A rare feel-good week for publishing
Opinion
From The Guardian‘s positive results to the sale of the Telegraph and National World, UK media brands still make sound business sense and can attract significant investment.
There are not many weeks when you are almost spoiled for choice in deciding which bit of good news about the publishing industry to focus on first.
According to Press Gazette, The Guardian has now returned to revenue growth, thanks to no less than 1.3m paying digital subscribers around the world — at a time when the need for rational, liberal journalism has never been greater.
Despite losses of £25m a year, the fact that The Scott Trust, which controls the newspaper, has £1.3bn in reserves surely adds up to a sustainable future for the media group.
You can carp and wonder why there was such a determination to offload The Observer rather than invest in its future. But after the messy sale to Tortoise Media, that is all history and there is now at least clarity for both sides going forward.
First signs are that the new Observer, with its classy picture-led front pages and new website, could be a powerful international calling card for Tortoise’s main audio- and visual-based business.
The word is that the two journalistic sides of the merger are combining well and, at least on launch, Sunday sales were up 22%. Obviously, there is the curiosity factor and there was ample coverage of the disputes surrounding the merger. The initial uplift was, however, achieved without spending any marketing money and £25m has been raised for the venture.
Overall, it is surely good news for the industry — particularly the part of it that is left of centre.
Telegraph: A £1bn international brand?
At the other end of the political spectrum, there is at least some clarity over the future of The Daily Telegraph after years of being treated as a milch cow by the Barclays family, followed by two years of paralysis as new owners were sought.
Now US investment group RedBird Capital Partners has bought out the Abu Dhabi state arm International Media Investments (IMI) to become the majority owner in a deal that values the Telegraph at £500m.
The last Conservative government blocked the original deal and made it impossible for overseas governments to own or have investments in UK national newspapers.
Rather bizarrely, the current government is suggesting that, instead of a ban, there could be an investment of up to 15% by a foreign state-backed organisation.
This is a thoroughly bad idea. Foreign governments should not be allowed to invest in British national newspapers — period. While even minority stakes exist, it is impossible to know where lines of influence are drawn or what pressures are exerted.
RedBird CEO Gerry Cardinale surely cannot be in that desperate need of IMI’s £75m investment in the venture, because he believes the business can be turned into a £1bn enterprise through developing it as an international media brand.
Cardinale insists that he has absolutely no interest in intervening in editorial matters and that, for him, it is purely a business investment.
He may well be right, but many others have said the same sort of thing and have been put under pressure by others to influence editorial decisions. Jeff Bezos and The Washington Post come instantly to mind.
There is indeed a strong case to be made for turning the Telegraph into a stronger international brand by specialising more on business coverage and in the US.
But such an opportunity should not be bought at the reputational expense of having an arm of the United Arab Emirates — a country not noted for press freedom — as a significant investor.
At least the Telegraph is on the way towards greater stability, whatever the UK government and regulators decide, and mainstream media can still attract investors.
It’s a little bit more good news for the British publishing industry — and if Cardinale’s assessment of the publication’s longer-term prospects turn out to be true…
Good news for local journalism and democracy
Much smaller headlines maybe but the £65m deal by Malcolm Denmark’s Media Concierge to buy David Montgomery’s creation, National World, is another positive development — this time for the local and regional newspaper business.
National World has publications in more than 200 towns and cities in the UK and, in many of those places, could be the only outlet for professional journalism.
Denmark as a private operator is promising to be in the business for the longer term.
A lot of local newspapers have been hollowed out in recent years with round after round of cost-cutting and the quality of local democracy may have suffered as a result.
This has been particularly marked in the US, where researchers have found that some 90% of counties that voted for Donald Trump had no professional source of local news.
You can’t prove causation, but it does suggest that extreme views can triumph when there is no counter to unverified rumours and conspiracy theories online.
The rise of Reform UK, now running councils for the first time, cries out for professional coverage by properly funded local newspapers.
Let’s hope Media Concierge will provide such coverage.
It sounds like a bit more good news for the newspaper business, even if it could be the last hurrah for that most determined of newspaper publishers, Montgomery.
But, there again, with Montgomery you never know. He just likes running newspapers and somewhere there could be another deal to pique his interest.
High street goes digital
And, finally, at the ultra-local end of the market, the 23-title Tindle Newspapers founded by the late Sir Ray Tindle with his demob money from the Second World War, has gone digital first at last.
Sir Ray was an innovator with his belief in the power of local but he never wholly came to terms with the digital world.
Now his son Owen is staying loyal to the Tindle tradition by continuing to base the company’s newspapers on the high street of market towns while pushing ahead with digital subscriptions.
Another small piece of good news for the newspaper story.
Raymond Snoddy is a media consultant, national newspaper columnist and former presenter of NewsWatch on BBC News. He writes for The Media Leader on Wednesdays — bookmark his column here.