Fairfax Media revolution brings Internet migration into focus
by Jeni Bone on 19 Jun 2012
For the past 10 years, as change moves faster and faster, predictions on the speed of change caused by the Internet have consistently fallen short of reality.
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The breathtaking rise of high resolution tablets and the smart phone has meant that mobile Internet access is now the norm. The Australian media landscape, like the rest of the world, is undergoing massive change, driven by the rapid migration of consumers and hence advertising online.
Within two years, for the first time, more of the $13 billion Australian advertisers spend each year will be spent online than anywhere else.
Yesterday in a move that shocked even its own journalists and printers, Chief Executive of Fairfax Media, Greg Hywood used the Internet to announce a major restructuring, involving 1900 job cuts in the production, print and editorial facets of its business.
Against a background where world-wide circulations dropping in newspapers and magazines now at rates of 12-15% annually because of the move by audiences to online sources, Hywood announced that Fairfax will close its Chullora and Tullamarine printing presses by June 2014, since both presses have significant 'surplus capacity' that it no longer requires.
The Age and The Sydney Morning Herald will both be reduced to tabloid or 'compact' size by March 2013.
According to an announcement made to the share market and staff yesterday, the company plans to begin charging for access to certain online content by the end of 2012 - despite global experts advising media organisations not to 'lock up their content', or face reader backlash.
Rival News Limited is expected to announce its own cost-cutting measures, at least 1,000 jobs, later this week.
In the wake of the announcement, Harold Mitchell, media strategist and consultant stated that 80% of the world’s media would be digital by 2020.
'This is the biggest change in our lifetimes,' added Mitchell who today heads up Aegis Media.
World-wide newspapers and magazines have been grappling with a steep drop in print advertising revenue, steadily declining circulation and the migration of readers to free content online.
These local changes mirror UK, US and European shifts. The highly regarded British newspaper The Guardian has surmised it could be digital only within three years.
This week, the largest newspaper in New Orleans, USA, The Times-Picayune, was the latest to announce an end to daily print publication, moving to a schedule of three issues per week, to adapt to 'an increasingly digital age'.
And this week also Alabama's three largest newspapers have also shed staff and will cease daily publication, publishing just three issues per week in a move toward investment in online news.
As Harold Mitchell observed, for an industry savaged by the erosion of print advertising dollars, focusing on the digital space and revenue is necessary for survival.
As Australian Media buyer Mark Pejic, MD at MediaCom, commented that ‘People want to access their content in the easiest way possible, with the best experience possible, and digital delivery is answering both of those needs.'
With the very popular smart phones, such as the Samsung Galaxy sIII and the HTC One X and the soon to be released iPhone delivering laptop quality screen viewing, one can only wonder if the 3-5-10 year projections for the survival of print media will likely to be optimistic for many publications.
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