Restructures lay the foundations for the industry’s future

In most cases, it was an overreaction. Instead of positive steps towards the future of publishing, the moves – particularly at Fairfax – were viewed as the end of the world as we know it.

Behind both restructures, there was a one simple motivation: to lay the foundations for the transition from newspaper companies to newsmedia organisations with a sound digital future.

For this to happen, some economic realities had to be addressed. Like all media companies, News Ltd and Fairfax had been hit by falling ad revenues precipitated by a lack of consumer confidence that beset the retail sector – a condition exacerbated by the gradual march of the advertising dollar from print to digital.

As digital dollars at this stage do not compensate for the drop in print revenues, this meant costs had to be cut, as well as restructuring.

This, of course, is little comfort to the employees at both companies – 1,900 at Fairfax and unknown at News Ltd – who regrettably will lose their jobs over the next few years.

News Ltd had ventured a fair way down the path towards centralised newsrooms before the long-awaited announcement by chief executive Kim Williams. The company also made no secret of its desire to strengthen its position in pay-TV and enhance its digital position through acquisition.

To some extent, Mr Williams’ announcement was something of an anti-climax.

At Fairfax, it was a different story. The company effectively laid out a plan for its survival on a scale that surprised many – leading both editorial and printing staffs to consider industrial action.

Strikes will not resolve the need for restructuring, but Fairfax employees have every right to be angry. This, however, should not be directed entirely at current management, who had little choice but to pull the trigger on the gun that had been placed in its hand by the inaction of previous administrations.

As Michael Smith, a former editor of The Age observed: “It probably would have been much less painful if these sorts of things had been done gradually over the last 15 years rather than trying to do them all at once, when the writing has been on the wall for a long time.”

Make no mistake, the Fairfax review – as it was called internally – is a document that deals with harsh realities.

However, the proposal to downsize The Age and The Sydney Morning Herald to a compact, or tabloid, size next March, and to close its plants at Chullora and Tullamarine and outsource its printing to its regional presses, are economic decisions – and should not be taken as a judgement on the immediate future of newspapers. Nor does it mean quality is compromised.

Politicians who have questioned the moves; as well as equating the dominance of mining magnate Gina Rinehart on the Fairfax share registry to a weakening of democracy by robbing the publisher of its independence, should take a cold shower.

While digital may be the way of the future, newspapers remain a strong force among consumers, providing a solid platform for advertisers and readers.

The latest Audit Bureau of Circulations figures show metropolitan newspaper sales of more than 15 million per week – an enviable number of eyeballs for any media platform.

Ian Moore was the founding editor of the Sunday Herald Sun and a former editor of The Sunday Telegraph

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