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Panpa Bulletin : September 2006
30 | PANPA BULLETIN September 2006 PANPA CONFERENCE growth from diversification and innovation. Save today, invest today. Grow products, spread costs. Grow re- turns, spread risk. The state of our industry in 2006 is starting to reflect growing confi- dence about our direction. Major industry investments during this past year highlight the dynamism of newspaper media and major executive recruitment underscores it. Two major newspaper compa- nies in the region reached out to new corporate leadership. Fairfax appointed David Kirk as chief ex- ecutive and The West Australian poached Ken Steinke. David Kirk, a former PANPA director, has struck out on the twin courses of cost contain- ment and investment in growth. On the print side he has overseen Fairfax's purchase of Albury's Border Mail daily, the Rodney Times group, The NZ Independent as well as a more suburbans and community papers. Ken Steinke moved from Auckland and APN to take the helm of West Australian Holdings in Perth. The West Australian used to be famous for printing papers, counting the cash and spending as little as possible. Ken Steinke has flagged in recent interviews his keenness to keep spending tight so he can also invest in print and digital product on the back of the company's $200 million in- vestment in new presses. The end of the industry's print/ digital confusion is also evident in major corporate developments during the past 12 months. Rupert Murdoch declared his renewed digital faith early last year and has disappointed no observers since. His purchase of MySpace.com for US$580 mil- lion was a big step, and remem- ber since then that this previously little known social networking site has gone on to be one of the hottest things on the web. Last month its traffic grew 183 percent to 45 million users, according to Nielsen//NetRatings and at this rate it is likely soon to surpass Web giants Google and Yahoo. News Ltd reorganised its Australian digital products into a new division called News Digital Media and it has invested heav- ily this year in the relaunch of all its major newspaper websites and integrated newsdesks. It has launched PerthNow, a daily web- site that does not have a local daily newspaper in its stable to rely on. Fairfax made headlines for its $NZ700 million for Trade Me, New Zealand's leading internet business which has since branched out into new areas, most recently jobs. Industry executive recruit- ment, too, is now reflecting the 'Newspaper Media' realities of channel diversification. News appointed Richard Freudenstein to be CEO of News Digital Media. The Australian ex- pat comes from the UK where he's been chief operating officer of BskyB pay television. Fairfax also reached into the pay television arena to secure Jack Matthews as its CEO of Fairfax Digital. The US-born Kiwi citizen has wide experience in telephony, media and internet. APN is aggressively pursuing in- ternal growth of online by first and foremost leveraging its print me- dia content across digital formats. As a major radio, outdoor and regional print player in Australia and New Zealand, the company is the most broadly based media company of any PANPA mem- ber and continues to push the boundaries. This year has seen it launch its first web-only radio sta- tion to complement its Australian regional newspaper footprints. Rural Press continues to be uniquely placed with its strong base of local publications. Its chief executive, Brian McCarthy, report- ed during the period under review that he was becoming more ag- gressive around online expansion of his business. For Rural, per- haps uniquely, this is an offensive strategy. Country Australia where Rural dominates has not seen the shift of advertising dollars to digital as has occurred elsewhere. Rural Press is exploiting that po- sition and is investing carefully to ensure it is the only local jobs, homes and cars player in each of its print markets. The local news- paper franchise is strong. Like other newspaper publish- ers Rural is backing the future of print with big investments in its major printing facilities across Australia, led by Mandurah in Western Australia, Ballarat in Victoria and Murray Bridge in South Australia. Fairfax is expand- ing its plant in Newcastle, APN is completing a major new facility at Yandina on the Sunshine Coast of Queensland, with upgrades following at Bundaberg and next year in Rockhampton. News Ltd, meanwhile, has been upgrad- ing most its major plants across Australia for colour and inserting. Publishers in this part of the world are doing well compared with the US. Our business mod- els are adapting faster and scor- ing significant digital successes. We're now keener than ever to learn from north Asia where the excitement of the newspaper- initiated multi-media renais- sance is palpable. On the print side we now increasingly look to continental Europe to find real achievement and inspiration in product innovation. A small sign of success but one worth mentioning in this context: for the first time New Zealand and Australia picked up more marketing awards at the International Newspaper Marketing Association awards this past autumn than did pa- pers from the United States. The biggest development without doubt in recent years has been the creation of a new company called The Newspaper Works. It has been established by News Ltd, Fairfax, APN, Rural Press and West Australian Newspapers Holdings to aggressively market newspapers as a medium to ad- vertising clients, creative ad agen- cies and media buying agencies. The body has a commitment from the top of each of its biggest shareholders, with each compa- ny's CEOs being a founding di- rector. It has a budget big enough to transform the perception of newspapers and increase our ad- vertising share. Its inaugural chairman is John Hartigan, the executive chairman of News Corporation. Its first chief executive is Tony Hale, who start- ed work in September to change the way our clients and potential clients see us and also how our own staff see ourselves. The board did not want a so- called newspaper guy. Learning from overseas experience it wanted someone who was pass- ionate about print, but whose background was as a leading light in the advertising com- Newspapers evolving into newspaper media (cont d) The biggest development without doubt in recent years has been the creation of a new company called The Newspaper Works. continued page 32 Source: Newspix R. John Hartigan (Chairman and CEO of News Ltd), Robert White- head (director marketing Fairfax) with Tony Hale (CEO the News- paper Works Ltd)
November December 2006