Chris Mitchell admits The Australian has not been profitable since 2008
The Australian has struggled to be profitable since the global financial crisis of 2008 its editor-in-chief Chris Mitchell has conceded in a video interview, on the newspaper’s website this morning.
In the interview with newly installed Media editor Sharri Markson Mitchell took the ABC’s Media Watch host Paul Barry to task for last week declaring The Australian was losing between $40m to $50m a year, and said he plans to report the ABC to the Australian Communications and Media Authority (ACMA).
“It’s probably not a profitable business on The Australian,” said Mitchell, in response to a statement by Markson that print was still a “profitable business”. “As people have noticed we’ve had a hard time since the GFC but the idea that we are losing $50m is incorrect.”
“(It’s) completely incorrect and we’ve never gone even close to that,” he said.
Mitchell has generally insisted that News Corp Australia’s national broadsheet was profitable. As recently as 2012 he said The Australian made a “positive contribution” to News Corp’s bottom line, while in 2011 he declared that the newspaper had been profitable for most of the last 25 years. (*Mitchell has since clarified these remarks to Mumbrella see update below.)
“This question is bound up with print charges and divisional profits, but News (Corp’s) profit would fall very substantially without this paper,” Mitchell said, in 2012.
In today’s interview, Mitchell conceded the challenges the newspaper faces with the digital revenue model. He also spoke about the newspaper’s attempts to cut costs, which he said would see the newspaper halve its loss compared with last year.
“Like most newspapers we’ve lost classified advertising”, he said. “I think the aim of the game in paper is to lift your display advertising and lift your cover prices and then the balance that you lose from classified you need to try and make up with digital.
“Have we made that up? No we haven’t but we have cut costs pretty effectively and I would think we would go close to halving our loss from last year, this year.”
Mitchell did not declare the size of The Australian’s losses but, as Mumbrella reported back in August The Australian, like many News Corp papers has suffered double digit declines in print revenues.
The editor-in-chief of The Australian also said the newspaper would continue to “extract” money from print for as long as possible.
“I think there’s two ways of thinking about the future of our business”, he said. “There’s the people like Greg Hywood and our former CEO here Kim Williams who believe the task is to get to a digital future as quickly as possible.
“The other view is that print has some future and we are determined to extract dollars out of that for as long as we can on the way to building a digital future.”
“In our company, and certainly at The Australian, you’d find that more than 90 per cent of all our revenue comes from print. So even though we’ve built quite a growing digital business, and we have 65,000 paying subscribers, there’s a dime for every dollar we make in print.”
One of Australia’s most combative editors Mitchell also took aimed at Paul Barry and the ABC arguing that there was a “concerted effort” to paint The Australian as unprofitable.
“I think there is a concerted effort by media rivals and, particularly by people at the ABC, to paint The Australian as some loss making hole in the ocean,” he said. “That’s not right and I wouldn’t think they would give us so much attention if they weren’t so perplexed by our journalism.”
Nic Christensen
UPDATE: Speaking to Mumbrella this afternoon Mitchell clarified his previous remarks explaining that rebates and recharges were an important part of The Australian’s contribution to News Corp Australia’s bottom line.
“The company as a whole would have $30m worse off without The Australian, i.e. various cost centres that recharge to us, would have been lost and the business as a whole would have made a lot less money,” said Mitchell.
“I wasn’t fudging when I said that a few years ago. The last profit we made was in 2008 and I’ve said a couple of times part of what has happened in the last two of years is a very large investment in digital.”
“Saying that you haven’t made a profit — that means that after all the retail print costs etc. it takes you into the red.”
“But that is very different from saying if The Oz didn’t exist News Corp would be better off without that loss. In fact it would be $30m worse off because people (other elements of the News Corp Australia business) charge us commercial rates for printers.”
Pull the other leg Mitchell it yodels,perplexed by NEWS LTD journalism, what journalism printing Liberal party propaganda is not hard. You gave up serious journalism when Murdoch gave you instructions to destroy the Labour Govt.
I wonder how he kept a straight face sprouting all that BS
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Is Mitchell confused by his own spin? He says on one hand that News profit would fall if the oz was taken out. Now he says they lose money.
The real clue, as Mitchell confirmed in 2012, is in the recharges and allocations of print, distribution and overhead costs that are capable of subjective estimation. Given Mitchell’s status with Murdoch, it seems unlikely that he suffers injustice on that front.
Fact is News has never made any attempt to disguise the fact that the Oz has been a big black hole. Mitchell now confirms that the digital subs he crows about are worth nothing much. He is also clearly praying for Fairfax to get out of print so he can suck up the remaining display dollars.
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Paul Barry would know all about a concerted effort to paint media rivals…
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A whole lot of people are “perplexed” by your journalism, Chris. if you’re going so bad financially – at least you admit that now – most of us can’t understand while you immediately alienate half your potential readership with your endlessly biased right wing lecturing. There are only so many Alan Jones retiree acolytes out there who you can count on to spend their pensions on yours and Rupert’s view of how the world should be run.
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The Australian always loses money – it’s not a business, it’s a political pamphlet.
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The Australian making a complaint to ACMA about inaccuracy would represent the final death of irony surely.
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The Australian’s bias makes it unreadable. How can you trust news when everything is spun for Murdoch’s favorite government.
And has anyone noticed how many cafes only have The Telegraph and The Australian for customers to read. I smell rat. Wake up Fairfax.
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The Editor of the Australian lied about its profitability and continues to mislead.
Is it any wonder that the print media, and News Ltd particularly is now untrusted and unread.
Truth in newspapers is dead.
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Peter Rush, I think it is because News Limited has a good deal on delivering its ‘newspapers’ to businesses such as cafes, while Fairfax does not. My cafe refuses to run News Limited papers.
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Ho, ho, ho Chris, and News Ltd is NOT working in an “orchestrated and deliberate fashion” to destroy large elements of the ABC — IE, in order to re-siphon massive (publicly-funded) golden rivers, Rupert’s way?!
Shall we just begin with the ABC News & Current Affairs television and radio feeds into Asia? … And where shall it all end?? Doesn’t bear thinking about.
Let’s put this universally despised “Fox & his flunkies”, on the run!
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The update is wonderful. Shades of Chris Skase. They should make Mitchell scorekeeper for oz cricket and reallocate the SA runs on a more equitable basis!
I am laughing myself hoarse here. Truly. This is magic.
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I used to love the Australian, particularly the Weekend edition, which I believed to be the best newspaper in the country, particularly for writers such as Nicholas Rothwell, George Megalogenis et al. But once it became ‘the boy who cried wolf”, with its totally biased approach to politics,I cancelled my subscription. I believe that most readers of the Oz would also be ABC and SBS followers, who would be pretty disgusted at the hysterical attacks by the Australian. A close family member had a very senior position at News Ltd, and I know that the Dominion newspaper in New Zealand was the only News publication that had the courage to resist Rupert’s demand to support the invasion of Iraq. How ironic that he would no longer be so keen to support Tony Blair!
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Someone PLEASE tie Sharri Markson’s hands to the table. She’s going to poke someone’s eyes out with those things! Looks like she’s conducting an orchestra.
Then again, that’s probably not far off the role she’s in now – trying to get really, really old instruments to play beautiful music. Good luck…
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Peter Rush, change your cafe or buy your own copy of the new improved now even smaller Herald and watch the circ figures double.
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