The news that Independent News and Media South Africa had been sold to Iqbal Survé and his Sekunjalo consortium has been greeted with relief, mostly because the newspaper group is ‘coming home’ after years in brutal Irish hands that stripped its assets and saw over 3 000 people lose their jobs. But there’s also a sense of relief because Survé is already making the right noises about ‘investment’ and an ‘independent editorial board’ and an ‘editorial charter’, all things the beleaguered staff would find reassuring.
“Potentially the fact that the company has ‘come home’ is very good news for journalism in South Africa. The group was subjected to over a decade of cost cutting and profit extraction by its Irish owners, leaving the group a shadow of what it was, or what it could have been had it remained locally owned. So the change of ownership has the potential to reverse some of these extremely negative trends,” says Professor Jane Duncan, Highway Africa Chair of Media and Information Society at Rhodes University’s School of Journalism and Media Studies.
But, she says, there’s “too little information is available about the consortium yet to be able to say much else about it. The details of the breakdown of the consortium must be publicly announced. But what bodes well is that the consortium is promising to reinvest in the company and the journalists, and to guarantee editorial independence”.
William Bird, director of Media Monitoring Africa, says it’s hard to see how the new owners of Independent Newspapers could be worse than the Irish Independent News and Media (INM). “The Indy group had basically kept the Irish group going, and in return what did they get? They stripped the newsrooms, didn’t replace the presses, retrenched and pretty much took the Indy titles for all they had – and at the same time still expected them to keep on being their cash cow. So short of owners coming in and selling all the titles off and destroying the papers completely – it is hard to see how new owners could be worse.”
It won’t be an easy ride for Surve and his group. Globally, print media is having a tough time as digital media takes its toll, and locally, Independent’s financial outlook isn’t upbeat. Business Report editor-at large, Ann Crotty, in an earlier story in The Media and The Media Online said the the “weakness in INMSA was particularly striking at the operating profit level. In Rand terms, operating profit was down 34% reflecting operating margins of just 12.2% – a level not seen by INMSA in over a decade.” Operating costs increased by 5.4%, which was deemed a good performance “given inflationary cost increases in excess of 7% experienced across the board”.
Surve, however, is unfazed. He told BDlive it was a good deal (the price tag was R2 billion). “We have bought at the right time. If we had to have bought this company two years ago, we would have had to pay double the price.”
Duncan believes there’s hard work ahead to restore many of the group’s newspapers to their former glory. “The newspaper group is ailing, and lacks a distinctive content proposition to take it into the digital age; it needs to refocus on quality journalism and tell the stories that remain underreported or even unreported in the country, and the group is well positioned to do just that,” she says.
The group has 18- paid-for newspaper titles – including the increasingly popular Zulu- language Isolezwe, The Star, the Pretoria News, Cape Argus, Cape Times, Daily Voice, Daily News, The Mercury, Saturday Star and Sunday Independent.
Duncan says the reach of the titles has “not been optimised”. “The new owners will need to attend to this problem as an upmost priority. The news of plans to expand into the region should be viewed with some caution, though, as these plans may lead to the challenges at national level being de-prioritised in favour of regional expansion,” she says.
Clearly, Surve is on the same page. He told the Daily Maverick he saw the newspaper group as a platform to expand into Africa’s media sector. He’s also upbeat over the success of titles such as Isolezwe, saying the team that built the title in KwaZulu-Natal had “done a phenomenal job”. He believes he can “take that same model and replicate it in Limpopo, Free State and the Eastern Cape, and it is not just about making commercial sense – it is also about the heritage of languages”.
Wadim Schreiner, CEO of Media Tenor, says it “is good to see the uncertainty lifted over an industry that is grappling with a lot of issues. This is a sign of confidence into the industry and particularly the print media”.
Bird concurs. “That it is in South African hands should also have a positive impact on the transformation agenda of the print media. I’m not sure what the BEE status is but it will certainly be much better than it was, so that’s good news. The rumours of their being some trade union ownership is a good thing and I really hope the trust that some of the journalists were trying to set up is also in the picture as it would be a really positive for the journalist to have a share in the company they work for.”
The Media Online was unable to establish if the Indie Workers’ Trust, set up with the powerful Media Workers Union of South Africa (Mwasa), had succeeded in their aim to win a 25% stake in the new company. Ann Crotty and Tuwani Gumani of Mwasa had not responded at the time of posting.
Of course, editorial independence is what is on the minds of many. Surve has links to the governing ANC, an organisation that is often at war with the media. Surve insists he is independent, his own man and editorial independence is a given, but that reporting should be balanced and fair.
Duncan says it would be “prudent” for the new owners to “conclude an editorial charter with the staff to guarantee editorial independence. The press has become a battleground between the ANC and journalists, and an editorial charter will reassure both journalists and readers that this sale is genuinely in the interests of journalism, rather than a continuation of the war against the press by other means,” she says.
Bird hopes the media landscape will shift as a result of the Sekunjalo buyout. “If the new owners opt to go for an editorial position that is more favorable to government then it will be up to them to ensure people will buy the products,” he says. “That said some of the titles have been around a really long time, and their values are deeply entrenched, so it is doubtful that a change in ownership will result in too significant a shift in content.”
Schreiner says he has met the new owners and “they strike me as having South Africa at heart – this is certainly good for the future direction of the business. Also, Sekunjalo is run professionally but people with great experience – that as well should be a benefit for the Independent Group”.
Glenda Daniels, author of book Fight for Democracy: the ANC and Media in SA and senior lecturer at Wits Journalism, says she hopes the Sekunjalo will “keep their hands off editorial, pay journalists better and pocket fewer bonuses and hefty pay checks for themselves.” She also wonders “what Surve means by ‘balanced and Fair’. I hope it does not mean interference. In addition, I’m a bit surprised to hear of expansion plans. Globally and locally print circulation is down,” she says.
Surve told the Daily Maverick Sekunjalo’s bid was the lowest INM received. His consortium paid £170 million, R2 billion in the rand equivalent. Is the price appropriate.
Bird says it seems fair “if anything too high, but that is just my justice bias kicking in and not business”.
But he doesn’t think the investment will end there. “I think the new owners will have an incredible challenge on their hands and we hear they are planning to shift to vernacular language and more digital – two areas which they have some success in but in neither are they market leaders. I imagine there will need to be a lot of investment in the group and its operations.”
Schreiner says he cannot comment on the appropriateness of the price. “I assume due diligence was done and this was the result that parties felt was fair. It seems a good price, one that will allow for further development of the group.”
It’s an exciting time in South Africa’s print media, with many changes taking place in a few short weeks in 2013 after what has seemed like a stagnant time for print. With all the movements at Times Media Group, and now Independent Newspapers finally back in South Africa hands, the media landscape looks set to shift.
Last word from Bird: “I would like to see them come in and engage the staff of the existing titles on where they think the group should go, how can they make digital a success, and how to they expand on the work of Isolezwe. They should ensure that they build best practice system for separation of editorial from ownership and they should take transformation not as a dirty concept but as something that can help take the organization into a new bright future, to transform across the board, not just owners, but as part of their overall agenda. This is a very exciting time where they really can shape something really South African that takes into account our challenges, our inequalities, diversities and stories.”