[LINK] Whatever happened to Fairfax?

[Frank O'Connor]

At Fairfax it was all down hill after Young Wokka did his stuff.

Bottom line: Mastheads are falling all over the world, and about the only real asset any of them currently have is their credibility. Gina Rhinehart and her confederates will destroy that, and Fairfax will conclusively bite the dust within a couple of years. Of course, at 60 cents a share, that's small change for Gina, so even if Fairfax does go under she hasn't lost much ... comparatively speaking.

She will start to run into the media cross ownership problems soon, but the empires she's elected to buy into (Ten and Fairfax) are being run into the ground and losing custom like you wouldn't believe. I can't see that improving. The revenue models are busted, the business models suck, and their consumers' behaviour has been radically changed by the advent of the Internet.

Strange how the mighty have fallen over the last few years ... Nine Network, ACP, Ten Network, Fairfax ... about the only Australian media empires left soon will be Rupert's News Ltd, Kerry Stokes West Australian News (and the Seven Network) and government shops like the ABC. 

The local press (including Fairfax and the ABC) wasn't exactly hugely supportive when Wikileaks was in trouble, so in many ways I suppose we could dismiss the current bleating as simple self interest. Journalists generally have put their heads in the sand with respect to the long term prospects for print, broadcast and conventional media. Some have branched tentatively out into the new medium, but most were content to make assumptions about the current media models that were grossly out of whack. 

As Jan said, it's simple on the Net to switch providers for news and current affairs. The great thing about the Net is also that the capital requirements for setting up a widely disseminated and available news service are minimal compared to the days of pure print, and that good, balanced journalism tends to attract a ready audience. 

I'd kill for a source that provided 'just the facts, Ma'am' and cut back on all the opinion based dross that much of todays media indulges in. Too often nowadays, journalists become part of the speculative stories they publish, become newsmakers in their own right, 'stars' of the media they present us with ... simply by publishing (more often than not) unsubstantiated opinion that masquerades as hard news. Other journalists take easier routes ... publishing PR as fact, entering in to commercial arrangements with sources, being spoon fed by others, or simply by collating news from third parties ... and then they ask for our respect and protection when the media machines they work for come under threat. 

Paper publications, 24 hour old news by daily edition, programmed/scheduled availability of content, the sacrifices inherent in the broadcast model, will all go by the board as consumers become accustomed to accessing continuously updated immediate content when and where they require it ... and no conventional media organisation currently supplies that. Most current Web sites and mobile app servers are not updated in real-time ... but updated to a 3 or 6 hour schedule ... unless the breaking story is of such magnitude that it requires real-time updates.

An application that freed consumers from relying on single sources for continuously updated news and current affairs (for example that allowed me to plug in Reuters for economic and business affairs, numerous local sites for local and Australian news, various overseas publications for news of the world, various specialist sources for sports news on AFL, Cricket, MotoGP, Grand Prix etc etc) through a single UI ... in effect providing an individually tailored news source ... is probably not far off being realised.

I don't doubt that the various polemicists, ideologues and Masters of the Trite will continue to have their various platforms where they preach to the converted ... but the difference will be that the discerning consumer will be able to simply switch off the noise rather than tolerate it as he/she does now under current media models. 

So ... what Fairfax is currently going through is not all bad. Yes, they could have recognised the 'writing on the wall' a decade ago ... but will they, nil they, it was gonna happen whether they did or not. Gina will make it more difficult for them to maintain their credibility with their readers, and hence survive, but journalism will continue. Indeed, the new model means that strict editorial control and centralised editing of opinion will be much more difficult for Gina and her ilk to do ... she would have to buy up thousands of sources on the Net, but millions more would spring up in their place to replace them if she did so.

I guess I'm more optimistic than most.           :)
---
On 18/06/2012, at 9:13 PM, David Boxall wrote:

> Interesting, how getting it wrong on the impact of the 'net contributed 
> to weakening the company.
> 
> From 
> <https://theconversation.edu.au/fairfax-or-gina-fax-lets-have-the-debate-before-its-over-7721>
> 
> The next two weeks will be defining moments for Australia. It’s when 
> Fairfax is likely to morph into Gina-fax.
> 
> On Tuesday Gina Rinehart, the world’s richest woman, is expected to 
> confirm that she has acquired up to 19.9% of Fairfax. The current Board, 
> led by ex-Woolworths and now Walmart director Roger Corbett, is expected 
> to raise the white flag in their efforts to ward off Rinehart’s bid for 
> control. Rinehart is believed to want two or three seats on the board, 
> and control of the Fairfax’s editorial positioning. And what she wants 
> she can afford to buy.
> 
> Running in parallel, Fairfax will announce this week one of the most 
> radical restructuring of its metropolitan mastheads, The Age and Sydney 
> Morning Herald. From July 1 the two papers will be nationalized, that 
> is, converted into one newsroom across both titles. There will be some 
> local differences to allow the content to be rebranded for the Melbourne 
> and Sydney audiences, but two voices in our shallow pool of diversity 
> will become one.
> 
> And Fairfax will reduce its editorial workforce on the two papers by 
> around 25% from roughly 800 to 600.
> 
> In tandem, Kim Williams, the chief executive of News Ltd, is expected to 
> announce the most radical restructuring of the entire News Ltd workforce 
> with a reduction of up to 1,500 staff.
> 
> This perfect storm has been brewing for some time. The decline and 
> implosion of the media was seen as a European or American disease that 
> Australia would avoid, much like the GFC. The seeds of Fairfax’s 
> destruction were born in the mid 1990s when it failed to fully engage, 
> understand and act on the disruptive threats of the internet.
> 
> The story of Fairfax’s decline is one of managerial failure. The company 
> has been run by senior executives and boards with no direct experience 
> running a media company. Instead, leaders at Fairfax have been property 
> developers, management consultants, accountants, and rugby players. 
> Those people did not have the experience or understanding of a 
> people-media business to steer the ship into safe waters. Instead they 
> allowed Fairfax to remain at sea while competitors savaged the business. 
> One by one Fairfax was stripped of its classified advertising “rivers of 
> gold”. The jobs went to Seek.com.au, Cars to Carsales.co.au, homes to 
> Realestate.com.au.
> 
> And shorn of those easy revenues the only way Fairfax CEOs could “stay 
> in the game” was to cut costs faster than revenues fell (all the while 
> pocketing eye-watering salaries and bonuses).
> 
> Instead of having the foresight to embrace and invest in the digital age 
> by bringing together mastheads to work collegiately, Fairfax leadership 
> instead chose to separate the online team from the print team and run 
> them as two distinct businesses, with “Fairfax Digital” competing for 
> advertising revenues with the so-called “Fairfax Publishing”.
> 
> In 2007, I was asked to lead a team of three senior executives to visit 
> the most progressive newspaper/media companies in the US and UK and 
> report back to the then CEO, David Kirk. We went to the Wall Street 
> Journal, New York Times, USA Today, Washington Post, The London 
> Telegraph, The Financial Times and The Guardian.
> 
> We reported back to Kirk that every one of these had brought together 
> “print” and “digital” into one resource. That is one editorial team, one 
> advertising team and one back office. Kirk flatly opposed doing the same 
> on the grounds the two businesses were both very profitable. And he 
> wanted to keep it that way.
> 
> Five years later, with the company’s market value slashed from $7bn to 
> just over $1bn, this integration will finally be imposed next month.
> 
> And for the first time in living memory the change will be led by a 
> former journalist and senior editor, the CEO, Greg Hywood, along with 
> the advice of consultants Bain & Co (Mitt Romney’s crew).
> 
> But it’s too late to save the Fairfax we know. The share price has 
> collapsed from $5 to 60c or less because no one in the market believes 
> there is a coherent strategy for the company. And that has left the 
> company weak and defenceless to predators such as Rinehart.
> 
> Staff, meanwhile, have been living in denial. Though finally last week 
> the penny dropped among the editorial staff that Gina’s tilt at Fairfax 
> will happen. That has led to great despondency, and many rightly 
> concerned about their future. And of course, once in, she is in control, 
> and they will be told if they don’t like it, they can ship out.
> 
> What does this all mean? Rinehart is not an investor in Fairfax to earn 
> a return like the rest of the company’s long-suffering institutional 
> investors. She is making her play to change the climate of opinion in 
> Australia.
> 
> Back in 2010 she and her fellow mining barons spent $22m to get rid of 
> Kevin Rudd’s proposed mining tax.
> 
> And so successful was the campaign that they got rid of Rudd and saved 
> themselves an estimated $20bn in taxes.
> 
> Rinehart’s appointment of Australia’s leading climate change sceptic, 
> Ian Plimer, as an advisor to her mining companies is simply a taste of 
> what’s to come. As one senior Fairfax editor remarked, expect this kind 
> of front page once Rinehart gets control. “Exclusive: Climate Change is 
> a Hoax”.
> 
> Rinehart aims to change the terms of debate in Australia for good. Her 
> fellow Channel 10 director, “Hungry Jack” Cowin, the burger man, will 
> likely join Rinehart on the board of Fairfax. Cowin has already made 
> clear that the Fairfax Board has every right to set the editorial tone 
> of the papers. And that Andrew Bolt, who already has the Bolt Report 
> show on Channel 10, would be welcome at a Rinehart dominated Fairfax to 
> “balance the message that’s being communicated to the community”.
> 
> With such a program, Rinehart and Co may well tell staff and readers 
> that if they don’t like it they can go elsewhere. The problem in 
> Australia is where to? The media is in crisis elsewhere in the West, but 
> usually there is a choice, somewhere else to go to get a job or to get 
> your news and commentary. Right now if you live in Hobart, Adelaide, 
> Perth, Darwin or Brisbane you have no choice, just the one paper. In 
> Melbourne and Sydney, there was choice.
> 
> Readers who, like Rinehart, prefer the editorial tone and message of The 
> Australian, with its line on mining tax little different to that run by 
> BHP, will be spoilt for choice. And scepticism towards climate change 
> will now be shared by all three quality mastheads. Those with different 
> views will have limited options.
> 
> Is this the modern, open, progressive, democratic, tolerant, 
> knowledge-based, clever country we aspire to be? Or are we seeing the 
> same rise of the oligarch as in Russia where the resource-rich 
> billionaires also dominate the media? Or Italy, where Silvio Berlusconi 
> owned the majority of the TV stations and newspapers and imposed his 
> right-wing agenda, and ultimately won control of the country as Prime 
> Minister?
> 
> This is an important moment for all those who cherish democratic and 
> pluralistic debate and a freedom to information that is factual and 
> reliable to inform decision-making.
> 
> Given that both the Fairfax and News Ltd papers are “interested parties” 
> in the outcome, you will be hard pressed to get a full and dispassionate 
> account of the next few weeks' momentous events.
> 
> ...
> 
> -- 
> David Boxall                         | "Cheer up" they said.
>                                     | "Things could be worse."
> http://david.boxall.id.au            | So I cheered up and,
>                                     | Sure enough, things got worse.
>                                     |              --Murphy's musing
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