Thursday, June 21, 2012

Fairfax sackings on hold - for now - after industrial umpire steps in. Moral and legal obligation to consult ignored, unions complain.

Listen to my coverage of the ACTU's submission to Fair Work Australia broadcast on The World Today.

Stephen Conroy says Fairfax Media and News Ltd restructures highlight "beginning of the end" for print newspapers. Says weekday hard copies dead in five years.

By Business editor Peter Ryan

The dramatic restructures at both Fairfax Media and News Limited in recent days have put traditional printed newspapers on not much more than life support.

But this morning, the Communications Minister Senator Stephen Conroy said the accelerating events marked the beginning of the end for hard copy editions.

"The print newspaper is under enormous pressure and what you're seeing here is possibily the beginning of the end for the print newspaper," Senator Conroy said.

Speaking on Channel Nine, Senator Conroy described the rapid demise highlighted by Fairfax Media and News Limited restructures as "a very sad day".

Listen to my analysis and Senator Conroy's comments broadcast on this morning's edition of AM.

Read the ABC's rolling blog on the restructures at Fairfax and News Limited.

He called newspapers "venerable" institutions that "played a vital role in democracy."

But Senator Conroy signalled he was on a death watch with this prediction for traditional weekday editions.

"I wouldn't be putting money betting that there'll be print newspapers during the week in five years time. There's a very tough time in the print media sector at the moment."

Senator Conroy was speaking after New Limited revealed its digital future yesterday which includes plans to shrink 19 divisions to just five without putting a number on job cuts.

The move follows Fairfax Media, which announced on Monday that 1900 positions would be axed, the Sydney Morning Herald and The Age would go tabloid and printing presses in Sydney and Melbourne would be closed.

Senator Conroy has also expressed his concern at Gina Rinehart's bid for three Fairfax board seats and the opportunity to influence the editorial direction of key mastheads.

"I think the readership of Fairfax, the Sydney Morning Herald and The Age, would be in crisis if any owner was using a paper to promote their own overall commercial interests. This would be a disaster," Senator Conroy said.

"I would urge Ms Rinehart to sign the the charter of independence, accept that the Fairfax newspapers are not there to be a cheer squad for your own commercial interests."

In another development, the Australian Competition & Consumer Commission, said it would be reviewing News Limited's $1.97 billion proposed to buy James Packer's 25 percent stake in the pay television company Foxtel.

The deal, if approved, would give News Limited a 50 percent share of Foxtel with the other hald controlled by Telstra.
Twitter: @ peter_f_ryan

Wednesday, June 20, 2012

News Limited restructure a massive cultural change for staff and editors; 19 divisions shrink to five; but Kim Williams says print won't be abandoned

Stop Press? Fairfax Media's third biggest investor warns The Age & Sydney Morning Herald could close if restructure fails.

By Business editor Peter Ryan

Gina Rinehart's pursuit of editorial influence at Fairfax Media along with three boardroom seats seats is just one of the war fronts the embattled publisher is facing at the moment.

Now the third biggest holder of Fairfax stock is warning that the Sydney Morning Herald and The Age in Melbourne could be closed if the restructure announced on Monday fails to turn the company around.
The funds management group Allan Gray, which holds a nine percent stake, says Fairfax might be forced to sacrifice its metropolitan mastheads to focus on the more profitable rural publishing and digital businesses.

Allan Gray's managing director, Dr Simon Marais, told AM that The Age and The Sydney Morning Herald were in real jeopardy as Fairfax faces hard truths.

"I think the reason you buy Fairfax is not for the metro papers. They've got lots of other assets. And I think the other assets are probably worth more than the current share price," Mr Marais told AM.

"What the market's effectively saying is the metro papers are already worth less than nothing. They're a liability. But if that continues you'll probably just shut them down at some point. I think that's a real possibility."

Dr Marais identified standalone businesses outside of Fairfax's traditional publishing as worth saving such as Trade Me, and

Dr Marais made no apologies for taking a brutal approach to Fairfax's future given Monday's restructure which will axe 1900 jobs, close printing presses and convert The Age and SMH to tabloid formats.

And he signalled concerns about media diversity in Australia were an important but side issue for investors.

" I think over time if you don't have a good product you won't be able to sell it. But I think at some point it's unfair to expect a small portion of investors, mainly super funds, to pay for media diversity," Dr Marais said.

"I think the reality to people must be if you stop buying papers you won't have those papers."

Dr Marais said he was "neutral" about Gina Rinehart's bid for three boardroom seats and the right to intervene on editorial matters.

" You never have a right to a boardroom seat. But I think all other things being equal, it's better to have somebody with a lot of shares being a director than somebody that has no shares," Dr Marais said.

" I think if she say the board is being deficient or inefficient, and it's probably a reasonable thing to make, then I think one should listen to her."

But Dr Marais signalled he was concerned that Mrs Rinehart's bid for editorial sway could be damaging to the product.

"I think if you don't have an independent newspaper it's unlikely that people will buy it after a while so you could damage the value of it.

"But I think on the other hand she does make a fair point in saying she thinks a lot of the journalism and the articles we see are nice to have but they're not generating revenue and they should be culled. And we would agree with her on that stance."

Fairfax Media has been briefing a range of institutional investors about the restructure and its importance to the future of the company.

Fairfax Media shares dived 8.5 per cent yesterday to 59 cents, which is close to its record low.
Twitter: @peter_f_ryan

Tuesday, June 19, 2012

Singo backs Gina Rinehart for Fairfax Media board; says charter of independence is 'double dutch'.

Gina Rinehart confidante and former Fairfax board member, John SIngleton has backed the mining magnate's bid for three seats on the Fairfax Media board.

The colourful media proprietor has rebuffed criticism of Mrs Rinehart's growing majority ownership of the company and has supported her right to influence editorial agenda.

In a wide-ranging interview broadcast on the ABC's AM program, Mr Singleton described Fairfax's charter of editorial independence as "double dutch".

In another development today, a source close to the Fairfax board said Mrs Rinehart's demand for three boardroom seats was "unacceptable" that that the board "would not be bullied" on the issue of editorial independence.

Monday, June 18, 2012

Fairfax Media confronts digital future; 1900 jobs dumped, SMH and The Age to go tabloid.

Read the entire Fairfax Media announcement issued to the Australian Stock Exchange here.

 Follow a blog on today's developments from ABC News Online.

Greek cliffhanger victory to New Democracy delays Eurozone exit - for now.

The victory for the pro-bailout parties in Greece came as a relief to global financial markets which had been factoring in a possible break-up of the Eurozone.

But the wafer-thin victory to New Democracy will do little to end the uncertainty surrounding Greece especially with Germany unlikely to ease the austerity that came with the bailout.

Here's my analysis from this morning's edition of AM.

Here's an updated story broadcast on The World Today.