In my new role as Cassandra for the newspaper industry – Cassandra as in King Priam’s daughter who had the gift of prophecy and the curse that no-one would believe her (she was right about Troy and Greeks bearing gifts) – we’d better have a look at the Mirror’s planned cut price 40p newspaper, New Day.
Cassandra is quite appropriate in a Mirror context. William Connor penned his famous Daily Mirror columns under Cassandra for thirty years or so. War service intervened and when he returned he began with: “As I was saying before I was so rudely interrupted, it is a powerful hard thing to please all of the people all of the time.”
When he hung up his quill in 1967 popular newspapers were in an era when the money rolled in, facilitating highly paid columnists and wall-to-wall boozing among other things (the amusingly-titled City Golf Club being one such institution). Gradually the money moved to TV but the likes of the Sun and, to a lesser extent, the Mirror did very well. The Daily Mail took over the profitable middle ground, long occupied by Beaverbrook’s Daily Express. The top end of the market was far less successful, only the Telegraph and the Sunday Times making money.
Anyway that was then. So is the Mirror mad to be be launching a new paper on February 29? Two supposed facts are worth considering. One is that the Independent’s i title, just sold to regional publisher Johnson Press for £24m, was a ‘success,’ however that may be defined. It sold 275,000 copies, latterly at 40p but for much of its life at 20p, and cost very little to run as most of its stories came from the heavily loss-making Indy. So a success on its own – but, of course, it wasn’t on its own.
Another is that, according to the FT, the Mirror titles gain only 13p in digital revenue for every £1 of print advertising revenue they lose. Fleet Street as a whole is estimated to have lost £110m in print revenue over 2015, with no signs that anyone can stem the swelling tide. This is equal to half the profits made by the UK’s national newspapers in total. Cassandra (Trojan version) would love that one.
Logically, therefore, digital revenue won’t save the UK’s national newspapers as we know them. The Russian Lebedevs, who launched i and still own the Independent, are now trying a digital-only model.
But can cheap, or even free, newspapers succeed? The Lebedevs’ free London Evening Standard (25 per cent owned by Daily Mail publisher Associated) is said, by the Lebedevs, to make £5m profit a year. This sounds a bit toppy to me but it appears to be a success. It’s certainly very welcome on the streets of London. Other free London titles like Shortlist and Time Out also seem to be doing OK. But London is a big rich market and spendthrift Londoners are hard to reach with other media. As the Lebedevs have found with their other venture, ‘local’ TV station London Live.
Mirror CEO Simon Fox (left) no doubt calculates that he can re-purpose Mirror editorial for New Day at little cost so all New Day will cost him is the paper (it’s apparently aiming for a settle down circulation of 200,000) and the promotion budget. If that’s the case it might make money on cover price alone. A circulation of 200,000 isn’t going to attract much advertising.
But will it cannibalise the Mirror at 60p? Fox’s cunning plan, it seems, is to make it more like the middle class Mail and Mail readers wouldn’t be seen dead buying the Mirror. Whether Mirror readers feel the same about the Mail we know not.
But here’s a warning from fairly recent history. Back in 2006 the mighty Rupert Murdoch empire launched, free, thelondonpaper (edited, as it happens, by former Campaign editor Stefano Hatfield who then went on to edit the i). This was a clear challenger to the Evening Standard, then a loss-making paid-for title owned by Associated. Associated then launched its own freebie London Lite, a dreadful rag, in competition. Thelondonpaper closed in 2009.
Associated had done this before, launching a free paper to compete with, and kill off, Robert Maxwell’s London Daily News back in the 1980s. Maxwell, piquantly, also owned the Mirror.
Now the Mirror’s New Day isn’t a London-only paper but London will certainly be at the heart of its plans. Associated also owns Metro, a free paper given away at London Underground stations and other transport hubs around the country. New Day may be seen as a rival to Metro.
Whatever, a mid-market New Day will be seen as a rival by Associated, which doesn’t take kindly to such upstarts, as we’ve shown. Mirror CEO Fox might be about to tweak a very dangerous rival by its tail.
