What local journalism needs to do next

ChronicleThe Oldham Evening Chronicle, published daily for over 160 years, ceased publication at the end of August after administrators were called in. If ever a press release had the ability to stop every journalist who read it in their tracks, it was the one making this announcement from KPMG which circulated that Thursday afternoon. A watershed moment.

What made this announcement stand out was that it was first time a daily newspaper publisher had reached the point where it was no longer able to manage its own decline.

Local newspaper closures aren’t new. They happen with regularity, as do redundancy announcements. They are never done through preference, only ever by necessity. Common journalistic wisdom is that newspapers close when ‘greedy owners’ can’t make enough money from them. They close when they are losing money – a moment which has usually been delayed significantly through cost management, more commonly known as cost-cutting.

To those within in the industry and tasked with delivering a future, it’s becoming increasingly clear that regardless of ownership structure, every publisher is facing the same challenge: To make enough money to remain in business.

A bolt from the blue?

The NUJ described the Chronicle’s announcement as a ‘bolt from the blue.’ It had, however, been somewhat predicted by editor David Whaley’s at last year’s Society of Editor’s conference.

It had a searing honesty I left feeling those in the room needed to hear:

“In Oldham we’ve had an evening newspaper for 157 years. I’d like to think we play a big part in democracy.

“With the pressures on the pension fund deficit and other things one day we could walk in and the door won’t open, that’s the reality.”

Indeed, as far back as 2008, the Oldham Chronicle had reported losses. The collapse of the company which owned the Chronicle, a small independent publisher, is a massive loss to Oldham. It also should serve as a moment for the industry to assess what comes next – and which discussions we focus on.

All in it together

As events in Oldham have shown, regardless of ownership structure or profit requirement, if a publication isn’t making money, it can’t survive.

Journalists love a David v Goliath battle. Steve Dyson picked up that theme in his recent column on Holdthefrontpage entitled: “The future is beautifully small and beautifully local.” He celebrates a series of publishers entering the market – but is it that simple?

Look at the South London Press going into administration after being sold on to its managers by Tindle (before being bought), or the temporary shutdown of the Sunday Independent earlier this year. 

Both have benefitted from new owners coming in – but if small were beautiful, then surely that wouldn’t have been required. As Dave Whaley made so clear at the Society of Editors conference, working for a small publisher just brings different challenges.

The Cleethorpes Chronicle opened in the late 2000s, and claimed to be bringing a dedicated newspaper back to Cleethorpes for the first time in decades. By some commentators, it was heralded as what publishers should be doing: Keeping it local, being skeptical about digital and having faith in print.

It closed during the summer. I always thought it was a particularly innovative newspaper – simple things like publishing two weeks of what’s on every week because readers like to plan ahead impressed me – but when it closed its owners explained that the challenge to gain enough revenue was just too great.

Journalism’s challenge goes beyond ownership structure – it’s about revenue.

Ultimately every news brand is owned by someone. Very few of those someones are happy for their titles to run at a loss. They may only want a nominal return, such as some of the community-owned operations, or a finer margin than PLC shareholders demand, but a profit is still required. And in the global, tech-led world our readers have migrated to, scale is a huge asset for publishers.

One common battle

People I talk to in the independent sector say life is every bit as tough for them as it is for the bigger publishers.

Indeed, in some ways it can be tougher. At least larger publishers have the chance to chase down the benefits which come from scale as they seek to wrestle with the challenge which unites the industry: The migration of revenue from the gated, controlled garden of local print to the crowded local space that is digital. 

Years ago, being super local and seen as such was an insurmountable strength commercially. Two words changed that: Facebook and Google. They aren’t local, but they devote millions to make themselves first choice in the local market for digital advertising spend. They don’t spend a penny on creating content – and only recently have they actively sought to help publishers financially.  Should they do more? You bet.

That’s why I am circumspect about the long-term viability of the new generation of hyperlocal news publications in print. Are they providing something different to Facebook or Google, or have their clients not yet discovered what they can achieve locally through both?

How do you compete with that? Well, by being local, being trusted, and big enough to deliver what advertisers want: Big local audiences, with advertising placed in a brand-safe environment. Only publishers can offer that online, not platforms.

Digital is the only long-term future for local journalism

Digital is not replacing all of the money being lost in print. But it does contribute many many millions, and publishers which focus on driving audiences, and understanding those audiences, will be the ones who secure more revenue now and in the future.

The ones with the ability to invest in that future will also be the ones which prosper, finding new commercial solutions, new platforms for engagement, new training for journalists to focus as much on building community and writing copy, and new services which appeal to readers who, by extension, are consumers too.

Regularly, the strong online audience performances regional publishers report are mocked by commenters on sites such as Holdthefrontpage and Press Gazette. But those publishers are in a far better place in terms of revenue – and therefore cash to support journalism – than if they persisted with early 2000s strategies of trying to strangle digital presence to force readers into print.

 

For all we want to believe it, there is no evidence anywhere that investment in newspapers, or holding back digital, drives up revenue or newspaper sales. It’s been tried again and again. Indeed, it was widely predicted when the project I helped lead to turn Trinity Mirror’s regional newsrooms into digital-first operations that newspaper sales would decline sharply. They continued to move in line with the industry – only Trinity’s newsrooms saw huge growth in digital audiences, and revenue does follow that.

Understandably the National Union of Journalists always raises this point when newsroom reorganisations result in redundancies being announced: “If all this audience is doing so well, where’s the money?” Again, it comes back to where the revenue goes digitally. We need more of it, and have to work to get it. Ruling out digital as a viable future isn’t going to end well, and it’s sad that in 2017 that is even seen as an option for debate.

Our challenge is to make sure there is a future for local journalism in the digital world – because it’s where our readers are. We’d be in a much better place if we’d recognised that sooner – and also recognised that we needed to be listening to those readers.

What if there were no shareholders?

The NUJ, and others, like to plant all the problems with our industry at the doorstep of PLCs with shareholders and imply that removing those PLCs would solve the problems. Like many headline-grabbing arguments it works when shouted through a megaphone or dictated into a press release, but on closer inspection it falls down.

First off, it’s worth remembering that many shareholding institutions are also pension funds – ie the things most of us, including many journalists, are relying on for when we retire.

But what if PLCs suddenly didn’t offer attractive profit margins, and the shareholders upped sticks? It’s a question few people ask – but one which deserved thought. If those companies no longer existed, what would happen?

Maybe some towns and cities would get replacement publications. But based on history it’s safe to suggest many wouldn’t, and certainly not to the same scale of what is there presently.

And would these businesses be in a stronger position to safeguard the future of journalism? The evidence around us – in Cleethorpes, what happened to the SLP, to the Sunday Independent – doesn’t suggest so. There are success stories, of course, but enough evidence to back up the ‘future is small and beautiful argument?’ I don’t think so.

Protecting journalism through listening

What are the alternatives? A government subsidy for local news? It’s advocated by some but there are two reasons why I dislike this. The first is that it runs the risk of putting local journalism in hoc to those we seek to hold to account. Large organisations are better placed to weather such attempted influence, but it would be much harder for smaller organisations maybe employing just one or two journalists who also run the business.

The second reason is that public subsidy admits defeat on our ability as journalists to not just report on the important, but also to explain and engage with readers on why something we’re writing about is important. That part of the job is often overlooked.

Subsidy from Google and Facebook? Would that ever happen? They need to do more for sure, but whatever it is needs to be based on our ability to attract audiences to content.

Might we see wealthy business people investing in news because they think it’s important to do so? Perhaps – but as models go, it’s a shaky one. What happens when the wealth business person becomes less wealthy, or loses interest?

Often, people point to the hyperlocal space as a glimpse of the future. Maybe. The Drum’s write up on the digital only news outlet The Lincolnite’s approach to moving towards profitability by working on relationships with the next generation of ad spend controllers is fascinating. 

It’s not particularly popular to offer a counter view to the ‘big bad corporate’ one, and even harder when you work for one, not least because it’s quite likely you’ll be dismissed as a company man. It’s happened to me on more than one occasion.

It’s also often said that senior journalists working in large companies are keeping their heads down to keep bringing home a salary. That’s not my experience. They believe in the importance of finding a sustainable future for local journalism.

Such narratives deflect from the real issue in hand.

Sensible discussion surely concludes that the future of local journalism is most secure when it is tied to the sustainable success of businesses people want to invest in – be that a big PLC, a small independent or something inbetween. Pitching one against another achieves nothing. 

 

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2 thoughts on “What local journalism needs to do next

  1. Refreshing to read David. Shame those veteran editors who use industry news websites to criticise manangement don’t have a better understanding of how the sector works today and what needs to be done to ensure viability and sustainability

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