Supplementary written evidence submitted
by the Newspaper Society
— Regional and local media—nearly
1,300 core newspapers, 1,200 websites, 700 magazines + ultra local
titles, 45 radio and two 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% 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 UK economy).
— 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 seven 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:
(i) 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;
(ii) The proposed removal of legislative and
other obligations to place statutory notices in regional and local
newspapers (Power of Information Taskforce recommendation 11);
(iii) 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; and
(iv) 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 UK
(April 2009) found that:
— Most councils publish their own newspaper
or magazine;
— Many have similar names/layout to
independent local papers;
— Half of London boroughs publish monthly
or more frequently;
— 90% of London borough publications
take advertising; and
— 54% of council publications outside
London contain non-council news.
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 Thurrock. It would pull all its advertising out of local papers,
particularly the Thurrock Gazette, and hire three more
staff, including an ad manager to promote The News to potential
advertisers. The council estimates it will lose £100,000
a year but true losses could be three times that amount.
— 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 London. Minutes from the council meeting in May show
the council is considering whether to increase third party advertising
and the number of editions.
— 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; and
— 27% of local authorities think their
publication has the look/tone of a quality tabloid.
Frequency:
— Councils publishing seven to 12 times
a year are most likely to be London boroughs (41%) and unitary
authorities (35%);
— Less frequent publications have more
impact for most councils with the optimum level of publication
no more than quarterly; and
— 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 to 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
six 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 England.
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 UK's biggest advertiser.
It repeatedly emphasises the vital democratic role of local newspapers,
its high readership levels and its effectiveness editorially yet
has been systematically withdrawing its advertising from local
papers for years, particularly at a local government level (including
current proposals to allow statutory notices to be removed from
local papers.)
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
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