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Supplementary written evidence from the Newspaper Society (FLM 38)
· Regional and local media - nearly 1300 core newspapers, 1200 websites, 700 magazines + ultra local titles, 45 radio and 2 TV stations. (NS Annual Industry Survey)
· 82% of UK Adults read a regional newspaper in print, over 40 million adults. Over 24 million unique users access local media websites. Readership of regional and local newspapers in print is growing (+1.6%) (BMRB/TGI) and many groups report their online audiences are growing at an annual rate of 40%.
· The local media sector employs 38,000 people, with nearly a third (30%) of these editorial staff. (NS Annual Industry Survey)
· As a source of local news and information, local newspapers are three times more popular than the next medium BBC TV news. (YouGov 2007) Local newspapers and their associated websites are 49 per cent more trusted and relied-upon than the nearest medium, commercial TV. (the wanted ads III 2007, TNS)
Difficulties · Industry facing both
structural and cyclical change. Critical problem is the latter - sudden
advertising downturn caused by the recession (property, motors, jobs - main
sources of revenue, barometer of
· Severity of downturn proving enormously challenging for all media sectors - local media no exception.
§ Regional press print advertising was down 15.8% year on year (source: Advertising Association 2008 v 2007). Classified advertising - most important revenue stream for regionals and a barometer of the wider economy - particularly badly hit: jobs advertising down 19.4%, motors down 16.8%, property down 31.5% (source: Advertising Association 2008 v 2007).
§ Challenges: tough competitors eager to take a slice of the local markets we serve well: Google, Monster, Gumtree, and public sector: BBC and local authorities (local council newspapers and websites increasingly competing for readers and advertising revenues. Public right to know issue at stake). Independent local media services available or being developed: classified online, blogging, videostreaming. Distinction between fair and unfair (publicly-funded) competition.
§ Loss of revenue means painful decisions as for many industries globally - closure of loss-making titles, redundancies, pay freezes. 70 titles closed in past year (all but 7 were free weeklies). 70 out of nearly 1300 core titles = around 5% of total. Ofcom has pointed out that most of closures were marginal free titles occupying second or third position in local market, and should be considered in context of significant expansion of free titles in 1980s (ie,rationalisation).
§ Editorial jobs within the local media sector are being protected wherever possible. The industry's workforce reduced by around 8% in 2008 compared with 2007, while editorial numbers reduced by 5% over the same period. The job types hardest hit are commercial/advertising/ marketing, production, clerical/admin and distribution. The proportion of editorial staff to the total has increased (from 27% in 2006 to 30% in 2008) There has also been major investment in editorial systems and training in video journalism etc as part of the transition to integrated multimedia newsrooms.
Reasons for cautious optimism § While regional press print advertising revenues were down 15.8%, their internet advertising revenues (although still tiny in revenue terms in comparison with print) grew by an estimated 19% in 2008. Online recruitment advertising is growing at an even faster rate for local newspaper websites (+17.1% yoy) than for the big specialist recruitment sites like Monster, Jobsite and Fish4 (many of which are owned by newspaper companies) (+5.6% yoy). Local newspaper websites have positioned themselves well to capture advertising migration and are quietly stealing share from the specialist recruitment sites. Demonstrates effectiveness of local newspaper website advertising. Yet government continues to divert advertising out of local media and onto government-owned websites and publications (eg, NHS e-recruitment, local councils).
§ The number of people buying local newspapers is also down but not as badly affected as ad revenues. People are still buying and reading local papers as the only reliable source of local news and information. People also now accessing their websites in ever greater numbers - particularly important during crises (eg, floods, snowstorms). Local newspaper print circulation down by 5.7% and print readership remarkably stable but internet traffic to local newspaper websites up by around 25% in 2008.
§ Local media has a key role to play in Digital Britain. Investment by local newspaper companies in recent years into new platforms, special interest and ultra local publications, converged multimedia newsrooms, video journalism, UGC, mobile sites and other digital and print innovations means that local newspapers are now a multimedia communications business: internet, video-streaming, podcast, text services, all driven from the trusted newspaper brand and focused on core business of local community news and information. Reaching more of the population than ever before as well as rapidly growing their online advertising revenues. Well positioned to supply PSB (eg, ITV regional news services.)
Government action The Government can help. The NS has been asking for the Government to act on these areas as a matter of urgency: 1) The increasing threat posed by local authority publications, websites and broadcast services purporting to offer 'independent' local news and competing with local media for readers and advertising revenues;
2) The proposed removal of legislative and other obligations to place statutory notices in regional and local newspapers (Power of Information Taskforce recommendation 11);
3) The sharp decline in government advertising in local media despite universal acknowledgement by politicians of their importance to communities and the fact that they are better read and more trusted than other media.
4) Changes in the approach and guidance on local media markets and regional media transfers and mergers. Relaxation of cross-media ownership controls over local newspaper/broadcast media to allow full development as multimedia businesses.
Summary § Local media companies can come through the current economic difficulties if they are given the freedom to innovate and develop.
Local Authority Publications
NS audit of 436 local authorities across
· Most councils publish their own newspaper or magazine · Many have similar names/layout to independent local papers · Half of · 90% of · 54% of council publications outside
Examples: · Tower Hamlets publish the weekly newspaper East End Life. Its losses are believed to cost council taxpayers £250,000 per annum
· Barking & Dagenham's fortnightly newspaper, The News, replaced its monthly publication in May 2009. It is believed the publication has six staff members and is actively targeting advertising from the commercial market. Specially branded 'The News' pick-up bins have been cemented into the pavement outside the tube station.
· Thurrock Council is considering a fortnightly
newspaper to be distributed free to every household in
· Greenwich Time is a competitive weekly free newspaper published by the council. It is estimated to make an annual loss of £300,000. It has also built permanent pick-up bins for its own newspaper.
· The fortnightly council-run Lambeth Life is
believed to have the highest distribution of any council newspaper in
· NS is aware of a local council which has reneged on a signed advertising contract with a struggling local paper. As a direct result, the publisher has now closed the newspaper (commercially sensitive so it is not possible to name the title or council).
LGCommunications research (The Impact of Council Publications: May 2009):
· 94% of councils produce a magazine or newspaper · 64% of council publications carry advertising · 16% of local authorities carry statutory notices in their own publications · 85% of council publications have news pages · 71% of council newspapers have local events listings · 27% of local authorities think their publication has the look/tone of a quality tabloid
Frequency: · Councils publishing 7-12 times a year are most
likely to be
· Less frequent publications have more impact for most councils with the optimum level of publication no more than quarterly.
· Residents are more likely to be informed about council services and benefits, satisfied with the council and feel it offers value for money if the publication comes out once or twice a year and less likely if it is published 7-12 times a year.
LGA submission to Whittingdale Committee:
"A typical council magazine is distributed three or four times a year, and 98% of councils say they produce their magazine to provide information about public services."
"A quarter of council magazines carry no advertising at all, and a third comprised less than 10% advertising." [Therefore three-quarters do carry advertising and two-thirds comprised more than 10%]
"Over half of respondent councils produce a magazine only three or four times a year, and 79% up to only 6 times a year."
"The LGA and local councils support a successful and vibrant local media. It is essential for local democracy than journalists scrutinise the workings of local councils and help hold elected representatives to account. 20% of councils in areas with struggling local papers have taken action directly to help their local paper, usually through taking out longer term advertising contracts or running campaigns in the local press."
Included in statements of support from LGA survey:
"We work closely with our local media. We don't do
news, they do. They don't do Council information, other than when it's news, we
do. We don't take advertising, they do. It's a good working relationship that
we both understand." - District, East of
Current reviews:
Audit Commission inquiry into council newspaper advertising Local Authority Publicity Code Killian Pretty review of planning applications Power of Information Taskforce (recommendation 11)
Government must acknowledge the impact (and contradictory nature) of
its own advertising strategies, particularly in current downturn. Government is
the
One obvious solution, backed up by NS and LGA survey findings, is that strict guidelines be issued to all local authorities to ensure their publications are quarterly or less frequent, that their publications and websites don't take advertising or statutory notices, and that they focus on providing information about council services rather than general local news or non-council events listings. Councils should be encouraged to use the local media, not compete with it. Appropriate partnerships between councils and independent local media should be encouraged (council meeting webcasts on local newspaper sites, commercial printing & web design services, media & advertising advice). The Publicity Code should be updated to reflect this. Any recommendations to relax the obligation to place statutory notices in local newspapers must be rejected.
July 2009 |