An editor has hit out as his local council for providing “unfair competition” to his newspaper in its own fortnightly newsletter.
Keith Magnum, left, founder of the Hackney Citizen, says Hackney Council is taking away advertising revenue from the local press with its Hackney Today publication.
The free Citizen is published monthly and has a print run of 10,000, while Hackney Today is published fortnightly with a print run of 108,000.
Government guidelines currently state that local authority-run publications should have a publication frequency of no more than quarterly.
Keith made the criticism in an open letter to Mayor of Hackney Philip Glanville published in the current edition of the paper.
He wrote: “Whilst we have always recognised the right of the council to produce its own communications for residents, we regard the selling of advertising in its publications and on its websites as unfair competition.
“Like the BBC, the council’s fortnightly freesheet Hackney Today is funded by the taxpayer – and would not be viable were it not subsidised by the taxpayer. It does not rely on advertising sales as its lifeblood. But local news publishers do.
“The council’s selling of advertising therefore makes the funding of effective government scrutiny more difficult and in so doing has an adverse effect on local democracy and debate.”
However, Mr Glanville has defended the council’s policy, arguing it would lose between £100,000 and £150,000 if it did not sell display advertising for the newsletter.
He said: “Hackney Today is still by far the most popular source of information in Hackney about the council, other local services and national policy changes, especially amongst older people and those on lower incomes. Given the amount of change around housing, education and welfare reform it is more important than ever that this information reaches everyone in the borough.
“The advertising revenue it raises takes pressure off scant public resources, but the paper has always been run in a way that does not aggressively compete with other local titles. Most advertising revenue comes from partners such as the NHS, schools and colleges and housing associations who wish to take advantage of its borough-wide door-to-door distribution.
“The council’s website sells advertising through a national network, and does not compete by taking ads from local business.”
In response, Keith said: “Hackney Today may be the most popular source of information about the council, but it is difficult to measure this. It is also an easy argument for the council to make, given that it has at least ten times the circulation of any printed news publication in the borough.
“Mayor Philip Glanville does not deny that Hackney Today sells advertising space to local businesses and therefore competes with newspapers like ours. Three years ago I said I did not regard Hackney Today as a competitor. But the commercial landscape for national, regional and local papers has changed significantly since then. Journalists are being laid off left, right and centre and newspapers are folding.
“The vast majority of London boroughs, including the most deprived borough – Tower Hamlets – manage without ad revenue from council freesheets. I have never denied the council has a right to communicate with local residents – this is about how that is funded.”
“If the challenges for local newspapers are exacerbated further by local councils, it will have dire consequences for democracy.”
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In the commercial world we live in and with council budgets slashed,the need to self fund or part fund is a neccessity which cannot be ignored,however much the editor may not like it and however much he feels the pasper is missing out ,the real answer to all this is when he himself says “…given that it has at least ten times the circulation of any printed news publication in the borough”
again,in todays harsh economic world local businesses will advertise where they feel they will reach the largest number of people and where they will get response,sadly if the local paper is only reaching 10,000 people,the council version is a better sales proposition, a fact of life many regional publishers are finally coming to realise,theres strong opposition out there offering potential advertisers a better reach and in many cases a better service.
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Many regional newspaper groups,mine included, have have enjoyed years of unchallenged huge revenues from key categories such as public notices and recruitment advertising until things changed allowing councils more freedom to advertise where they pleased, finally permitting them to break free of the extortionate rates charged when the news publishers had the monopoly on these lucrative revenue streams.
Now there’s more competition coupled with ailing neespaper readerships the publishers large or small cannot complain.
council publishing their own newsletters should not be competition to a local weekly as long as the papers content is of interest to the community, of it is it will attract readers.
If it isn’t ,if the ad service is poor or the paper isn’t reaching the audience local businesses want to reach then it will naturally take ad revenues but that’s the fault of the publisher not the local council.
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Sadly advertisers have twigged, despite the smoke ands mirrors of mixing paper sales and digital “hits”, that their local media is not reaching very many people nowadays. It makes sense to them to put the ads where most people will see them.
My local JP paper once sold more than 20,000 copies in a small area, pretty near saturation coverage. The population has soared and the paper now sells about 5,000. As the ad says “Do the Maths”.
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It’s astounding how compliant journalists on this site are these days.
1) Grow a backbone.
2) It’s not the taxpayer-funded public sector’s job to undercut commercial newspapers, nor should it be distributing unchallenged town hall propaganda designed to whitewash over the wasteful incompetence of local councils.
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who says theyre undercutting?
this is all about the commercial aspect,not the editorial stance
The basic sales proposition and readership numbers seems to me to be a strong one,10 – 1 in favour of the council newsletter,thats all local businesses will be interested in when it comes to parting with their coveted ad budgets.
Had the distribution of the free paper been stronger no doubt the council wouldnt have got a look in on the ad revenues as the busiensses would have gone where the audience is,100k v 10k its a simple commercial choice.
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Councils don’t sell bread or booze, mend my car or rent me my phone. Why should they produce newspapers and sell advertising?
The public sector so often sees ‘subsidising’ by selling some advertising as the equivalent of a victim-less crime. It isn’t. Whether its ads in a newspaper, Google network ads on their website or digital ‘posters’ on their own outdoor sites, they are taking money out of private sector competitors’ finite marketplaces.
That might be fine, but we need to accept that it provides significant competition, not only to newspapers, but also to radio stations, other online competitors and outdoor operators.
At a time when Facebook and Google are exploiting their (albeit hard won) dominant position and sucking up advertising revenue left-right-and-centre, local publishers could do without state subsidised competitors.
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If the newspaper is strong and is a credible option for local businesses to advertise in they will , ironically most I speak to have little time for the council but when selling their products or promoting their services they go where they feel they’ll get most response and it’s no longer the local rag.
Hard pill to swallow but fact of life in the modern world.
Local papers are like any other business, if they offer a good service and value for money they need not worry about the opposition whomsoever it is
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I have sold advertising on several local newspapers and other publications for many years. With the appearance of council funded propaganda ‘freesheets’ – I saw first-hand the considerable financial impact on ad revenues of local papers, and saw newsroom and other staff made redundant because of it.
Advertising is vital to fund production costs. Income determines pagination. The fewer ads, the fewer editorial pages. When revenues drop, newspapers become slimmer with less news. Less news pages means a less attractive proposition to advertisers, and so begins a vicious circle of falling revenue. The newspaper then faces a serious survival battle.
Unless the fall in income is reversed it comes to a point where it is no longer sustainable to publish the newspaper – thus the death of an important method of impartial communication to local people.
I’ve heard it said that councils believe that ‘removing public notices’, previously sold at so called at ‘Inflated’ prices – doesn’t harm local papers. Not true…
Public notices, a statutory requirement, (and ‘classifieds’) are the lifeblood for local papers. Classified advertisements allow the publisher to accept advertising from struggling high street shops and other services at a lower affordable rate. However, some councils are not content with just public notices, it seems local councils are after the High Street stores, and estate agents advertising too. Where does it end? Will they soon be setting up their own estate agencies…oh wait! Yep, they’re already on to that one too.
This is not about publishers sour grapes over ‘revenue’. It is about whether it is right for a local authority to destroy a local newspaper by undercutting, and operating on an unfair playing field by propping up the business with taxpayer’s money. They are not publishing an objective newspaper. It’s council propaganda.
Many paid for local newspapers are now on their knees, and those with free distribution have massive distribution costs, particularly in Greater London. Most could simply never afford to reach every resident. Some choose to distribute by other methods using regular pick up points. This again, in dependent on and funded by ad revenues.
It is not the job of the tax funded borough council to aggressively compete with local newspapers, or any business, for revenue. They should be supporting local business – not destroying it.
To any local council who thinks they are not harming local papers – get real!
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Let me say in my career I have seen some worrying political editorial decisions made purely to preserve council advertising. Those papers went along with the so-called council propaganda and deserve what they got.
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Just hold on a minute! Council newsletters generally cover council-related news and a few local events. I don’t see them writing articles about X Factor contestants, vegetables which look like genitalia (or vice versa) and providing updates on the local football team. They have a unique selling point that is going to be relevant to particular advertisers, just like the local paper could do.
For example, if you have to apply to your local council for a skip permit, why shouldn’t it offer advertising space for skip hire companies? It makes sense to connect residents and local businesses at this point, whether it’s in a printed article or online.
It hardly seems cost-effective for businesses to hope they reach their potential customers by seeing an advert next to an unrelated article on Page 17 of a newspaper with a fraction of the audience.
My point is one I’ve raised on here before. The jack-of-all-trades approach of local newspapers and their websites is a dying entity regardless of council competition or any other. People are far more likely to engage with adverts when they are delivered in a relevant and timely fashion, which is many so many niche publications, websites, bloggers and YouTubers are making a reasonable living out of doing just that.
Don’t blame the council for your outdated business model!
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Well said Oliver, exactly the point I was making
Too many sales reps take the lazy option of moving their regular advertisers onto any feature just to hit a target,get a bonus or get the boss off their backs irrespective of whether the customer gets response, too much focus on short term gain and greed has resulted in opportunities for competitors,including council newsletters, to get a hold and take revenues simply by doing what the established media group isn’t doing
Yes your business plan is outdated and no one has a Devine right to anyone’s business anymore, it’s a buyers market and the best ‘provider’ will win
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