Media Business

OFT clears Lebedev takeover of Independent

Posted by Press Gazette on 17 March 2010 at 16:14
Tags: Media Business, National Newspapers, Newspapers

The Office of Fair Trading has cleared the likely takeover of the Independent and Independent on Sunday by the Russian billionaire, and owner of the London Evening Standard, Alexander Lebedev.

The OFT issued a mergers update this afternoon:

“The OFT has decided, on the information currently available to it, that a relevant merger situation, under the provisions of the Enterprise Act 2002, has not been created in the following merger(s):

“Anticipated acquisition by Lebedev Holdings Limited of The Independent and The Independent on Sunday.”

The move follows owner Independent News & Media filing a submission over the proposed deal last month. (more…)

GMG set to write-down Emap investment by at least £100m, report

Posted by Dominic Ponsford on 15 March 2010 at 11:07
Tags: Journalism, Media Business, Newspapers, Regional Newspapers

Guardian Media Group is set to write down the value of its investment in Emap to the tune of between £100m and £200m, the Sunday Times reports.

GMG invested in Emap along with private equity company Apax in 2007 - buying the business to business publishing arm of the magazines giant for £1bn. GMG put up £300m of the purchase price.

GMG told the Sunday Times: “Any impairment of our investment would be an accounting technicality, a paper loss with no impact on the company’s cash position.”

It follows a similar move by Apax in June 2009, when it wrote-down the value of its stake in Emap by 50 per cent, writing-off of the £300m cash part of its investment. The remaining third of the business was paid for through borrowing by Emap.

It all means that if GMG and Apax were to sell Emap now, they would only recover a fraction of the money they spent. All that could change if the economy bounces back, and Emap’s profit margins have proved to be pretty robust so far.

Peter Kirwan did a detailed blog post on this in June when, incidentally, he predicted that GMG would probably have to write down the value of its Emap holding.

Freddy to take the Johnston out of Johnston Press

Posted by Dominic Ponsford on 8 March 2010 at 16:23
Tags: Media Business, People, Regional Newspapers

Freddie Johnston is to retire next month after 51 years on the board of Johnston Press.

It will be the first time in 243 years that there has not been a family member on the board of the company, the Sunday Times reports.

Johnston, 75, is currently a non-executive director. In the 2008 Sunday Times rich list he and his family were said to be worth £115m.

This correspondent recalls meeting Freddy Johnston when he was a reporter on the Johnston Press-owned Battle Observer. Johnston made a habit of visiting every member of staff at the company each year, saying hello and shaking them by the hand.

He had a colleague with him carrying a big leather bag, I recall, which we hacks speculated was full of cash. Back in the late 90s/early Naughties Johnston Press’ profit margins were approaching 40 per cent - very little of which filtered down to the reporters. NCTJ qualified graduates started on less than £8,000 a year.

Nowadays Johnston Press has deep problems financially, shackled by the huge cost of a buying spree which led to it becoming the UK’s second biggest regional newspaper publisher. More on this on Peter Kirwan’s Media Money blog.

Peter Sands: We must not let the Regional Press Awards disappear

Posted by Peter Sands on 8 March 2010 at 11:39
Tags: Journalism, Media Business, National Newspapers, New Media, Newspapers, Regional Newspapers

The great and the good of national newspaper journalism will be applauded at a glitzy dinner at the Grosvenor House Hotel later this month. It will be a celebration of a vintage year for British journalism.

But for their regional cousins there will not even be a beer and bowl of peanuts in the backroom of the Cheshire Cheese. After 22 years the Regional Press Awards have been “rested” - a decision that indicates the gulf that appears to be growing between national and regional papers.

I had been optimistic that the awards would go ahead. The early signs were good with one of the big groups, who had not entered last year, saying that things had eased up and they would be back in the fold.

But last week others said that, given the economic circumstances, their papers would not be taking part. Their absence would have made the awards a nonsense, so organisers Wilmington had no choice but to call the whole thing off.

I am sure I am not alone in being saddened by the decision. For the last four years I have been chairman of the judges in the awards. Fifty independent judges, me included, give their services for no reward other than knowing they are supporting the industry they have grown up in.

Editors support the awards too. But when you are cutting staff, how can you justify sipping over-priced champagne in a swanky London hotel? It seems the combined cost of a £35 entry fee and a £130 ticket to the event were just too prohibitive.

I know that some newspaper managements also believe the awards are a distraction, a bit of irrelevant back-slapping and that they have no tangible benefits. I don’t agree. The regional press has now become the only branch of the media not to have its own national awards.

Ask those in film, television, magazines, national newspapers or any other creative industry if they feel their awards are an irrelevance. Apart from anything else the awards send out a message, both internally and externally, of an industry confident in itself. Their cancellation has already allowed commentators to refer to “a sad reflection of the parlous state of the sector” and to observe that the decision should “restore some gloom”.

If the regional press doesn’t celebrate the excellence that runs through its newspapers, applaud the journalists who go that extra yard every day, recognise the editors who invest in off-diary work and innovation then who will?

I am particularly uncomfortable with the suggestion that we just applaud excellence during the good times. Those who work hard to maintain standards when the going gets tough deserve to be honoured.

So what next? Maybe the answer is to scale the event down, hold it online, combine the regional and national awards (as they used to be) or something else altogether. What must not happen is for them to disappear altogether.

There will now be discussions on what can be done to ensure that the awards are resurrected next year. If you have any suggestions let me have them and I will ensure they get heard.

Peter Sands blogs here at Sands Media Services.

Telegraph.co.uk to stream live coverage of the World Indoor Athletics Championships

Posted by Press Gazette on 3 March 2010 at 09:25
Tags: Media Business, Mobile, National Newspapers, New Media, Newspapers, Online

The fever with which eight national newspapers dived in to stream England’s World Cup football qualifier in Ukraine following the collapse of the broadcaster Setanta last year has yet to be replicated on such a scale. (Let’s not dwell here on the technical troubles that blighted much of that match).

Despite this national newspaper websites are growing increasingly accustomed to showing sports packages on their websites.

The Guardian is just one which shows highlights of Premiership rugby and other sports.

Telegraph Media Group has now proved that it is hungry to add regular live action to the sporting reflection that has been more traditional newspaper fare through live streaming sports which don’t have such a big impact when broadcast on TV. (more…)

ITV return to profit signals thaw in UK media recession

Posted by Dominic Ponsford on 3 March 2010 at 08:18
Tags: Broadcast, Media Business, Television

UK broadcaster ITV returned to profit in 2009 in what will be seen as a positive sign for the broader UK media.

And the group said that advertising revenues were already up 7 per cent in the first quarter of this year, and were expected to be up by 15-20 per cent in April.

Revenue for 2009 fell 7 per cent to £1.9bn. The group made a pre-tax profit of £25m after a loss of £2.73bn in 2008.

Read the full ITV results announcement here.

Lebedev will pay £1 for the Independent, claims report

Posted by Press Gazette on 1 March 2010 at 11:32
Tags: Media Business, National Newspapers, Newspapers, People

Alexander Lebedev will pay a token £1 later this week to take control of the Independent, according to a report in the Sunday Times.

The price is the same as a newsstand copy of the Independent – and also the same price he paid for the London Evening Standard last year. (more…)

BBC Trust chairman’s statement following reports of deep cuts resulting from strategic review

Posted by Press Gazette on 1 March 2010 at 08:05
Tags: Broadcast, Consumer Magazines, Magazines, Media Business, New Media, Online, Radio, Television

Following reports last week suggesting the BBC was about to close two radio stations, cut the size of its website and dispose of its magazines, BBC Trust chairman, Sir Michael Lyons, made the following statement:

“In its first three years, the Trust has focussed on addressing the concerns of audiences and re-shaping the BBC. In particular this has meant working to ensure the BBC delivers genuinely distinctive content, serves all audiences across the UK, and provides value for money for licence fee payers. (more…)

INM refers planned sale of Independent to the OFT

Posted by Press Gazette on 25 February 2010 at 17:07
Tags: Media Business, National Newspapers, Newspapers

The likely sale of the Independent and the Independent on Sunday to Alexander Lebedev seemed to move a step further this afternoon with confirmation that a submission has been lodged with the Office of Fair Trading over the proposed deal. (more…)

Report: Manchester Evening News enjoyed Scott Trust protection until 1992

Posted by Dominic Ponsford on 22 February 2010 at 09:36
Tags: Media Business, National Newspapers, Regional Newspapers

The Independent reports today that up until 1992 the Manchester Evening News had similar protection under the terms of the Scott Trust that The Guardian still enjoys.

The sell-off by Guardian Media Group of its regional newspaper business earlier this month was done to ensure the continued survival of the journalism of The Guardian “in perpetuity”, as the Scott Trust - which owns GMG - insists.

But the Independent notes today that the original deeds of the Scott Trust from 1936 also extended this duty of care to the MEN. The Indy says that the MEN was only removed from the trust’s responsibility when its rules were re-written in 1992 following the purchase of The Observer.

The MEN has been closely linked to the Manchester Guardian, and then The Guardian, for some 140 years. For much of that time the MEN profits bankrolled The Guardian’s losses.

One MEN staffer who spoke to me last week said: “We feel sad and betrayed by what The Guardian have done, but as far as we are concerned The Guardian is history and we are moving on to a new future.”

New owners Trinity Mirror are currently proposing to relocate the MEN, and its associated weeklies, outside the city centre of Manchester to Oldham.

Staff are having weekly meetings lead by finance director chief operating officer David Sharrock, who is to be managing director of the business under new owners Trinity Mirror.

Although there are obvious concerns over more job cuts, one MEN insider told me: “We feel there is no fat left to cut after the heavy job cuts we had last year. We are an extremely lean and efficient machine and we are already back in profit. We are hopeful that when Trinity Mirror have had a close look at what we are doing they will find there is a lot that their other businesses can learn from us.”

Read Press Gazette’s special report on the sale of Guardian Regional Media here.

OFT to examine Trinity Mirror’s takeover of Manchester Evening News

Posted by Press Gazette on 17 February 2010 at 16:39
Tags: Media Business, National Union of Journalists, Newspapers, Regional Newspapers

The Office of Fair Trading has opened an invitation for interested parties to comment on whether it should refer Trinity Mirror’s planned takeover of Guardian Media Group’s 32 regional newspapers, including the flagship Manchester Evening News, to the Competition Commission for investigation.

The NUJ has already raised fears about the “diversity of information” once any takeover goes through. It has said it’ll raise the issue with the Department of Business Innovation and Skills.

Lebedev up to his old tricks as Independent journalists face redundancy terms threat

Posted by Dominic Ponsford on 17 February 2010 at 12:42
Tags: Media Business, National Newspapers, Newspapers

Independent journalists have had “a gun held to their heads” amid the ongoing wrangling over whether the titles will be sold to Alexander Lebedev, reports Stephen Brook on Media Guardian.

He reports that their “generous redundancy terms” would need to be cut from four weeks per year of service to two weeks in order for Lebedev to agree to buy the titles.

Those “generous” reudundancy terms aren’t any better than those being offered to departing Guardian journalists, I’ll venture, which were four weeks’ pay for every year’s service up to £95,000, plus three months’ pay in lieu of notice - the last time I checked. (more…)

Standard starts charging in some newsagents

Posted by Dominic Ponsford on 15 February 2010 at 13:28
Tags: Media Business, Newspapers, Regional Newspapers

The Evening Standard is experimenting with selling the paper in newsagents located in more far-flung parts of its distribution area, The Guardian reports.

The price charged is between 20p and 50p at the discretion of the newsagent reports Steve Busfield, who is helping to mind the shop on the Greensalde blog while Roy is away.

One of the benefits touted by the Standard of being free was that it made for a much simpler distribution system which resulted in massive cost-savings.

So selling it in some places might be more trouble than it is worth in pure financial terms. But it does remind free readers that they are getting a bargain, and probably also plays well with advertisers.

NUJ to sound out Johnston Press staff on company-wide ballot

Posted by Press Gazette on 12 February 2010 at 10:47
Tags: Media Business, National Union of Journalists, Newspapers, Regional Newspapers

The National Union of Journalists has started sounding out members on Johnston Press newspapers across the UK to ask if there should be a company-wide ballot on possible industrial action in protest to proposed pension changes.

Senior figures from the NUJ meet with managers at Johnston Press last month for talks about the publishers plan to close its final pension salary scheme. (more…)

GMG Regional sale reaction: ‘It’s the deal of the decade for Trinity Mirror’

Posted by Dominic Ponsford on 10 February 2010 at 10:08
Tags: Media Business, Newspapers, Regional Newspapers

For regional press chief doom-mongers, Enders Analysis, the sale of GMG Regional Media for £7.4m is a “win, win”.

Douglas McCabe of Enders is quoted on page two of today’s Guardian: saying: “Trinity Mirror gets the benefits of synergies and cost savings in the north-west and south. GMG gets an opportunity to focus on its core business.”

But Lorna Tilbian, the eminent media analyst at Numis, told the Daily Telegraph this was the “deal of the decade” for Trinity Mirror chief executive Sly Bailey.

Analysts told the Financial Times that the deal is a “fantastic” one for Trinity.

Paul Gooden, analyst at Royal Bank of Scotland, told the FT: “The disposal price of £44.7m looks very low, particularly as only a small proportion of it is cash.”

Another un-named analyst told the paper: “Trinity are known as the best cost-cutters in this market and GMG Regional has an inefficient cost structure.”

Ian King, writing in The Times, notes that the MEN has every bit as a distinguished a record as The Guardian itself. Once Britain’s biggest and most influential regional newspaper, it was a vocal critic of Hitler in the run up the Second World War - he notes.

He writes: “In recent years, hit by The Guardian’s need to cut costs and the structural decline of the regional press, the paper has struggled. It was not helped by a confusing distribution system, which included giving the paper away on certain days of the week and selling it on others.

“It was an undignified way to treat a distinguished newspaper. A takeover by Trinity Mirror is no panacea. However, for many MEN staffers, the new owners could scarcely be worse than the old ones.”

David Prosser at The Independent says the deal “yet another indication of” GMG’s “determination to bet the house on all things digital”.

He says: “It has sold a profitable group of local newspapers (albeit with profitability in decline) in order to subsidise its loss-making national newspaper division, which is obsessed with the idea of a multimedia future and, specifically, the view that charging for online content is the wrong way to proceed.”

Crticising GMG’s heavy investment in an online future which has yet to turn a profit for The Guardian he says: “the media group can only go on selling off the family silver in order to finance unprofitable new adventures for so long”.

You can read all Press Gazette’s coverage of the GMG Regional sell-off here.

No he’s not: Egyptian billionaire set to join Lebedev in Independent purchase update

Posted by Press Gazette on 3 February 2010 at 09:14
Tags: Media Business, National Newspapers, Newspapers

15:10 Update: Contrary to earlier reports it turns out a rich Egyptian might not by buying into the Independent after all (from the Guardian):

The Egyptian businessman Samih Sawiris has denied that he is involved in talks to buy the Independent newspapers with London Evening Standard owner Alexander Lebedev.

Geordie Greig, the Evening Standard editor, also denied that Sawiris was involved in the talks.
Sawiris said today that the first he had heard of his supposed involvement with the Independent titles was from MediaGuardian.co.uk.

“I had previously been unaware that the Independent was even up for sale, and had certainly never expressed any interest in buying it or being involved in buying it. If I had that much spare money, I would use it to buy a boat, not a newspaper,” he said.

This is the story that came out earlier:

Former KGB agent turned owner of the London Evening Standard, Alexander Lebedev, is trying to bring a wealthy Egyptian family in on his proposed takeover of the Independent newspapers, a report has claimed.

Lebedev is believed to have told associates that he expects Egyptian billionaire Samih Sawiris to invest in the Independent and Independent on Sunday – the men are already understood to be partners in a chateau development in Switzerland.

Sources close to the deal told the Guardian that the Evening Standard owner was trying to persuade the Sawiris family to join him in his latest UK media venture.

The source said today that Lebedev and Samih Sawiris had become close and were talking about other business projects in Russia and elsewhere, including a low-cost housing development.

There was no immediate response from Lebedev today to inquiries from MediaGuardian, but a source close to the Russian dismissed the speculation.

The billionaire, who in exclusive non-binding talks with Independent News & Media over the sale of the Independent and Independent on Sunday, has given few details of his offer for both titles.

Negotiations between Lebedev and INM are due to conclude on Monday, 15 February.

BSkyB six-month profits balloon to £358m despite recession

Posted by Dominic Ponsford on 28 January 2010 at 08:31
Tags: Broadcast, Journalism, Media Business, New Media, Television

Revenues at BSkyB rose to eye-boggling proportions in the second half of this year despite the worst recession in history - proving that there is plenty of money in the right paid-for content.

Total revenues on the six month to December rose 10 per cent to £2.9bn and pre-tax profits were up from £276m to £358m.

More on this story from the FT. Here’s the full interim results statement.

Revenues in the six months to December 31 rose 10 per cent to £2.9bn, towards the top end of analysts’ expectations, while pre-tax profits rose from £276m to £358m