[LINK] News, paper-based and digital

[stephen at melbpc.org.au]

In Australia the Audit Bureau is now allowing online newspaper views
to count in circulation figures. This could be the tipping point for
a paper-to-digital transition of traditional print news in Australia?


Fairfax's retreat may be a gain for News 

by: Darren Davidson From: The Australian March 26, 2012 12:00AM 


FAIRFAX Media is stepping up its retreat from traditional print 
circulation, using a new measurement system from the Audit Bureau of 
Circulations to try to offset what could become a problematic message for 
advertisers as it tries to cut costs and quit low-yielding sales and high-
cost regional distribution of its metropolitan mastheads.
 
In what could be seen as a tipping point in competition between the two 
newspaper rivals Fairfax Media and News Limited (publisher of The 
Australian), Fairfax is fast-tracking the use of the Audit Bureau data to 
buttress an aggressive digital strategy, but one News executives hope 
will hand News's metro titles a new competitive advantage, particularly 
in regional areas.

The move comes as Audit Bureau members voted in a major change to its 
system of measurement last week, allowing publishers for the first time 
to add unduplicated sales for digital to traditional print sales to 
provide a total masthead circulation.

The adoption of the audit changes comes as Fairfax Media looks to boost 
digital subscriptions of its titles, including The Sydney Morning Herald, 
while allowing its print circulation to decline. And the relaunched 
Sydney Sun-Herald yesterday provided evidence of this new targeted 
approach, making a virtue of its quality AB audience.

"We're actively managing down unprofitable circulation, and where 
appropriate we're substituting with digital subscriptions," Jack 
Matthews, chief executive of Fairfax's Metro Media, said.

But critics of the strategy say Fairfax is attempting to put a gloss on 
its rapid circulation declines on titles such as the SMH.

"We're managing circulation decline, so there's no argument in 
artificially propping up print decline," Mr Matthews said. "There is no 
masking here. We're a news-centric business model."

Media has learnt that Fairfax began offering the SMH and Sun-Herald's 
education subscribers the opportunity to swap their print subscription 
for a digital edition last October, when it was expected a vote by Audit 
Bureau members on digital circulation would take place in November.

But a change in leadership at the top of News, when Kim Williams became 
chief executive, pushed the vote back to last week.

The managing director of Nationwide News, Michael Miller, questioned 
whether Fairfax's strategy would have any merit with advertisers.

"They're exploring new digital sales channels such as education, and it 
will be interesting to see how the advertising market responds to a large 
number of education digital sales," he said.

Two of Australia's largest media buying agencies agreed the two 
publishers were diverging in their strategy. "How publishers deal with 
those changes is important," said Henry Tajer, executive chairman of 
Mediabrands.

"Most of the ad dollars being ploughed into print are being subjected to 
a greater level of transparency. You can bag Fairfax for trying to mask 
print circulation or you can applaud them for making the digital journey."

Nick Keenan, MediaCom's department head, Melbourne, implementation 
planning and investment, said Fairfax was engaged in a strategy of trying 
to convince the market its future was predominantly digital-based.

"Structurally, they're only just starting to sell the total masthead. 
What you're seeing is Fairfax shoring up all of the fences so the market 
stops focusing on the print, and instead on collective eyeballs across 
all platforms. They're saying, 'Stop buying us as print'," Mr Keenan said.

But media buyer Simon Davies, head of print at OMD, said digital 
subscribers could be worth less than print subscribers.

"Digital subscribers have a different value to print subscribers and 
we're still negotiating rates around the different digital platforms 
versus the print side.

"The pricing for digital is generally lower but it depends on the 
product. For example, some apps are replicas of newspapers with the same 
ads and level of exposure," Mr Davies said.

Mr Matthews defended the decision to push its education subscribers from 
print to digital. "In a fragmented market, advertisers look for targeted 
opportunities. It still makes sense for some advertisers. But it's kind 
of irrelevant because they still get eyeballs on a digital platform and 
the education market offers more valued-added opportunities than a print 
product can offer in terms of interactivity and depth of content," he 
said.

In the most recent ABC figures The Sydney Morning Herald was down 12 per 
cent year on year for its Monday to Friday editions and 7.5 per cent on 
Saturday, while the Sun-Herald was down 8.2 per cent to 406,000 copies.
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Cheers,
Stephen