like the outcome, due to bad decisions and lack of investment on the print side of the business the market has gone, ad revenues have crumbled and there isn’t any real choice left

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  • February 12, 2016 at 5:09 pm
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    Content style will have to remain as it is, otherwise they will lose shed loads of readers. They won’t want tabloid rubbish,

    The Indy will be charging a large amount for the content ‘licence’, so the current profit of £5m a year isn’t comparable. Wouldn’t surprise me if PA put up their costs as the i depends on it highly, along with Getty and Reuters. JP have been cutting back on the PA packages over the years.

    Lebedev knows what he is doing, dumping the non-profit making paper, selling the good one, which in reality is just a brand as I doubt it comes with many staff or website. I remember when JP bought the Scotsman, someone told me that they thought the building was part of the deal, finding out afterwards that it had a very short lease.

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  • February 12, 2016 at 6:20 pm
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    @Rupert Bear
    Disagree. It may be a niche product but look at Private Eye.
    NOTHING online and a growing print circulation. It can be done, if it’s done properly.
    Don’t give it all away for free, the masses then won’t expect, then demand, it for free. Now JP has gone down that line, like so many others, they will never win back newspaper readers as people are accustomed to getting it all for nothing.
    Listened to a conversation between two people yesterday, one bemoaning the fact he had to watch three minutes of ads before getting to his online programme on All4. No-one seems to understand that platforms, like newspapers and TV stations, need revenue to exist.
    It’s a sad situation, and one of our own making.

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  • February 13, 2016 at 6:47 am
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    Years of mismanagement and unrealistic profit chasing have brought the industry to its knees, we cannot go back as too much damage has been done so we need to go forward and turning once thriving print titles that are now pale imitations of themselves into online only editions is one of the only ways forward, the alternative is to throw in the towel and close.

    Yes, we all know what should have been done and what should have happened but we are where we are and if tough decisions aren’t taken companies and newspaper titles will close,fact.The rate of decline won’t slow down so radical actions are needed.
    With people accessing news instantly as it happens 24/7 via tablet or phone, the need for a local NEWS paper has gone,we can’t halt progress so lets stop looking back and crying over spilt milk and move on.
    There are real opportunities for quality local lifestyle magazines but not those publications who set their stall out to sell news, the days of people buying a paper to find out what’s happening locally or because they always have done are over, increasing cover prices has been the final nail in the coffin for many titles in a last ditch attempt to try to offset falling copy sales which has turned more people off buying and leaving papers stranded without an audience. Making digital pay will be a big task for the conmercial teams but continuing with unwanted print papers who’ve lost their audiences, aren’t attracting advertisers and where quality has been sacrificed for churn isn’t an option and for us in the regional press this news just heralds the first of many provincial papers being forced to go digital only or closing altogether.
    There is no other real alternative despite many on here dreaming of massive u turns with quality staff being taken on ( they wouldn’t join a dying print industry) and huge investment needed to prop up the print side of the business hasn’t happened and isn’t going to happen..
    Many local weeklies are running on empty returning dire copy sales figures which must lead to closure as the cost of producing papers that people aren’t buying is not viable.
    Taking Archants Norfolk weeklies as a case in point, all have seen sales collapse and all have suffered huge readership losses resulting in thin looking watered down papers running old news and rehashed copy from the dailies and which are a pale shadow of once credible local titles,some are selling just a few thousand copies a week and most have seen sales figures halve while cover prices have increased meaning all must be at real risk of closure. High overheads and the cost of keeping branch offices open with high staffing levels yet with dwindling advertising revenues is just not realistic.
    Some will be in denial but facts are facts, people aren’t buying local newspapers anymore as evidenced by the shocking ABC figures across the country and no business can rely on past glories. It’s a bitter pill to swallow but going on line only or closure are the only real options and more and more titles and groups will go this route this year and sooner rather than later.

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  • February 13, 2016 at 10:35 am
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    Everyone has missed the glaringly obvious and critical point here. In the last five years, a time which has seen unprecedented levels of redundancies and falling circulations. The I has launched, grown, and been profitable. Why? I’m guessing it was never saddled with legacy thinking and a huge over reliance on vastly inflated classified ad revenues, combine this with a good product, well designed and at a sensible price and it looks like you have a business model that works. So why don’t people wake up and look at the reality, newspapers ran well can be of great value, to staff readers and shareholders. Whilst I don’t agree with a lot of what AH has done, he’s been given a hell of a hospital pass. Answerable to the city, huge hole in pension fund and massive debt (not a great combination this). More independently owned newspapers, can follow the I model and be successful

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  • February 13, 2016 at 1:53 pm
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    An open letter to the CEO.

    Dear Mr Ashley Highfield, I see your esteemed company Johnston Press is again dipping into its War Chest to splash out £millions on the printed word.

    The roof of our church is in need of repair at an estimated cost of £1.5m. We were wondering if you would like to buy our parish magazine for £2m. (The choir needs new robes and the verger has asked for an increase in stipend).

    I look forward to your response.

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  • February 14, 2016 at 10:44 am
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    Once again, this was announced to staff via an email which only came AFTER it had been all over the national media. Thanks JP, thanks Ashley.

    The email spoke in glowing terms about how this was good news for audiences and for advertisers. This email, sent to staff, made no reference of what it meant (good or bad) for staff. Ashley has given up even pretending to care about his workforce.

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  • February 14, 2016 at 2:32 pm
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    The Independent was a cracking paper and some of its coverage, especially of the Middle East, was the best you’d find anywhere.But people seem to care less and less about current affairs and local news. They get the big stories pop up on Facebook, usually on pages that rip stories off proper news outlets. I follow a couple I must admit – HelloU and Lad Bible and one of them gave me the entire Adam Johnson story the other day. It was the first one I came to so I clicked. I’m fairly sure they didn’t have anyone in court so it was ripped off someone else. I know there’s no copyright in news but surely something is wrong when a site like that probably gets more readers on a story it’s ripped off than the site it’s ripped it off from, which actually covered the story? And by the time the paper is out, the story has done all the rounds online and no one cares.

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  • February 14, 2016 at 8:11 pm
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    Wow … the first national newspaper with practically no journalists and all that reader generated content …. quality, NOT!

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  • February 15, 2016 at 8:59 am
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    From the Guardian:
    ‘Under the deal the i’s 51 editorial staff would then remain in its current offices in Derry Street, London, as Johnston Press only has corporate offices in the capital.

    Highfield said he did not know where the staff would move to when the lease on the office space runs out in 2017.’

    An industrial estate the wrong side of the M25 perhaps?

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  • February 18, 2016 at 10:42 am
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    I see from my local JP “paper” that the deadly hand of the template is strangling design again. It seems even more rigid and dull than ever. Not another revamp, surely?

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  • February 22, 2016 at 2:39 pm
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    On the plus side…they won’t lose as much as they did on the Irish titles

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