The bad news for Australian media companies is about to get much worse unless the Government acts
News Corp Australia has announced 60 print titles across its network will be suspended, but executive chairman Michael Miller explains it's going to get a whole lot messier if the Australian Government doesn't take decisive action now.
Audience demand for trusted local news and lifestyle content has never been greater, yet media companies are under unprecedented financial pressure.
Too many examples in recent months show Australian media is passing its tipping point. The announced closure of AAP, the looming loss of local voices such as The Sunraysia Daily and the decision by Nine to suspend key products are ominous signs. And yesterday News Corp Australia announced it was suspending the print editions of 60 community titles across four states from 9 April.
The question is obvious, when audience demand has never been higher, why are trusted media companies in such danger?
The simple answer is the loss of revenue triggered by COVID-19 has further tightened the financial stranglehold the international tech giants have over Australia’s creative industries.
We are now at the stage where unless the Federal Government takes decisive action to make 2020 the year digital platforms start paying publishers to use their content, the bad news for media and Australian communities will get much worse.
Time has run out. The trading imbalance between the platforms and Australian media companies cannot continue.
The COVID-19 emergency is powerful evidence that when it really matters, people turn to news from professional, accountable and trusted news organisations.
Total audience numbers for all traditional media have exploded and are now the largest in our industry’s history.
For News Corp Australia total readership is up 81% (1). Consumer subscription sales are up 287% (2). This increase is the most dramatic we have ever seen.
It’s the same story for video – a record 102m views across our network, up 45% year on year (3).
In print, downloads of print replica editions on digital devices are up 34% (4), supermarkets are selling out of papers and home delivery inquiries are surging.
But media companies are trapped by draconian legislation and regulation restraining their ability to grow, merge and compete, while on the privatised internet they are plundered by tech giants with no commitment to local communities, no journalists and no content of their own.
Yet despite this uneven playing field, media companies have innovated; created new products and embraced new forms of delivery as audiences and advertisers moved online
In little over a year, News Corp has launched 16 digital, hyper-local digital mastheads – our fastest growth area for subscriptions – often in communities we’ve not operated previously. More will follow.
We are providing valuable local news for readers and more targeted, integrated marketing solutions for clients.
News is proving that a company built on local journalism combined with platforms and services that help local business thrive can have a vibrant, digital future.
The results tell the story.
The award-winning Australia’s Worst Serial Killer campaign, developed by Newsamp for the Heart Foundation, saw visits to the Heart Foundation website rise 70% and calls to its helpline grow by 130%. It triggered law changes and some 120,000 Australians completed the Heart Age Calculator within two days of the campaign launch.
Our data platform, News Connect, draws on more than 2bn consumption signals from millions of Australians to create some 2,000 distinct audience segments. Included in News Connect’s technology suite is powerful geo-targeting technology that identifies thousands of electronic devices in local areas to create bespoke marketing solutions.
This helped Aldi identify grocery shoppers, target them with messages and then measure who visited a store. People who saw the campaign through News Corp visited an Aldi store 1.5 times more than those who didn’t.
These kinds of innovations, together with our strongly growing subscription model, are the building blocks that can fund local journalism that gives Australian communities a voice.
But we need Government to act.
For too long we’ve been handcuffed in a virtual digital dictatorship.
Successive Australian Governments have stood by and watched as our traditional business model has been brought to the brink of failure – they must not stand by and endanger our
future as well.
We don’t know when COVID-19 will end, but we do know where this will all end unless Government addresses the imbalance in bargaining power held by the digital platforms over
media businesses .
Sources: 1. Adobe analytics, pageviews; web, mobile + app, Q2 weekly avg vs prior week. 2. Versus same week last year. 3. Adobe analytics March 2020. 4. Adobe analytics, pageviews; web, mobile digital print editions March 23-29 versus weekly average February 2020.
Michael Miller is the executive chairman of News Corp Australasia
“Australia’s demand for trusted news”, a bit rich coming from an organisation that yesterday published “Things have changed with this coronavirus panic. Now Australians can be – must be – back at work within two weeks” & have willfully downplayed the gravity of the crisis in the US and UK.
And when was the last time you paid tax?
Back of the queue.
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What a load of rubbish.
If the digital platforms have it so good, you know what will happen?
New competitors will arise and wipe out the likes of Facebook, Google and Amazon.
These digital companies are large and slow moving and will be slaughtered by newer nimbler platforms that will eat their lunch.
It’s the way of the market.
The Government should just get out of the way.
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So you’ve embraced digital innovation within the last 12 months (wow!)…paid no tax for years… failed to engage your audiences (some would say actively insulted them) – yet now you need help. Yeah..Nah…
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Perhaps where one of only a few countries where GooBook doesn’t have a stranglehold on traffic is Korea.
Subsequently the search portals have been paying CPV syndication fees to publishers however the user does not land on publisher assets. All news content thus lives on the tech platforms’ own environment and publishers have ended up having no control over their subs and ad revenue.
What’s worse is that the tech portals have formed up “News Committees” that decide which publications are deemed “worthy” of syndication.
Ironically, Google and Facebook are seen as opportunities for publishers to take back control of their own content assets thanks to their “free” distribution and much less “bias” on who gets the traffic.
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The way News will abuse any national crisis – corona, fires – for their own gains is such poor leadership.
Bail out the journalists, not the corporation.
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Just an excuse…manly daily getting thinner and thinner for years. They are just not interested in community
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Why should the Government act??? Get the priorities right. How ridiculous.
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Hmmm … for decades the big, Sydney-based media companies have been screwing the rest of Australia and are now, in turn, being screwed by someone bigger. I call it karma …
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“Successive Australian Governments have stood by and watched as our traditional business model has been brought to the brink of failure – they must not stand by and endanger our future as well”
It was fine when News was buying up and destroying other small media owners back in the day; but someone else is winning and now its not fair.
The reason traditional business model failed is not the governments fault or other global businesses, it’s to do with the fact that the traditional business model never evolved. Rather than resting on trading deals to fill out your revenue, you should have focused on innovation to stay relevant.
Also, lets remember News is one of the largest global media businesses – even though they like to side with local media for sympathy.
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Nic, no matter what you think of NewsCorp, you can’t deny that Facebook and Google are hollowing the entire AU media industry?
They don’t pay tax/ & hardly recognise revenue in AU. They don’t create many jobs and certainly don’t pay aggregation royalties/ Neither to journo’s for scraping content. Nor consumers for harvesting data
So why are platforms given carte blanche? But media companies regulated? Focus on the story mate
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Despite your liking of News Corp or not – the facts are plain and simple and successive governments have not had the gumption and probably not the skills to properly bring to account the Google’s, FB’s etc – so that they actually pay for journalism (quality or not). It’s someone’s copyright that is being devalued…fundamentally everyone needs to value and pay for content…free-loading needs to stop!
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A rich opportunity for gutsy journo’s to put their money where their mouths are. Invest in new publications that actually sell.
How hard can it be?
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I saw someone reading a newspaper on the plane once and it was hilarious. I had to take a photo to show my kids. We were all amazed and how ludicrous it seemed. I am surprised this is still a thing.
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Your comment makes no sense.
The argument is that digital platforms are anti-competitive.
Yet yo suggest that despite being anti-competitive new forms of competition will turn up and out-compete digital platforms.
How’s about we just remove the ‘immunity from liability’ for digital platforms? Maybe then these mysterious companies can arise to out-compete Google and Facebook – even despite not having the same market share, access to capital, price point control or data troves?
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Judging by the number of media companies going bankrupt I would suggest it’s very hard to invest in publications that sell.
Maybe that’s because publication content can be aggregated and distributed online for free without recourse?
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Bail out taxpayers not journalists.
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Spot on Nic.
I can personally attest that their culture would demand all News employees in the building to be at their desks, ‘working through this together’. Of course the rest of AU should be at their desks as well! Ha ha
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“Audience demand has never been higher”. This would be demand for COVID-19 news. Is there anything News Corp could report that AAP couldn’t? If the government wants to invest in objective, just-the-facts-ma’am journalism – as opposed to companies that publish self-interest content such as this post – saving AAP would be a better place to start.
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What’s Michael Miller actually asking for here?
The government has already ordered Facebook and Google to produce a code of conduct that governs their commercial relationships with news publishers by November.
If the government thinks these codes of conduct don’t sufficiently address the concerns of the ACCC’s platforms inquiry, it has promised to step in and create legislation to do the job instead.
Does Mr Miller want the code of conduct negotiations to be completed sooner, because the coronavirus is causing so much pain in the industry, making the situation more acute?
Or does he want the government to go back on its already-announced plan and create regulation immediately?
Either way, it would be good if he said what he meant, instead of falsely implying that no action is being taken.
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