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Telegraph Group joins Gadarene rush with folding of Sunday title into 7-day operation

March 13, 2013

Telegraph 7-day operationThe newspaper is dead, and the Telegraph’s decision to merge its daily and Sunday titles into a 7-day-a-week operation is yet another nail in its coffin. Long live the free press.

By “free press” I mean not the plutocratic oligarchy (absent the Guardian and Observer owning Scott Trust) that maintains a diminishing stranglehold over printed national news, but that other sense of free – “free of charge”. The internet, with Google algorithms in the vanguard, is slowly, inexorably, doing what no politician could ever do: it is breaking down the cartel.

No qualitative judgement is made or implied about this being a Good Thing for the advancement of civilised values. Indeed, on balance, it may well be a bad thing. Just as there is no such thing as a free lunch, so there is no such thing as free journalism. If we are all able, in a matter of moments, to find out what is going on by tapping a few words into a search box at virtually no cost who, exactly, is going to pay for the many hours of sweat, journalistic nous and training that went into crafting the news item in the first place?

It’s a conundrum that digital content strategists frequently explain away by reference to the woolly wisdom of “creative destruction”. Darwinian metaphor is highly misleading, however. Paper dinosaurs may well be on their way to destruction. But there is nothing inevitable about the evolution of a genus of fleet-footed digital mammals to take their place. The ways of evolution are multiform, mysterious and rarely linear. While it is entirely understandable that legacy media institutions should present themselves as the natural guarantors of smooth transition, the reality (with the possible exception of such venerable specialist titles as the Financial Times and Wall Street Journal) may be very different. More likely there will be a period of chaotic evolutionary stasis before something commercially semi-vertebrate emerges anew from the economic goo.

I mention all this after briefly reviewing the latest set of national newspaper circulation figures (ABCs). My, how the mighty have tumbled. The Guardian, for example, shed 5.31% in just one month (February) Admittedly this followed a price hike, but the circulation figure is now around 193,586 which – as MediaWeek reminds us – is The Guardian’s lowest headline figure since records began, in 1949. The paper is worried about having breached a psychological barrier, even after sales were pumped by a recent BBH ad campaign. Not so long ago, I seem to remember that psychological barrier was 400,000, not 200,000.

Guardian print circulation may be in freefall, but its trend is by no means atypical. The Sun on Sunday is down nearly 5% month on month, representing a 41% collapse since Rupert Murdoch phoenixed it last year out of the ashes of The News of The World. The Sunday Express has descended below 500,000; The Mirror is barely achieving 1 million; The Sun itself, not so long ago hovering around the 3 million mark, is now gliding towards 2 million. Only the i – a scarcely economic 20p news digest – managed an increase, and that a miserly 1.45% to just shy of 300,000. Those with a head for historical statistics might like to note that its host, The Independent, now boasts a circulation of no more than 75,000. Even The Sunday Times – psychological barrier once 1 million – is now drifting down to 875,000.

In light of this dismal picture, it is no surprise to find The Sunday Telegraph (February ABC: 429,346) huddling closer to The Daily Telegraph (541,036) for warmth. As with the Sun, Mirror and The Independent 7-day operations that have preceded it, the rhetoric of the Telegraph’s transformation is radical and upbeat. The grim reality – and ultimate rationale for the move – is jobs lost. And with them, irreplaceable experience.

Murdoch MacLennanTrue, the headline figure of 80 print jobs out of 550 editorial staff being culled is not the whole picture. It emerges that Telegraph Group chief executive Murdoch MacLennan (left) will offset some of these losses with 50 “new digitally-focused jobs” – including a new position, director of content who will sit over both editors – and inject £8m into his “number one” priority of completing “our transition into a digital business.”

No matter how many time he incants the mantra “digital business”, MacLennan is unlikely – any more than his rivals who have trodden the same primrose path – to extricate his titles from the financial doldrums. The damage to the brand – particularly the Sunday brand – with its more considered, investigative magazine-like approach – is likely to be considerable. The strategic upside, after an initial financial up-tick, on the other hand is doubtful. Expect to see more circulation decline once disappointed Sunday readers reject the graft.

On the face of it, digital global readers, in whose name all this 7-day stuff is being done, look a worthy prize. For a start, there are lots of them. In January, for example, The Telegraph’s website traffic (by no means the most voluminous among newspaper brands) grew 11% over the previous month to 3,129,599 – the sort of circulation figure that no UK newspaper has been able to boast of for a very long time. But it’s fool’s gold. Digital readers are fickle and rather more likely to be driven by search than brand loyalty. Advertisers have recognised this by tightening their wallets. As former Google CEO Eric Schmidt long ago observed, there’s no better way of turning advertising dollars into cents than migrating to digital publishing. Nor, for the aforementioned reason of declining brand loyalty, are paywalls a viable financial alternative. Unlike the customers of banks, digital readers do have a choice. And they’re using it.

On the other hand, senior newspaper management cannot be seen to be doing nothing. They must inject energy and excitement into a task which, increasingly, looks as suicidal as the rush of the Gadarene swine.

How long before The Observer and Guardian – estimated to be losing about £50m a year – follow the same headlong path?

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Are you a Googler or a Zuckerbug?

January 26, 2011

Think carefully before you answer. There’s a great deal more at stake than the passing satisfaction of an intellectual parlour game.

What we – consumers and advertisers alike – are being asked to debate is the future shape of the internet – the way we approach it, the way we use it. Up to now, it’s been pretty much a search-shaped universe, moulded around the success of its greatest information engine. Now we’re being asked to look at it a different way – the social network way – thanks to the meteoric success of Facebook.

Whoever wins the battle of ideas also scoops the global jackpot. Russian oligarch Yuri Milner and investment bank Goldman Sachs have already made their bet. They stand to be the biggest financial winners when (rather than if) Facebook becomes a publicly quoted company. But what about the rest of us?

Superficially, Google has little to worry about. It has just produced a record set of fourth quarter figures. To those who complain that it is, strategically, a one-trick pony, it can point to success on other online platforms. Video, of course, with YouTube; and more promising still, a potentially market-leading position in mobile with the aid of sub-brands Android and Chrome. What it does not get – CEO Schmidt’s recent enigmatic remarks about developing “serendipitous search – search results searchers didn’t even know they needed” notwithstanding – is social. An upstart rival has excluded Google from the market’s most dynamic area of expansion; from zero in 2004, Facebook’s global reach is now approaching 600 million.

Which brings me to my column, posted on marketingweek.co.uk this week, and its focus on the recently announced change in leadership at Google.

Leadership is one of the paradoxes of this sector. The products and services are highly sophisticated, the organisations which create them highly complex, but the leadership issue is often brutally simple. Continued success frequently comes down to the single-minded vision of a guru-like founder.

Zuckerberg: The $50bn leadership question

Looking ahead, that may well be Facebook’s defining issue as it moves inexorably towards public ownership, with all the grown-up demands that makes on a company’s leadership.

It is a frightening thought that one of the world’s most powerful brands is – and will probably remain – the brainchild of a 26-year-old genius with borderline Asperger’s Syndrome (to take a cue from The Social Network). His obsession with teaching the world to communicate electronically was born out of his own inadequacy at chatting up Harvard girls. Let’s see how he manages in the adult world of the capital markets, where you don’t always get your own way.


Schmidt Apple move means frenemy is now the enemy

August 4, 2009

Eric SchmidtSo, Google chairman and chief executive officer Eric Schmidt is stepping down as a non-executive director of Apple. What took them so long to get rid of him?

Actually, the smarter question is: why was he allowed to assume the position in the first place, back in August 2006?

The conventional answer is that friendship with Apple ceo Steve Jobs mutated into an alliance of interest against the overweening power of Microsoft. The non-exec appointment set the seal on a pincer movement, Apple blunting Microsoft’s forays into mobile operating systems, and Google undermining it on the search and internet open-source applications front.

Tactically, the alliance has had some success. Strategically, it was doomed from the start, because many of the weapons developed by Google in its war on Microsoft also pose a second-degree threat to Apple. Google’s Chrome browser, for example, conflicts with Apple’s Safari, and was under development even before Schmidt took up his Apple appointment.

The balancing act has become progressively more difficult with Google’s launch of a mobile operating system – Android – which challenges the iPhone as well as Mobile Windows, and most recently its introduction of a rival PC operating system, Chrome OS. The last straw on the camel’s back, it transpires, was Apple blocking a version of Google’s Voice application for its iPhone. That, and Federal regulators snooping around the conflict of interest issue.

The problem can be more simply expressed, however. Tribally speaking, Apple is closer to its deadly enemy Microsoft than it is to Google. For Apple and Microsoft, the principle of the intelligent, remote personal computer is fundamental to their business thinking. Google, on the other hand, is all about internet server-based technology and open-source, as opposed to proprietary, software applications.


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