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Reports claim ex-Local World boss to launch bid for JPIMedia

David MontgomeryFormer Local World boss David Montgomery is poised to launch a “media takeover spree” with JPIMedia touted as his first target, it has been reported.

The Daily Telegraph has cited City of London and industry sources as saying David is “within days” of revealing a new company called National World.

The Telegraph reported the company “will aim to capitalise on the decline of print newspaper circulation and advertising, with David, 70, planning to “target struggling newspaper publishers in a takeover spree and strip out costs as he attempts to build a new digital giant.”

David, pictured, was chief executive of Local World when it was sold to Trinity Mirror for £220m in 2015, but left the business as a result of the deal.

Trinity Mirror’s successor Reach plc revealed last month it was in the “early stages” of talks to buy part of JPIMedia, which recently confirmed it is up for sale.

An unnamed industry source told City A.M. that Reach had been “knocked sideways” by David’s interest, saying he has launched a “relentless pursuit” of JPIMedia.

Former Reach and Trinity Mirror chief financial officer Vijay Vaghela is also registered as an officer at National World, filings on Companies House show.

Vijay served at the media group for almost 24 years, and was involved in Reach’s acquisition of Local World.

The source added they believed the combined experience of the two would make for a “formidable team.”

JPIMedia and Reach plc declined to comment when approached by HTFP.

23 comments

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  • August 15, 2019 at 10:12 am
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    Absolutely no disrespect to Mr Montgomery, but this has the smell of his Local World enterprise, viz: buy it, cut everything, sell it to the highest bidder – except, because he’s going national, somewhat larger in scope. Without being in the least bit cynical, it would be a tad awkward if Reach was one day in the position of having to buy National World from the chap who flogged them Local World, wouldn’t it?

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  • August 15, 2019 at 10:29 am
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    I wonder what stripping out costs will mean to staffing levels:?

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  • August 15, 2019 at 10:43 am
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    old snapper: Possibly your comment is rhetorical, but having been down this route a few times, I think the answer to that question is fairly well documented. I feel for the JPI folk who are apparently in the middle of a tug of war between two large entities who both carry axes as a weapon of choice.

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  • August 15, 2019 at 11:46 am
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    There is nothing left to strip out of JPI. Two of my local JPI weekly papers which used to have a combined staff of 15 (excluding ad staff) now have a combined staff of TWO! This guy will have difficulty with the JPI local weeklies. The present and immediate past owners have committed suicide by giving news away free on their dismal websites in direct competition with their own paid for print editions. The main problem is that advertisers, particularly small town business’ refuse to advertise on a platform that only offers annoying pop up ads, micro ads on small phone screens and the prospect of their ad being blocked by the proliferation of ad blockers. Without local advertisers it simply doesn’t work. No-one wants to pay for content on the internet so paywalls won’t work either.As far as local weeklies are concerned digital will never work. But the fools keep trying and failing again a d again. Mr Montgomery will be the next victim of digital news failure just as JP were. What the local weekly press industry needs is small operations without shareholders to pay who can carry on the traditional form of quality local print titles.if I hear the digifiles saying print is dying one more time I’ll come after them. Its NOT dying…it’s being MURDERED slowly. And for what? A platform and business model that is a proven failure. Just because its digital doesn’t mean it will work. One size fits all is a crazy notion. Digital worked in the music industry as we have moved from vinyl to CD to now streaming which saved billions. News can only be paid for by cover prices and decent ad revenues. Especially with local weekly news it is totally unsuitable as a business model. Mr Montgomery proceed with caution.

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  • August 15, 2019 at 12:09 pm
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    Interesting to note that in Australia you now cannot get news online without paying. They have reversed the trend for free online news because it kills print and makes no revenue as we read here again and again. Until we do the same here the decline will continue. Why pay for anything you can get for free?

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  • August 15, 2019 at 1:32 pm
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    My “local” JP weekly rag has a whole page of 100 per cent non-local general national rubbish (eg Premiership football stats!).
    Presumably this desperate space-filling is because it has NO local reporters and therefore can’t find enough news.
    Anyone who can improve on this dismal editorial judgement is welcome.

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  • August 15, 2019 at 1:52 pm
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    Lydia, pay to read may work in Australia because there is no tax-payer funded competitor like the BBC there.

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  • August 15, 2019 at 2:15 pm
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    @paperbky. You are totally correct. Not near enough reporters to cover sufficient news to fill a paper. My JPI paper has 8 pages of ‘company wide generic pages’ full of pure non-local rubbish. Not the way to run a business. Putinng up prices and cutting quality beyond belief. Imagine if Cadbury’s cut the number of nuts in a whole nut bar to 4 and then put the price up.. Crazy.

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  • August 15, 2019 at 2:30 pm
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    DIGI LOVERS…I shall say this only once! Digital DOES NOT work for local weekly news. It will NEVER work. Prove me wrong!!

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  • August 16, 2019 at 12:11 pm
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    I am the biggest critique of what the publishers have done as can be seen by most of my posts on here but not seeing the world has moved on and thinking that local papers will ever be bought in the numbers they used to is pretty ridiculous. Even if they still had the volume of staff they used to putting out good quality content on a daily basis it would be completely unsustainable against the rising costs in printing and day to day operations that are now a fact of the world we live in. Trying to compete against giants like google/youtube, Facebook and even Rightmove who can put a geographical advert in my face for peanuts is a losing battle in print. Sorry but it’s a hard fact.
    Go out in the world and you will see people from 8-60 with their heads buried in a phone like zombies. Nobody or very few people in population terms are interested in buying a local paper anymore regardless of content because it is old news in this 24/7 world we live in.
    Online was the way forward but the publishers went about it all wrong and started about 10-15 years behind everyone else who got rich while they or a lot of them lost it all even though they had both feet firmly through the door as a starting point.

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  • August 16, 2019 at 1:22 pm
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    formerlyloyalfollower.

    People don’t buy local weeklies to get the news in a rush. Most of it is so low-key that readers can wait a few days to have it all in one publication. What they will never do is pay to read all this worthy but fairly dull material online, simply because they don’t need to.
    Pay walls on weeklies are pointless because the news volume and quality is simply not worth it.
    What we all face is a world where digital news and printed matter are both incapable of making decent money.
    We will see more regional papers, with many current weeklies reduced to a couple of slip pages. In fact the process has begun by JPI, whose weeklies are stuffed with irrelevant non-local material just to fill the holes.

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  • August 16, 2019 at 1:35 pm
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    @Dead Digital Horse – here’s a back-of-a-fag-packet calculation for you.

    Last month, Reach recorded 550 million page views on just their regional titles. At an average page yield of £10 / per thousand (I have no idea what Reach’s average page yield is, but that’s a conservative estimate), that’s £5.5m revenue for the month in digital display advertising alone, and doesn’t include apps or sponsored content.

    If that figure were repeated for the full year, that would be the equivalent of 2,200 people earning an average £30,000 per year (this is obviously an indicative calculation, not a meaningful one, as it doesn’t include overheads).

    That figure needs to be much higher, but we’re a long way from “digital doesn’t work”. Digital has to work if you want journalism to have any kind of future.

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  • August 16, 2019 at 2:00 pm
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    @Zenithar: 10+ years of trying hasn’t made digital pay. Big companies like Sainsbury, M&S and Curry’s wil put ads on digital but small local business’ will not. Local weekly papers rely on the small fish advertisers and it is local weeklies which I am concerned with. The digital proponents have been aggressively pushing their platform, forcing it on the public even. Well it still hasn’t worked and maybe its time for print proponents to fight back hard. I suggest that local weeklies only put breaking news on their websites wit a note saying ‘full story and more pictures in Friday’ s paper’. Also just use websites to promote the weekly paper. There is no point in giving detailed news away for free either before or after publication day. If the readers are given no alternative but to buy the paper then the muddy digital waters will soon clear.. Of course this path means that papers MUST be hyperlocal with local journalists and staff photographers covering local events. Don’t forget, faces sell papers. Basically… Do things the traditional way. It wasn’t broken so why try to fix it? The greedy corporations saw a way to cut costs (and staff) dramatically. Btu they didn’t realise that ads on a small phone screen aren’t attractive to advertisers.. Also small local weeklies have been caught up in the crisies of their owners daily products. It would be better if local weeklies could be disassociated from dailies. Owned by independent operations. Digital only puts talented staff out of work, as we have seen. Digital cannot be the saviour of journalism. So far all it has done is put thousands out of work and lowered the quality beyond belief.

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  • August 16, 2019 at 2:34 pm
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    and to top it all, JPIMedia will not be making much innovation in the Digital space at all, as they’ve totally stripped out all the actual doers there, just leaving the talkers.

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  • August 16, 2019 at 2:51 pm
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    @paperboy I completely agree with you. The trouble is that there are now so many ways they can get that local small news stories via individuals and local groups on Facebook, Instagram and other sources that even they are a dying breed of news buyer. I also agree that the paywall will not work here. But as I said instead of being a recognised market leader that could have led the way 15+ years ago and built up the advertising revenue streams alongside the other larger companies on their ascent they came to the party at chucking out time with brands that have now lost a lot of the previous esteem they had or are unrecognisable to many of us and the public in many areas as trusted news sources to go to first.

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  • August 16, 2019 at 3:03 pm
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    DDH, 10+ years of trying also hasn’t made people buy more newspapers, even using the tactics you suggest. As for ‘faces sell papers’, you’ve heard of this digital medium called Facebook, right? There are a few others too…

    Have you ever read a small piece of local news online on Wednesday and thought ‘I must but that paper on Friday’? Not a chance! You can’t expect people to make a special trip to pick up a paper maybe days after the event. Most people will think ‘I wonder if the BBC is covering that’, or ‘I wonder if there’s more about that on Twitter or Facebook’ or, in more and more areas, ‘I wonder if that’s being covered by that small hyperlocal website’. The chances are, it will be.

    I don’t believe that any local newspaper with any amount of staff that can produce enough unique, quality content that isn’t available elsewhere for free or that people would be willing to pay for. This is why local newspapers are dying and local digital websites are more difficult to monetise.

    Local news needs a completely new business model which no one has yet cracked. There are a few glimmers of hope among small hyperlocals and niche publications which can be helped by certain amount of consolidation. However, if digital is not part of their offering, they will eventually fail. As Zenithar has pointed out, digital is making money, just not enough yet.

    Think about this. We have numerous methods of transport to get around. Some people pay to use the bus or train and others prefer to walk or cycle for free, even when they own a car. What they choose to do is determined convenience, cost and, most importantly, need.

    When self-driving cars become a common reality, will there still be a need for as many buses and taxis? No, their business model will have to change. Under your model DDH, you’d expect your self-driving car to take you 100m down the road on Wednesday then have to pay for a bus or taxi to complete the rest of your journey on Friday! It’s just bonkers!

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  • August 16, 2019 at 3:03 pm
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    @the dead digital horse. I have small local companies popping up on Facebook, insta and youtube all the time. I also on average still get 20+ circular leaflets delivered solus and via royal mail on a weekly basis. Knowing the figures as they were for these via multiple publishers as I saw the order and invoice sheets weekly I can tell you they pay a fraction of what they used to going via the local papers. This also targets people a lot better as it’s based on a persons searches rather that paying for 1000’s of copies or blanket deliveries. You’ve also now lost all or most of the property sections to Rightmove especially without free titles that put the property section through tens of thousands of doors.
    Newspapers with the extra cost associated with print now, which is astronomical compared to 10-20 years ago, can’t compete. It really is a different world and all of these small changes add up to a giant problem.
    Yes hyperlocal can succeed with small over heads, small print runs and a targeted market but a large publisher with huge overheads which any large business will have just can’t.

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  • August 16, 2019 at 3:23 pm
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    Ppl
    It’s not just news that has been on Facebook that makes a good quality paper. It’s good journalists. I worked with an amazing local weekly journalist who won regional journalist of the year FIVE times. Its getting stories that you won’t find of FB for front page splashes that also sell papers. So sending out a staff photographer to local events like golden wedding anniversary parties. Simply covering what LOCAL WEEKLY newspapers have always covered. To me digital is better suited to daily papers. If I had a business/shop I wouldn’t dream of advertising on a news site the size of a smartphone screen. And therein lies the problem. My local weeklies reduced their news staff from 15 down to 2. They give news away free on their disnal website and consequently the circulation of the papers have been cut by 66%.the revenue from advertising is useless so to me it’s suicide. That wasn’t caused by FB it was caused by crazy management who tried to ride two horses at once. Now they have a badly wounded print horse and a dead didital horse. The greed and bad management has left the hamstrung. I won’t change my view that digital has been and always will be disastrous for LOCAL Weeklies.

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  • August 16, 2019 at 3:27 pm
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    @DDH – I think the figures I’ve quoted above demonstrate that digital *does* pay, albeit not as much as when we had a monopoly on classified advertising. Local advertisers can and do pay for digital adverts, and they work. Increasing the number of those ads sold (mainly through training – digital advertising is a complex business) means fewer national ads of the kind you describe being sold at a lower rate to backfill unsold inventory, and therefore increases page yield and makes the industry more viable.

    The buy-the-full-paper-to-read-more strategy has been conclusively proven not to work. It just annoys readers, reduces online engagement and makes no difference to print sales.

    I think you’ve answered your own point about doing things the traditional way – it very much is broken, so we need to fix it. It was broken due to the collapse of the classified ad market, which was the main driver of revenue for traditional print publishers, and, I believe, the main reason people used to buy papers in numbers they do no longer. So you’re right that “digital” has put thousands of talented people out of work – but it’s not digital journalism that has caused that shift, but digital advertising.

    Instead of repeatedly decrying efforts to modernise the business model and calling for a return to the impossible dream of the golden age of print, why not try suggesting some ways of helping publishers build bigger and better audiences, or thinking of ways to create content that readers want to pay to read?

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  • August 16, 2019 at 3:34 pm
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    DDH you cannot put the digital genie back in the bottle, we also can’t turn the clock back to the days when a local paper was the main source of hyper local news, had little or no competition and was an essential and habitual buy for most people, those days have gone and times have changed.

    The main regional publishing groups have suffered years of bad management being slow to react to the new digital medium seeing it only as a passing phase and arrogantly reassuring themselves that people would always buy their papers and businesses would still queue to advertise with them, they couldn’t have been more wrong.
    Failure to act quick enough and develop their own digital news strategies including possible online paywalls when people were used to paying to read the news are gone and with print overheads ever increasing, copy sales in irreversible decline and a failure by the boards and commercial teams to monetise digital these old groups are left floundering and are now desperately
    trying to implement paid for subscriptions to a population which in the main simply isn’t buying it ( literally)

    The days of the established daily and weekly papers are over having been overtaken by both social media posts and the new breed of hyper local independent publisher making a success of delivering the level of grass roots local news and features the public want and which the ailing groups no longer see fit to publish.
    How many times have you seen an individual breaking news on their Facebook site with photos and comments only to see the local papers FB site rehashing if snd serving it up some time later by which time it’s already been seen and is no longer news.

    There’s also no future in giving on line tasters to encourage people to buy a paper to read the story a day or so later.
    Far better to support the new breed of small community publisher producing new local papers covering the community and which is being supported by businesses keen to advertise to reach the market they cover.

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  • August 16, 2019 at 3:52 pm
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    Oliver and Phillip have summed it up nicely IMHO
    Whether we like it or not the traditional all encompassing local weekly published for decades by the old school publishing groups no longer exists. The world has changed from the days when queues formed each evening to buy the evening paper for that days news and from when football supporters waited outside the newsagents to buy the football special for the match report of their local side, nowadays news is instant, on hand 24/7 and is accessed constantly via laptops, computer screens and more likely a mobile phone screen.
    Even buying a daily paper is pointless as it’s news is old by the time it’s printed and even the old overnight ‘breaking news’ no longer exists as everything happening is available on line minutes after it’s happened with rolling updates and in many cases video footage.
    Time to let go of the notion of breathing life into dying papers, they’re beyond salvation as long term news sources and are struggling with ways to reinvent themselves when others are doing it faster and with more relevance to local people.

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  • August 16, 2019 at 3:52 pm
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    DDH – You don’t seem to understand that everyone does it cheaper and more effectively. Newspapers were in my life from 5 up till I was 36. I wish I could go back to those times but they’re gone and I’ve put my energy in to other things. Property is sold better via rightmove. Sports are reported in seconds via the internet and social media. Local groups advertise on social media that can be targeted via IP to the area they wish to hit. Hell even your local takeaways that always took out ads now have Just eat and the like. People share info instantly to their friends and then share it to friends etc etc. Even car traders go through auto trader web site now and the app because it’s more cost effective and hits the market they wish to hit.
    Yes you are right that we’ve lost amazing award winning reporters and newsrooms but they could only do the job because of all these revenue streams that supported the business they were in and if you actually knew how much the cost of print has gone up over the last 20 years alongside revenue decline you would be shocked
    I own multiple local buisnesses and I would never use a paper as it’s more cost effective for me to use online sources and my own online prescence that I and many firms create for free. Whether you believe it or not we live in a digital age and nobody in the main under the age of 35 looks away from a screen long enough to pick up a paper now. People are very much different so you could have the best stories in the world on your cover and they would simply say TLDNR.

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  • August 16, 2019 at 4:31 pm
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    I realise this might be like a red rag to a bull, but I believe that the detail provided by digital stats may have actually exposed the falsely-inflated value of local newspaper advertising.

    I have no doubt that when local newspapers sold 10 or 20 times the number of copies as they do now there was more value attached to print advertising. But, in all honesty, how much?

    I recall ad reps saying telling clients that three people read every newspaper, which suddenly became four or five as figures dropped and titles went weekly.

    When the promise of 300,000 daily users visiting a website results in a million page impressions only to deliver a handful of customers, what are local businesses to think?

    Facebook can deliver more local customers for £20 than an advert in a local newspaper/website for £500 or more.

    I’m sure we have been inadvertently and, in many cases, deliberately lying to local advertisers for years!

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