News Corp printing under review
Major newspaper publisher News Corp has called in management consultants Deloitte to review and cut its costs, with printing, and its smaller and regional newspapers, in the spotlight.
News is though pushing ahead with its planned greenfield print site west of Melbourne, which will take over production early next year from its current Westgate centre, which is operating under a leaseback arrangement following its $55m sale.
The call to Deloitte has come as News has suffered plummeting advertising spend in its newspapers since the onset of the virus six weeks ago. It has already stopped printing 60 of its community newspapers, including former star performers such as the Wentworth Courier and Manly Daily. Senior execs have taken a major pay cut, and the company has said job losses are inevitable.
News Corp was already seeing sluggish advertising revenue from its newspapers prior to the pandemic, with industry insiders predicting the permanent closure of at least 30 of its regional titles.
News, along with other major publishers, is thought to have lost around half of their advertising revenue in the past few weeks. Regional and community papers have suffered more than most, resulting in newspaper presses grinding to a halt around the country. The biggest regional publisher ACM has already stopped printing almost all its 160 community titles. Many smaller publishers have also shelved printing.
In a further blow to the beleaguered sector, the government has ruled that local councils no longer need advertise planning, tenders, and other information in local papers. Councils can instead publish the information on their websites. The edict is permanent, not just for the duration of the crisis, robbing local papers of a major and regular source of income. Local councils are big spenders. Many local papers have a full page or two from the council in every issue. That has now gone and will never return.