Nov

26

Desperate is as Desperate does

Filed Under Blog, news media, Publishing, Uncategorized | 2 Comments

Advance warning of gales and turbulence at the bottom of this garden: readers with enhanced sensitivity should tune out and under 18s should go to bed NOW.

Doncaster. Barnsley. Lynn (where?) All wonderful townships in the UK.  Barnsley once had coalmines, and gritty Yorkshiremen who won’t pay ‘owt for nowt come from there. Doncaster has a race track and a motorway junction. Lynn is … in Kent ?  Or is it East Lynn?  See my problem?  When something happens in these places it has to be big to get national coverage in the UK.  Otherwise, these are small places with small local newspapers …

Today www.holdthefrontpage.co.uk reports that the local newspaper websites from these three very respectable places (where is Lynn – perhaps it’s a girl?) will get paywalls in Johnston Press’s new Murdoch-inspired “make them pay and snub Google” policy.  Yes, Johnston Press, whose last CEO walked out of Fish4 (then the UK’s co-operative regional press classified advertising service online) on no less than three occasions when he bought news groups who had shares.  Johnston Press, which denied the existence of a web threat until the onset of the current recession.  Johnston Press, which has stared fixedly at annual losses in circulation for a decade without making a major strategic move to do anything about it, and which went over a precipice of advertising decline in the last two years.  Yes, that Johnston Press, whose then CEO , in a conference at no less a place than the Worshipful Company of Stationers a few years ago, when I asked from the floor why so few people under 30 read their newspapers, and those numbers were declining, said with all the silky charm of a newsman ” well, history shows they always come back when they get older”.

Grrrrah!  That feels better.  History shows that revolutions do take place, and sadly some great people, including the present CEO of Johnston, will get hurt by it.  The people of Barnsley will use Google to find the BBC local radio news, the paywall will eventually kill the web presence in Doncaster, the key people at Johnston will find other media activities, and the shareholders, who have been as careful about voicing criticism as investors in Britain’s banks, will wonder where their investment went.

And it is all so unnecessary.  I have been researching community and social media advertising environments this week.  It is clear to me that we were quite right at Fish4, where I was chairman in the mid-1990s, when we said “build national, sell local via community web presence”.  So the people of Doncaster will, if events run as I fear, lose their local newspaper because a lot of stubborn managers cannot distinguish between users’ needs and format of delivery.  Stick to the first, be agnostic on the second – this is the clear lesson of history.  As they say in Yorkshire, someone who ignores that is a “daft ha’porth”.

Take one last look before they go behind a paywall and into the DarkNet: www.doncasterfreepress.co.uk, www.barnsleytoday.co.uk and www.lynnnews.co.uk.  £5 for a three month subscription!

Nov

24

Springer’s Dance to the Music of Time

Filed Under Blog, Industry Analysis, Publishing, STM | 2 Comments

Once again the hills around Heidelberg are alive to the sound of music.  This time, however, we know when the music stops.  As the Springer debt of around £2 billion matures in the next year, owners Cinven and Candover must decide whether to renegotiate with the banks – expensive – or sell and trigger the change of ownership clauses that allow the banks to renegotiate the debt – very expensive , but someone else’s problem.  After all, Cinven and Candover have already cleared their profits in the three re-financings they have already led and will not wish to stick around to see that margin diminished. The FT (24 November 2009) says that the private equity owners will now sell the whole of Springer for less than the €400 million which they had hoped to get for only 49% just a few months ago .

Those private equity players still in the bidding (the FT says they are EQT and Apax) must be very miffed by these proceedings.  And the Springer management team, which has done a splendid job in reviving the margins of a great but wasted asset since it took over in 2003, must also be scratching their heads, and wondering if this is the moment to leave the dance floor and head for the bank.  But if the price is really where the FT says it is, then the door would be open for many more players to join the game of musical chairs.  The private equity players are put off by the debt , the regulator would rule out Elsevier, Wiley-Blackwell are still swallowing and saying never again, but a joint enterprise of Thomson Reuters Science and Healthcare with Springer, floated in New York , would make great sense.  It gives Springer more US exposure and adds a healthcare arm, and the potential of using ISI as an upward step into academic and research service markets.  Which is just where a major primary content publisher should be wanting to go.

Verdict: this is just too obvious ever to take place. When the music stops, you usually find you are on the wrong chair, and sometimes that you do not have a chair at all.

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