Examination of Witnesses (Questions 580
- 599)
WEDNESDAY 10 OCTOBER 2007
Mr Lionel Barber
Q580 Baroness Thornton:
Do you have two different sorts of—
Mr Barber: We have always charged for our content.
Q581 Baroness Thornton:
I am interested in this because The Guardian is
free, so I am interested in seeing how you make that work.
Mr Barber: We are making it work. In fact, we
have just announced a change in the business model whereby we
will be making a certain amount of content free every month and
then we will have a registration kick in. Each user is allowed
to view up to five articles per month without a financial commitment,
registered users are allowed a further 30 articles per month without
charge, then you have to subscribe and then you will get as many
articles as you wish for a monthly fee. I should say we have just
over 100,000 paid subscribers who pay for our content, but we
have recognised the need to open up the site a bit more so people
can taste the content.
Q582 Chairman:
Would The Wall Street Journal also charge?
Mr Barber: They do charge. They have charged
for more than a decade.
Q583 Chairman:
When we were in New York, The New York Times had just changed
their policy on this and I think have gone entirely free.
Mr Barber: They wanted to charge for columnists
and they reversed that.
Chairman: Am I right?
Baroness Scott of Needham Market: Yes.
Q584 Chairman:
I think I am right, I think they are now free for everything.
Mr Barber: They are but I am just saying they
did want to.
Q585 Baroness Thornton:
That is because they cannot make money on it, presumably.
Mr Barber: That is your conclusion.
Q586 Baroness Thornton:
My comment, yes, and that you can and that is very interesting.
Do you make money on it?
Mr Barber: Yes, we do.
Q587 Baroness Bonham-Carter of Yarnbury:
Picking up on one thing you said in answer to a previous question.
Did you say you had one set of people working on both your website
and your newspaper?
Mr Barber: We have 500 journalists—by
the way, that is an increase of 10% in our staff over the last
10 years—and they all work seamlessly for FT.com
and the newspaper.
Q588 Baroness Bonham-Carter of Yarnbury:
You have never been concerned that affects the quality of the
journalism because they are having to, what we call in the television
world, multi-skill?
Mr Barber: We like flexibility at the Financial
Times. We have not noticed any deterioration in quality. In
fact, as I said, the page views have gone up, the circulation
of the newspaper has gone up, that does not suggest to me a fall
in quality, far from it. Actually, what we offer is something
different and people want it.
Q589 Baroness Bonham-Carter of Yarnbury:
We have been hearing from other newspapers that there is increasing
pressure to make their papers less news driven, more magazine
style, is this something the FT has come to in any way
or feels any pressure on?
Mr Barber: I will let the competition speak
for itself but that is not a view which I share in any way. I
think it is more important than ever that informed, experienced
journalists judge what is newsworthy and explain facts and explain
the news. Our job, if you like, is to be the "Filtering Times"
as well as the Financial Times to filter out what is important
and relevant to an audience of sophisticated wealthy readers around
the world, people who make decisions. I am very happy to say I
am a news man and the FT believes in news and news is not
dead.
Q590 Baroness Bonham-Carter of Yarnbury:
One of the other things we discovered in America was this strict
demarcation between the news editor and the editorial editor.
Does the FT have a similar system?
Mr Barber: No, we do not. We have never adopted
the American system whereby the managing editor controls the news
pages and the editorial page editor controls opinion pages, I
am responsible for both.
Q591 Baroness Bonham-Carter of Yarnbury:
What is your reasoning behind that?
Mr Barber: It is not my reasoning, I am just
following tradition. That has always been what the FT editor
has been responsible for and I did not see any reason to change
it when I took up my appointment. I chair the lead of conferences
where we decide the editorial line on issues like Europe, the
election or Northern Rock, the Bank of England governance performance,
et cetera, as well as judging the front page.
Q592 Baroness Bonham-Carter of Yarnbury:
You have no concerns that comment can pervade news in a way which
is maybe not the best for the reader?
Mr Barber: I read the postbag three days a week
and I have not had any letters to that effect over the last two
years and it is not a charge which is levelled against the Financial
Times. I think the question of trust in our judgment on what
is important is sacrosanct, so we do not allow comment to intrude
in the news, or if I do see it or hear about it, it is removed.
Q593 Baroness Bonham-Carter of Yarnbury:
You believe absolutely in impartiality in the news?
Mr Barber: We do our best every day.
Q594 Chairman:
It is fair to say, is it not, that because you are in this specialist,
I think you said niche, area, but very broad specialist area,
you live or die by the accuracy of your information and you are
special as far as that is concerned compared with perhaps more
general newspapers?
Mr Barber: Yes, that does set us apart from
the rest of the field, particularly in this country. Accuracy
is absolutely paramount. I also think it is the selection of news
and the presentation of news. You could have a very accurate story
about a totally trivial matter and put it on the front page and
that would not necessarily do the readers a service. These are
questions of judgment which we wrestle with every day throughout
the day, particularly between 5 and 7 o' clock in the evening.
Q595 Baroness McIntosh of Hudnall:
Mr Barber, you touched on the question of advertising revenue
earlier. You said that it had gone up, that there was a sort of
buoyancy in the whole picture that you were giving us about the
way the newspaper is growing. What, in fact, is your dependency
on advertising revenue as against other income streams? Where
does it come from and where does it go to? Is it mostly still
in the newspaper? Is it going to the website more than it did
and do you predict that it will in the future?
Mr Barber: I would not wish to give the Committee
the wrong impression. I am well aware of the competition out there
in terms of print media and on-line, so there is no room for complacency,
but I am suggesting that right now—and the economic conditions
have been very favourable, of course—the Financial Times
is performing quite well. To answer your question more directly,
we get 70% of our revenue from advertising, 25% from circulation
and 5% from other sources. I think, and my colleagues tell me,
we would still like to be looking at that kind of figure for advertising
revenue in the future. What we are looking to do is strengthen
the other services that we offer to our niche audience. Clearly
FT content is valuable, what could you do to package it
to resell it these ways, but also massive areas such as conferences,
which are increasingly important, where you can bring top class
journalists like Martin Wolf to bear and bring people who would
pay a lot of money to go to those conferences, are a useful revenue
stream.
Q596 Lord King of Bridgwater:
A quick question on your advertising. As you may have heard, The
Mail on Sunday editor said 50% of his paper was advertising.
I imagine the rates in the FT are considerably higher.
I think 60% also of their income came from advertising, so yours
is much higher at 70%. Is it because your rates are much higher
or what percentage of advertising do you have in the FT
in paper, on page?
Mr Barber: It depends on whether it is a good
day like today. I would suggest that our advertising rates are
considerably higher than others.
Q597 Lord King of Bridgwater:
As editor, he made it quite clear he sets certain standards as
to what he is prepared to accept as the amount of advertising
in his newspaper without altering the character of the newspaper.
Do you set a standard?
Mr Barber: I have an idea of what would be a
less than acceptable proportion, but I have never been in that
position where I would have to question or turn away advertising.
You have to remember that our ads tend to be rather substantial
full page ads and only fairly serious people can afford those
ads.
Q598 Chairman:
Is your editorial policy ever influenced by those who advertise
with you?
Mr Barber: Never.
Q599 Baroness Howe of Idlicote:
Mr Barber, thank you very much for a very interesting presentation
so far. You described yourself as niche, global, a huge percentage
of revenue coming from advertising, not much going on in the UK,
perhaps, compared with the rest of the world, maybe you will want
to do rather more in the UK over time. Thinking ahead to newspapers
generally, and you are one of them, who do you really regard as
your competitors? Is it this very specialist market or is it the
whole of the print industry and the way they are shaping up from
the use of the Internet and so on? Where do you expect it to be
in 10 years' time? Can I make one general point because listening
to you, we have the BBC and public service broadcasters and they
get a certain amount of revenue in order to be public service
broadcasters, it seems to me that what you are saying is you are
doing this sort of independent, trustworthy, all totally reliable
and you are doing it all on the market, am I drawing the right
conclusion?
Mr Barber: Not entirely, Lady Howe, but perhaps
I can explain. Can I correct you on one matter. We are not neglecting
the UK in terms of our advertising base, it accounts for more
than 50% by value, it is really important.
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