Examination of Witnesses (Questions 700
- 718)
WEDNESDAY 17 OCTOBER 2007
Mr Simon Kelner and Ms Imogen Haddon
Q700 Bishop of Manchester:
How near are you to coming into that harbour?
Mr Kelner: We have had moments when we could
see the little lighthouse at the end of the harbour walls but
the shipping forecast has not been too good recently.
Q701 Bishop of Manchester:
Let us get the figures if we can. In terms of the income that
you get, what is the proportion that you get from advertising?
What proportion do you get from sales?
Mr Kelner: As I said in answer to a previous
question, it varies from time to time. The advertising industry
is very changeable in terms of whether the market is good or bad.
It is roughly fifty fifty.
Q702 Bishop of Manchester:
Are you not really describing a picture where you are actually
being fairly uncertain about whether you ever will make a profit
or even, I suspect, break even? Really it is the case that newspapers
have had it and the Independent will not last for too much
longer. That seems to be the kind of message that people in your
own industry are giving.
Mr Kelner: On 8 October 1986, the day after
the Independent was launched, Max Hastings (who was then
editor of the Telegraph) sent a wreath round to the offices.
People have been predicting the demise of the Independent—it
is almost refreshing to hear because I have not heard it for a
few years now- ever since day one. One of our great strengths
is that we are owned by someone who passionately believes in the
journalism that we do and we are part of a very big organisation
that makes quite a lot of profit and we are immensely valuable
to that organisation in terms of the fact that we are a flagship
and the fact that we share copy with our papers worldwide. It
is a daily struggle to get to a point where we break even, but
that is the aim.
Q703 Lord King of Bridgwater:
You are the flagship, can you just remind this Committee what
is the profit level of Independent News and Media? What is the
profit overall as a group?
Mr Kelner: I do not have those figures.
Q704 Lord King of Bridgwater:
In other words you are being carried by the group which is a very
profitable group. It is a question of what proportion of that
profit they are prepared to put in. Would you see yourself as
the flagship of that group or would Tony O'Reilly see you as the
flagship of that group?
Mr Kelner: He would find that a compromising
question as I do really because I am partisan. He would find it
a compromising question because it would deride the efforts of
those in South Africa or Belfast who are producing huge profits
for the proprietor to turn round and say, "Well, actually
the flagship is this paper in London that loses money". I
do not think he would answer it in such simple terms as that but
he would say it is a paper that he feels very proud of.
Q705 Lord Inglewood:
I would like to ask a brief question about circulation. You said
your circulation is about 250,000; you also said you had difficulty
picking up regular readers, you had more sporadic readers. In,
say, a week do you know what your readership might be?
Mr Kelner: The last NRS figures we had a daily
readership of 710,000 I think.
Q706 Lord Inglewood:
Sorry, I phrased my question wrongly. Over that week how many
sales are there?
Mr Kelner: The only figures you can go on are
the readership figures which are 700,000.
Q707 Lord Inglewood:
Those are the only figures you know. I am not criticising you
I am just trying to see what the figures are.
Mr Kelner: And I am not being defensive. All
I am saying is that there is no way of knowing, other than actually
going round and interviewing them all individually and there are
50,000 newsagents out there.
Q708 Lord Inglewood:
I appreciate that but you must have a bit of an idea.
Mr Kelner: The statistics that are the currency
of our industry are the National Readership Survey which says
that we have 700,000 readers. These are people who might buy it
once a week, five times a week, no times a week but they say they
are readers.
Q709 Lord Inglewood:
My question was prompted by the thought that if one of the things
you have to do is to try and sell a copy to everybody who reads
it every day, you must have an idea about where you think you
would get to if you did that.
Mr Kelner: There is no accurate way of doing
that.
Lord Inglewood: I do not want to take
that any further, I was just interested to know.
Q710 Lord Maxton:
I was very interested to hear you say that you would be doing
some podcasts. In March you said, "I have never met anyone
who ever listens to podcasts, I am not convinced they are the
future". Can I take it you have changed your mind?
Mr Kelner: That was a quote in the Guardian.
I knew when I was saying that that it would be twisted and turned,
particularly by our most hated rival. It was a rather flippant
quote at the time. I was actually making a lot more sophisticated
point which was that I think podcasts that are produced by professional
broadcasters which enable a listener to listen to something at
their convenience in a portable way is really valuable. I think
if, in future, newspapers can get to a point where they would
produce professional podcasts of a similar standard that would
be a very valuable outlet for our journalism. That is not a terribly
original thought, but my statement at the time was a reaction
to a lot of comment and interviews from other people in the industry
saying that this was a new toy, it was going to be the greatest
thing, it was going to be the saving grace of all of us. I would
not even say I am sceptical about the on-line world as far as
it relates here but I am slightly quizzical, probably more quizzical
than most.
Q711 Lord Maxton:
Can we come back to what you said this morning about if there
were no newspapers and just the internet somebody would come along
with the bright idea to get all these clever people together and
deliver it to your house and all the rest of it. To be honest
the BBC website already does that. If I am in London the first
thing in the morning I go to the BBC website on my laptop in my
flat and I can not only look up what is the news and read the
news, I can also look at what is happening in Scotland where I
live and come from and look at their website. If, in fact, you
had a major story then probably that story will be somewhere on
the BBC internet site and I can look at it and read it there.
It is already existing and you do not have to have some poor boy
of 13 or 14 delivering the newspaper to your house in the morning,
you can get it on your internet and you will be able to get it
within a very short period of time in my view on your television
set.
Mr Kelner: You are possibly right but have you
ever tried doing a crossword on the internet?
Q712 Lord Maxton:
Yes.
Mr Kelner: Do you find it as satisfying?
Q713 Lord Maxton:
No, but I do not do the crossword.
Mr Kelner: If you have a horse running today
at the 3.15 at Newbury and it is tomorrow morning and you do not
know whether your horse has won or not, I bet I could find the
result in a newspaper quicker than you can find it on the internet.
Lord Maxton: I would be tempted to take
that challenge up because I know exactly where to go.
Q714 Bishop of Manchester:
I think I have covered this partly, but can I just explore a point
you made to the Guardian where you said that part of every
newspaper's marketing budgets should go on marketing newspapers
generically. Do you feel in looking at the other newspapers that
they are doing that sufficiently and do you regard yourself as
a kind of market leader in that way?
Mr Kelner: No, I certainly do not regard myself
as a market leader in that. I think that was an answer or a comment
to the point that there have been a lot of turkeys voting for
Christmas around the newspaper world and we have talked ourselves
down as an industry quite substantially over the last few years.
I think we should get into a position where, as an industry we
can promote the value of our industry. I think it is difficult
given that there are so many vested interests in it, particularly
in Britain it is such a competitive industry that to try to get
the proprietors of all our leading newspapers to agree to put
money behind the campaign that promotes the value of newspapers
generically would be quite difficult. However, I think it should
be done and I do feel a little bit like a lone voice.
Q715 Baroness Bonham-Carter of Yarnbury:
According to our brief your parent company thinks you are going
to go into profit this year.
Mr Kelner: That is very good news.
Q716 Baroness Bonham-Carter of Yarnbury:
Is one of the reasons, if that were to be true, to do with the
fact that you have recently conducted some quite severe cuts across
your journalist base and does this cause you concern? Could you
tell us more specifically how many journalists and specialist
correspondents you employ now in contrast with 10 years ago?
Mr Kelner: I would not have the comparative
figures for 10 years ago. I would think we probably employ more
people than we did 10 years ago. I joined in 1998 after a period
when the Independent was pretty well down on its uppers
and had fired a lot of people. Independent News and Media took
the paper over and appointed me as editor. The editorial budget
went up in the first year by 23% so I think in terms of 1997 and
now we have probably got the same if not more journalists and
we are producing a lot more output. This year we have to go through
a period of retrenchment and I think the way we handled the cuts
in the editorial budget was done very sensitively and consensually.
We had a voluntary redundancy scheme; not a single person was
made compulsorily redundant. A lot of people took advantage of
what were terrific terms and what has happened is that we lost
some very good people, but also people who had been there for
20 years and probably needed to move on. We actually let go more
people than we wanted to let go so it enabled us to employ some
younger people in their stead. What we have done over the course
of the year is to re-engineer the newsroom and we have a very
young, dynamic newsroom now. I think we have come out of this
process stronger rather than weaker.
Q717 Baroness Bonham-Carter of Yarnbury:
Have you lost special correspondents, foreign correspondents?
Mr Kelner: The only correspondent that we lost
is that we went down from a full time staff of two to one in Washington.
Instead of having four people covering America on a staff basis
we have three and a half, plus a business correspondent.
Q718 Baroness Bonham-Carter of Yarnbury:
What were the reasons behind that?
Mr Kelner: The constant struggle to break even.
Chairman: Mr Kelner and your colleague,
thank you very much indeed. You have given us some excellent thoughts
to chew upon as we continue this inquiry. It is very kind of you
to make the time to be with us and to be so frank with us as well.
Thank you very much indeed.
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