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Panpa Bulletin : May 2007
6 PANPA Bulletin May 2007 news Fairfax Media, now merged with Rural Press at a cost of $2.6 billion in cash and shares, is to make a seismic shift in the way it operates. A three-pillar strategy, revealed by CEO David Kirk in a five-page document circu- lated to staff, outlines the massive changes and the broad timetable that will speed up the ongoing transformation of the company into a fully integrated digital media publish- ing operation. Included in the announcement was the news that Fairfax's two flagships, The Sydney Morning Herald and The Age, are to switch to a narrower page format and that 35 subeditors and layout staff would be cut from the Herald and Sun-Herald as "part of a reintegration of production staff across the two papers." The overall restructure of the operations is aimed at ensuring that Fairfax will expand and increase its profitability rather than be weakened by the growth in new media distribution platforms that are challenging traditional newspapers. What that means, says Kirk, is that "our newspapers have to be stronger, our internet businesses have to be stronger and that what we produce for publication is fully shared across platforms in an integrated fashion". The three pillars of the strategy are : de- fending and growing the newspapers; rapid growth of internet earnings; and building a digital media company by adapting the me- dia products, working processes, systems and organisation to the new converged world of digital media. For the newspapers, there would a continuing focus on editorial excellence, subscriptions and effective promotion. This had already driven growth in circulation and readership. "Distribution and production are improving all the time and cost manage- ment has been excellent," says the strategy document. "Finding advertising sales growth has been hard work in the current environment, but we have worked creatively to get the best out of a soft market." But better operations performance alone would not be enough to position the print publications for the long -erm growth need- ed. So acquisitions and new initiatives had been had been used to reshape the portfolio of print publishing assets, with a focus on regional newspapers, newspapers with unique specialist content and magazines. On the internet front, Fairfax had made the major and very successful acquisition of Trade Me and developed a wide range of online business. In Australia it held the top spot in news and information and the recent launch of the brisbanetimes.com.au (the company's online only news site) had been an "unprec- edented success." The company also led the field in dating and holiday rentals, and held a strong second position in jobs, homes and vehicle classifieds. A successful online entertainment strat- egy was being rapidly implemented and the travel strategy was moving fast, online hotel bookings had been launched and online flights and cars were on the way. Overall, Fairfax Digital's contribution to Fairfax Media's profit had grown from one per cent to 14 per cent in two years and there was much more to come. Kirk said the third priority of build- ing Fairfax into a digital media company would be done by "adapting our media products, working processes, systems and organisation to the new converged world of digital media." It was important to appreciate that Fairfax was growing and expanding its reach. "Taken as a whole, we have more readers than ever before and reaching more people than ever before. "They are reading -- and more and more are watching -- our journal- ism over more media platforms than ever before." But in this new world, the fundamental mission of Fairfax remained the same -- as it had been for Fairfax for 175 years -- "to in- form, challenge, shine a light, report, review and surprise by excellent news gathering, editing, design and distribution." "However, as the supply of news and information and other content proliferates, and as demand fragments over multiple distribution channels, our products, our technologies, working processes, physical surroundings, attitudes and behaviours have to change, because fulfilling our mis- sion has now inherently become a multi- media challenge and a dialogue between us and the audiences we serve. That is what we have to continuously drive and manage. "The way forward is to aggressively posi- tion Fairfax Media for a future defined by becoming a fully integrated digital media publishing business. "Our working processes -- editorial, ad- vertising and production -- need to change and become integrated across media." Kirk said that the proposed integration of the SMH and The Sun-Herald through a seven-day rostering and production struc- ture for subediting, design and graphics, would greatly streamline production and achieve greater quality and efficiency. The distinct culture and integrity of the two mastheads would be fully maintained. All the changes would mean Fairfax would be leaner and more efficient in how it produced its publications, and richer in the content, scope and scale of its journalism. On the switch to narrower pages, Kirk said broadsheets had been the "currency" for 175 years and the company was sticking to them. "But size does matter, and it is time to give our readers what they keep telling us they want: a slightly narrower broadsheet so that then can spend more time with our newspapers. "We are making these changes from a position of strength. Our circulation and readership are growing, our editorial impact is as strong as ever. "The move to a narrower broadsheet is not simply about size or design, but part of a comprehensive effort to conceive and implement the newspaper of the future -- with the needs and preferences of our readers and advertisers in the forefront of our thinking. "The move to One Darling Island and the impending move in Melbourne to new headquarters for The Age give us a unique opportunity to strengthen our mastheads, expand our digital businesses, and build an integrated digital media company." The big reshape of Fairfax Media By Jack Beverley Fairfax Media CEO, David Kirk has revealed a three-pillar strategy to transform the company 's digital operations. Picture: Fairfaxphotos.com