On Monday we kicked off our “If I ran Fairfax” series by asking a collection of veteran Fairfax watchers what they would do to transform the company into a thriving business. Would they follow the Greg Hywood strategy or take a different approach?
Today, a Johannesburg-based journo, a Liberal Party election campaign veteran, a leading ad-man and a former editor of The Age weigh in with their ideas. And, yes, we’ve asked Gina Rinehart what she’d do if she was in the hot seat — no response so far …
The advertising executive: Russel Howcroft (Gruen Transfer panellist and CEO of George Patterson Y&R)
If you look at a newspaper from the past (say the late 19th century) they had the advertising at the front of the book. Editorial at the back.
First and foremost newspapers provided a platform for commerce, via the promotion of products and services, to take place. (Some papers even had a masthead The Advertiser.) The creation of commercial connections via the advertising provided the revenue in order then for the paper to be more than listings.
Over time, what appears to have happened is the advertising people lost power and were moved to the back of the book, and a worse floor in the building, as editorial took control. Newspapers became less and less a platform for advertisers and more and more a platform for opinion. Indeed the opinion people now have so much power over the product that the reader is asked to endure little advertising — which subsidises the opinion — and pay for what was always thought of as tomorrow’s fish and chip wrapping.
Media provides advertisers with a platform to create demand and generate sales. Google is what it is (in commercial terms) because it is a new and incredibly powerful advertiser platform. Facebook value is under question because there is concern over whether indeed it is a media platform (i.e. a place for advertisers and thereby highly valuable) or whether it is just an infrastructure where conversations and connections can take place.
What I wonder about is whether taking your journalism on-line has the advertiser in mind. And whether, first and and foremost, there is a desire to create a platform for commerce.
Perhaps, if I were to run Fairfax, I would change its name to The Fairfax Advertiser — a move which would provide focus on where incredible value lies.
The journalist: Geoff Hill (Johannesburg bureau chief, The Washington Times)
Media is no different from any other business: it must have income enough to pay salaries, grow the product and return a dividend to shareholders (unless you’re the ABC).
For a decade, I published a travel magazine. When we charted our revenue, the money came from advertising followed by circulation and promotions. Like pilots and cabin crew in an airline, our writers steered the plane and made passengers feel good, but they didn’t sell tickets or freight.
The most important people at Fairfax are ad staff. They know the reader demographics, and they tell clients how many women earning $100K+ take The Australian Financial Review or what per cent of Sydney Morning Herald readers will buy a new car in the next 12 months.
I’d pay my sales people huge, fat commissions to bring in the bacon. I’d give them luxury cars, bling phones and good expense accounts, and fire those who didn’t make budget. On my board, more than half the members would have turned one dollar into two, and done it well.
For all the nonsense about advertisers interfering with editorial, I have yet to see one attempt. But I have seen political ads knocked back by editors. I would ensure zero interference of advertising in editorial and vice-versa.
When I worked on The Australian, the late Les Hollings hired people who knew a particular industry, then taught them how to write. If they weren’t that good at words, subs could sort it out (another group I would pay especially well). Thus we had a BSc Agric writing farm stuff and a computer buff on technology. Major Peter Young wrote stories on defence that were regularly mentioned in Hansard.
I mentioned accountants, and a team who understand how money works will be vital. The accounts department will monitor our progress, stave off creditors, guard the cash flow and make sure there’s enough every week to cover bills and salaries. But like the board, I want my steering team to know how to grow money, not just arrange it in columns.
So what about the crash in circulation? In London, The Independent has come up with a brilliant idea. They produce an abridged copy for sale at 20p (around 30 cents) while the main content is in the big edition and, increasingly, on line. In time there will only be the small printed version and a website. I would use this model for SMH and The Age.
Freedom of the press is essential — but it isn’t cheap. Someone has to pay for the bureau in Baghdad and for sales people who love and understand the product.
The spin doctor: Toby Ralph (corporate and political marketing adviser)
Fairfax is a horse and buggy that wants to be a car. Not long ago newspapers were where we found out what’s happening, but irreversibly daily atoms are giving way to continuous bytes and mass media is surrendering to micro.
We’ve never been prepared to pay full price for general news, and won’t suddenly change. Provision of it has been a community service subsidised by the $13bn advertising industry, hungry for reader eyeballs. Within two years, 50% of that expenditure will be on the web – delivering more targeted, engaged audiences more cheaply, thus prising open more wallets for less.
Mass media must not only change, but learn to monetise change.
The new model must deliver paid-for personalised “me’” media –news & information individuals want, online, continuously. This means fewer, better, higher profile journalists, skinnier management, specialist micro mastheads and a board that knows digitalia and marketing.
As owner I’d adopt a fix and flog strategy. Value will continue to evaporate, so I’d do it fast. First sell rural papers while their value endures. They’ll make $155m next year; a sale would eliminate corporate debt immediately.
Then sell Singleton the radio, Rinehart the Financial Review, learn to harvest the 7.1 million unique Fairfax visitors while tabloidising the metro dailies, gearing them for sale to Telstra, or a mining magnate.
Commercialise the core business of the newsroom, recognising that quality content is saleable to others. Subsidise investigative reporting with philanthropy. Toughen copyright protection so TV and radio co-fund content or can’t use it. Properly managed, there’ll be $2 billion cash, no debt and a residual business with a strong future.
The ex-editor: Michael Gawenda (former editor-in-chief of The Age)
Our challenge is produce high quality journalism with significantly fewer journalists, so we have to explain what our journalistic focus will be which means we will have to be clear about what sort of areas we will no longer cover. And why. We will need to be absolutely clear, for our readership and our advertisers, about our position in the market, which unashamedly will be at the top end of the market.
Beyond a few clichés, there was nothing in our recent announcements that truly examined our journalism and how the journalism can be used to define our future. We must produce journalism that they can’t get anywhere else. We can’t cover everything we cover now with fewer journalists.
We certainly need less celebrity stuff that does not build brand loyalty, that is not unique and that has no attraction for advertisers.
Sections such as Epicure and Green Guide in The Age should be spun off as separate businesses, allowing Fairfax to use our brand strength to exploit what digital platforms have to offer: video, audio, updates, and a two way conversation between journalists and their audiences.
*We’d love to hear your ideas – let us know what you would do if you ran Fairfax
These are terrible opinions except for Gawenda’s. Advertising has certainly been a fundamental enabler of a free press in history. However, you have to offer substantive value-added journalism to earn the kernel of loyal higher income subscribers that are necessary to monetise the platform effectively through advertising. The marketplace is simply too crowded and fragmented to treat audiences as a captive.
The other opinions would simply have Fairfax further accelerate its decline into farce and irrelevance as just one more occasional read in a crowded marketplace. Just as now, you might occasionally check it out if you see it linked on Twitter (often out of derision rather than praise). You can’t survive simply by being a slightly less crass tabloid than the Herald Sun.
If you aren’t committed to high quality journalism with a strong advocacy masthead that draws on classical liberal values, then there is no platform at all worthy of the name and nobody owes it attention. I’ve been a loyal to Fairfax for many years, but I could care less if it dies in its present form. You have to earn respect to get it.
To do that, there are a number of reforms that are necessary. Gawenda covers the reporting side admirably, but it’s also about opinion.
First, get rid of the extraneous pop-culture zeitgeist columnists. It’s not consistent with the brand’s historical values and it’s done better elsewhere anyway.
De-emphasise horse-race, credulous meta-coverage as exemplified by Michelle Grattan. The internal culture should set the tone of the whole paper. Politics as a ‘game played by insiders to the befuddlement of the public’ should be a presumed a shameful framework to present in political coverage. And ‘politics as sport’ should be regarded as strained and tired metaphor unless proved otherwise.
Elevate the level of political discourse in the paper by focusing on substantive policy and creating a culture that frowns upon all the typical fallacies of the mainstream media, such as false equivalences and truth is in the middle, he-said she-said without interposing context of any kind.
Create a rational space for the best versions of liberalism, communitarianism, libertarianism and conservatism to contest ideas and outline mutuality in good faith. That means getting better quality contributors across the board, but certainly it means ditching the regular platform given to vacuous pseudo-intellectual rent seekers like the IPA and CISS, and replacing them with genuine libertarians and conservative intellectuals. If NYT can have Ross Douthat and David Brooks, surely The Age can find some conservatives with some intellectual heft and credibility who are capable of operating in the adult marketplace of ideas. If the this started as a strategy to get eyeballs through controversy it has failed miserably; if those organisations want to publish they ought to write a piece that passes on its own merit – not to manufacture controversy.
Also, you need to find bloggers who straddle the opinion and blogging with real wonk credibility and philosophical sophistication and give them prominence on the website and in the paper. Where is our Ezra Klein, Nate Silver or our Matt Yglesias or Noah Smith. Does Fairfax even know these names because I can assure you that a big part of their future target audience – people aged 24 – 35 who are technocratic and politically aware do know.
Every day there are big ideas in political economy, law, policy, journalism and political morality getting discussed by liberals, libertarians and conservatives of a certain calibre in real time. A huge amount of this discussion starts in exchanges by those like the above names. Fairfax is simply absent from this because it has no voice in this arena that can tap into that kind dynamic intellectual energy and conversation. Now perhaps that’s unfair because all papers are absent. But the point is that a serious paper needs to show they aren’t disconnected from the pointy end of substantive discussions, and join the conversations that are already happening.
Bravo William Fettes.
One thing I would add to your comments about finding the Ross Douthats & David Brooks (and actually I would rather give Paul Klugman and Friedman as examples; one reads David Brooks mostly to see what a few top bloggers do to his often weak and incomplete arguments!).
It is the separation of reportage from commentary. It may be a luxury for most newspapers but it is obligatory if the newspaper wishes to retain any credibility. It is an awful turnoff to read half of Michelle Grattan’s pieces that are intended (I assume) as reportage with (I assume) a Neutral Point of View (NPOV) then, in the same issue a horrifically opinionated piece especially these days where she has transgressed from observer, to far-from-NPOV analysis/commentary to out and out advocate (eg. “the PM should resign”). It is intolerable. If she was pensioned off with a part-time job as OpEd contributor (if someone thinks she can do the gig) then that would be tolerable. Of course even should I happen to philosophically agree with a commentary, I still do not want the same writer presenting the reportage pieces.
Thanks Michael,
In relation to Paul, I agree he is an extremely effective and powerful advocate for liberalism and Keynesian economics. However, I was trying to emphasise the credible conservatives who might replace the parade of CISS and the IPA.
I actually don’t mind Brooks as much as you, though I concede he can be guilty of false centrism. I would nonetheless argue he is a genuine conservative intellectual in terms of cultural and sociological analysis – so despite some low-signal columns – he does produce original thought-provoking work.
Friedman I think is a similar to Brooks though somewhat more liberal. That said, I thought The Lexus and the Olive Tree and The World if Flat are terrible, overrated works. I respect his knowledge of foreign policy, but I think people like Fareed Zakaria are better.
Some other names that should provide the model for thoughtful conservative contributors include people like Will Wilkinson, Tyler Cowen and Richard Posner.
Thanks for the great and free perspectives/comments on Fairfax in this article.
Fairfax have enough opportunity if they are looking for a successful business model to fund quality journalism. They already have a network of readers and journalists to tap into and build from so thats a big head start. All they have to do is relocate and build the readership network maybe by offering free content for free membership. Once they strengthen this audience they can find a indirect revenue stream as others have like Facebook. Looking at other organisations just charging a fee hasn’t so far worked unless like Apple and others you have a platform to capture the audience. Audience network and partnerships are the key and then tap into this in innovative ways.