Media buyers say News Corp’s closure of mX is not beginning of the end of print papers
Ryan
Media buyers have said News Corp’s decision to close the mX commuter newspaper was inevitable because of the shift to mobile by consumers, but are split on what it means for newspapers more broadly.
News Corp announced the move yesterday afternoon with 30 journalist jobs now in the air, but media agency boss Simon Ryan says the publisher had little choice.
“It’s not rocket science,” said Ryan. “Consumers are now turning to their mobiles for immediate access to breaking news and content. The closure of mX is understandable and not a huge surprise given the changed media habits of commuters.”
Other media buyers had similar views with ZenithOptimedia CEO Ian Perrin lamenting the closure, noting that when MX launched in 2001 it filled an important gap in the advertising market.
“At launch mX was a compelling offer for both consumers, who got a light entertaining read on the way home, and advertisers who could target a specific audience at a specific time,” said Perrin.
“The reality however is that mobile technology has totally leapfrogged their product. It’s a smart decision by News to make a quick break.”
OMD CEO Peter Horgan said it was a commercial decision to close the newspapers: “News Corp needs to make commercial decisions about which distribution channels are viable for them.
“I think with momentum shifting to digital they have made a call on a publication that was never a cornerstone of our go to market strategy. MX was useful in its day but on the fringes.”
Most of the media agency bosses, Mumbrella spoke with, were reluctant to say that the mX closure would have broader implications for print.
“While the newspaper market is challenged, I think there is a big difference between MX and other titles,” said ZO’s Perrin.
“Mainstream newsmedia have built value around their key writers, they have adapted their models to online platforms and benefit from a greater diversity of revenue. So I’m not sure the mX closure has that great a bearing on the long term sustainability of others.”
Ryan, whose clients include News Corp’s chief print rival Fairfax, agreed saying: “Potential print closures over the coming years are unlikely.
“There’s still strong demand locally and with no real mass media print closures happening abroad. It’s a check and balance, something that’s important to our communities and drives debate, discussion and advertising opportunities.”
Sydney managing director of independent Nunn Media Chris Walton was more hesitant about the implications of the mX closure.
“If you look at the signals over the last five years you have to conclude at some point some titles would close or not exist in their current form,” said Walton.
“I think this is more about the economics of trying to run a free newspaper. I don’t think it changes the state of newspapers… it is just more evidence of the challenges they face.”
Source: SMI
However he also noted the broader exodus of advertising from newspapers which according to Standard Media Index has seen media agency spend fall from $1.316bn in 2007 to $783m in 2014.
“From a commercial point of view you just have to do the weight test on any newspaper and pick it up to see it is thinner and they aren’t getting the advertising they used to,” said Walton.
“mX was launched for its tidbits/journalism all of the way home but consumer habits have changed. Get on any bus or train and everyone has their nose down on their screens. It’s much more competitive, you have all the news sites, games, emails etc.
“It was no longer relevant as people found other ways to consume news.”
Nic Christensen
Asking media agencies about the future of print is ridiculous as they continue to pocket print revenue.
This article requires commentary from a neutral source with no vested interests in print.
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All the commentary on the closure of MX has missed the obvious. The free paper was launched in 2001 as a block against the Metro organisation which was establishing commuter papers around the world. News Corp never really tried hard to sell advertising into MX. The waters were a bit muddy in the first six months as Fairfax fiddled and bungled with its ill-fated lookalike, Melbourne Express. The MX budget was equivalent to an extra 4 pages each daily in the Herald Sun.
Someone at head office has simply asked the obvious question: why are we wasting 70,000 copies in Melbourne every day? And doing the same in Sydney and Brisbane. The project has NEVER made commercial sense. Even back in 2001.
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My Father had the Herald home-delivered every day and “the three” on a Sunday.
(there were three Sunday papers in his time).
He and my Mother read the paper every day.
I have occasionally had papers delivered, I sometimes read them (free ones at coffee shops) but not regularly.
My kids have NEVER had papers delivered and don’t read them, not even at coffee shops.
There are clever people on this site — surely SOMEONE can detect a pattern here?
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“This article requires commentary from a neutral source with no vested interests in print.”
Yeah – but the graphic on the decline in ad spend is pretty conclusive. It’s nearly 50% of what it was 7 years ago – and that was after a decade of decline beforehand.
Nic knows these things – he did accounting!
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Oh well, at least the trains (and stations) will be a fraction cleaner …
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As Ash Long points out, the MX decision is not to do with print disruption. It was a loser in profit terms from the outset. Both Fairfax and News launched and only News persisted because of its mass market concerns. The more telling sign about print is the one Mary Meeker repeats in her annual review of digital trends. Essentially, print share of dollars is way out of line with its share of audience time spent. http://techcrunch.com/gallery/best-of-meeker/
The message of MX might be hat News is finally having to cut the bleeding, so Chris Mitchell might have a bit to worry about if this sort of rational behaviour takes root.
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John Hollands – are you happy that your kids never read newspapers? Will they be equipped to cope with an increasingly complex world? Just wondering.
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Good question.
Yes, very happy.
They aren’t punters so the form guide is no use; there aren’t any classifieds anymore except online, the news is always slanted one way or another, they groan at the snappy sub-editors jokes (“Nut screws washer and bolts”), they have no conception of privacy, they are fully (totes) connected to their friends and cohorts, they can tweet in to current happenings immediately, they are less passive consumers of media than us Boomers.
Increasingly complex world? Maybe, but they use computers and complex applications as a matter of routine. Not just Facebook but spreadsheets, Illustrator, maths multivariate (the daughter came top 2% in maths in her HSC).
What may interest some is that my son uses computers and the internet extensively for his livelihood, including his own e-commerce sites, together with the occasional scrap of paper… yet at school he had no computer, no computer classes, no online school, nothing. You may think it a poor deprived school but he went to Sydney Grammar School which had (has?) a policy of classic education sans computers. Go figure.
My daughter had a pub steak with me and asked to sit facing the TV because the cricket was on. She chatted on about the players and selection and rules and such – most of which I didn’t understand. I’m not a cricket fan, never passed that on to her but all by herself she decided she likes cricket, likes going to it and likes watching it.
Like I said, go figure.
They’ll find their own level and it’s a fascinating journey although sometimes scary (like when daughter came home from school saying “god, how good is physics! I LOVE physics!”)
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