Select Committee on Communications Minutes of Evidence


Examination of Witnesses (Questions 2360 - 2366)

WEDNESDAY 26 MARCH 2008

Mr David Montgomery

  Q2360  Chairman: They conform publicly to that but privately there might still be a substantial bar to a British company wishing to take over newspapers in another European country?

  Mr Montgomery: I think if there is a choice between bidders in certain countries, and I am not talking about any of the countries where we are present but we do have experience elsewhere, then the political influence might swing it, but it would be behind the scenes.

  Q2361  Chairman: Is there anything one can do about that?

  Mr Montgomery: Our message as newspaper publishers has got to be that we are completely committed to protecting the traditions of the individual newspapers. As I say, there was some suspicion in Norway, but I think everybody now accepts that we have strengthened the businesses there, and we have done so by using very talented local management. Norway for instance is the most advanced in terms of on-line revenues and the very distinguished chief executive in Norway is not just a former editor-in-chief but he is also a former on-line director, and the Norwegian tradition of technology and creativity has been taken on a step further by him, and I think it is recognised that this is a genuine Norwegian business. It may be in terms of shareholders controlled by a London-based company but the business is operated day-to-day by Norwegians. Provided we can continue to demonstrate that, then I think we should not get into difficulties.

  Q2362  Lord Inglewood: Talking about your `invasion of the Continent' you described your company as not being a British company but being a globally funded company, so I assume in the kind of capitalist world we are in now you would argue that the idea of foreign ownership or national ownership is really outdated anyway and you touched briefly on television talking about things? Do you think that the way in which the market in this country (particularly in television) has been opened up to ownership from really anywhere, contrasting with other parts of the world, has been to this country's advantage?

  Mr Montgomery: Yes undoubtedly, and obviously as someone who spends a lot of time in Europe, I think if we opened the door further to European businesses, as opposed to American businesses influencing our broadcast content, that would be a great benefit to us. I am thinking particularly in terms of cultural content that the Europeans excel at.

  Q2363  Lord Inglewood: It seems to be the heart of the case you have been making to us that the key to successful media business is running with the grain of the culture of the audience to which you are selling; is that right?

  Mr Montgomery: That is correct but of course you might argue that if you expose audiences to new content, even unfamiliar content, by opening the doors to new media products, then you will also achieve a success.

  Q2364  Lord Inglewood: Do you see yourself as a kind of leader and educator or are you a follower of public taste in the business context?

  Mr Montgomery: We do not have a mission which goes beyond sustaining these products and developing our content model as I have described. Yes, I think giving people more choice, not just in terms of content but also in the means by which they receive that content, is important. Obviously I am driven by a desire to transform a business that has been old-fashioned, an industrially based business, for commercial reasons, but I also have a personal belief in the human desire to learn new things and to be exposed to new content, and that has been constantly proved. I think that when you are dealing with highly educated audiences and people with sophisticated tastes, which we are in Europe, then that job has clearly got some future.

  Q2365  Chairman: As a very last word, is there anything you want to say about the next ten years? How do you see the United Kingdom newspaper industry and European newspaper industry developing, or is that too much in the realms of futurology?

  Mr Montgomery: Again, I do not think there is a difference between the UK and European newspapers in terms of the challenges that they face. My simple guiding light on this is that we have to recognise, firstly, the richness and the quality of the content that we have within the newspaper journalistic resource and then to use that more creatively across many different routes to market and to trade more effectively with our consumers as opposed to simply selling them one copy of one newspaper a day, so it is tremendously challenging and I have no doubt that if we are spared and we can see what it is like in ten years' time, newspapers will be a very, very different industry indeed.

  Q2366  Chairman: But you can foresee a future for them?

  Mr Montgomery: For the printed word, absolutely I do, yes. I think that a newspaper is an intimate experience constructed by people with very detailed knowledge of their market and their consumers. When you think about it, in any newsroom of 100 journalists there is a network and a history extending across wider society, and indeed they share hundreds of years of experience. You cannot replicate that and the Internet will not do that, not in the short term anyway, so, yes, I think provided we understand where the value is, and that is in content, then the newspaper business will survive. There will always be a desire for the printed word but of course newspapers will have to adapt, perhaps more than publishers imagine even today.

  Chairman: Thank you very much. It has been a fascinating session. We are particularly grateful for the information and the light you have shone upon what is happening in the rest of Europe in the newspaper industry there. We have kept you rather longer than I suspect you thought, but that is a tribute to the breadth of your knowledge and understanding. Thank you very much.






 
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