Will anything come from a resumption of talks between Trinity Mirror and Richard Desmond, owner of the Express newspapers and OK?
Sooner or later there’ll be a major rationalisation of Britain’s national newspapers, as there has been in local papers, not least by the Mirror buying the Local World chain a couple of years ago.
All sorts of remedies have been suggested including the current Project Juno which envisages most of the papers being sold by the same sales force. That has all sorts of problems though: would it increase revenue and how do you carve it up? Then there’s competition legislation.
In this instance the respective leaders of both businesses, Simon Fox at the Mirror and Desmond at the Express, have proved expert at wringing profits out of declining assets (although Desmond’s Health Lottery remains, gratifyingly, in the red).
But, sooner or later, the profits will evaporate in line with the national newspaper market. A whole generation is growing up with no desire, let alone loyalty, for newspapers. The guys giving away London’s Evening Standard at Oxford Circus spend more time talking to each than saying “thanks guv.” Most passengers are more than happy to scrutinise their phones.
It’s not all about print of course and the Mirror’s Fox has done well to increase the company’s digital revenues as he has. But online ad sales will never enjoy the price (and hence margin) of the print of just a few years ago. A further problem is that most of the money going into online ads finds its way into the coffers of the likes of Facebook and Google who dispense free news (free to them that is) as they aggregate it from hard-pressed publishers.
Fox, who once had the chance to be CEO of ITV but chose to stay at HMV, is a capable manager and may just be able to co-exist with maverick Desmond. A combined Express and Mirror might work for a few years if they can create one staff producing the range of dailys and Sunday they now do independently. If they could put the two operations together with the Telegraph they might just have the chance of creating something sustainable in the long term.
That, though, would require a big and brave investor. Amazon’s Jeff Bezos (now owner of the Washington Post) anyone?