THE MEDIA YEARBOOK: Daily newspaper circulation continues to decline, according to Audit Bureau of Circulations (ABC) third quarter results for 2014. Their numbers fell by 66 000 copies compared to the previous quarter, representing a 3.2% decrease, says the report. The Media reports.
The daily that showed the largest growth compared to the corresponding previous period is The Herald, which increased by 2.45% from 21 446 to 21 972 copies. However compared to its performance in the previous quarter (22 987 copies), the newspaper’s circulation is down.
The dailies that took the biggest knock compared to last year’s quarter-three results were The Star (from 100 804 to 84 785), Pretoria News (from 17 194 to 15 124) and the Daily Sun (from 291 132 to 262 431).
During this period, weekly newspapers’ circulation increased by 35 000 copies compared to the previous quarter. Circulation of weekend newspapers declined by 5.7% (534 000 copies) compared to the corresponding previous period. Compared to the previous quarter, however, they declined by 67 000 copies (3.9%). The weekend newspaper with the largest growth was the Saturday Dispatch, which increased from 19 561 to 21 241.
Local newspapers’ circulation has declined by 3.2% (65 000 copies) compared to the third quarter of 2013. Compared to the second quarter, however, their circulation has remained static.
In his presentation of the third-quarter results, ABC vice chairman Gordon Patterson remarked that a closer look at the Advertising Media Forum (AMF) ‘core circulation’ definition reveals that “there are several titles performing fairly well” and that “the most severe declines are clustered into one publishing group and most likely linked to an effort to cut non-profitable distribution”.
According to Patterson, print still has a lot going for it. “Print still works because we have lost the peripheral reader, who is not the core reader. Core readers are the most valuable from an advertiser point of view. While print has become smaller, its value hasn’t diminished by the same proportion,” he told The Media.
In his presentation, Patterson also citedauditing firm Pricewater-houseCoopers (PwC), whose ‘Entertainment and Media Outlook: 2014–2018’ report said newspaper circulation has started growing again.
“South Africa continues to buck the trend seen in other nations, with revenues increasing across the board, in both print and digital. This is achieved due to the buoyant and diverse newspaper publishing industry in the country,” notes the PwC report.
The MediaShop’s group managing director Chris Botha disagrees. “I’m not sure I believe AdEx’s numbers, so I don’t think we are really bucking the trend,” he explains. “Online is not huge yet (in South Africa) so we still need newspapers to get reach in the lower market.”
As for local newspapers, Botha says they still have a good future. “There are still large markets in South Africa that don’t have a newspaper for their area. For them, a free newspaper is essential.”
Patterson says media owners
have long ignored the fundamentals of the business and now they have to “rightsize”, which they are doing from the bottom of the pyramid. “What they need to work through and realise, ultimately, is that we need fewer managers (and) more leaders, and workers who are talented and able to deliver,” he says.
Blood on the newsroom floor
Times Media Group (TMG) went on another spate of retrenchments in 2014 as the company’s titles were told to “shave millions of rands off their budgets”, reported Grubstreet in November 2014.
The website revealed that the Sunday Times, The Times, Sowetan, Sunday World, Daily Dispatch and The Herald were retrenching staff, while Business Day and the Financial Times were facing a job and increase freeze.
Just before this news was made public, Bloomberg reported that the Sunday Times was cutting jobs because it was not achieving its budget projection. The newspaper had to reduce its budget by R10 million and staff earning more than
R700 000 a year would not get a raise. This followed the announcement in July 2014 that TMG had retrenched 11 photographers from the
Sunday Times and The Times.
RamsayMedia retrenched 24 of 177 staff members in 2014, a move that had nothing to do with the company being sold to Caxton in 2013, RamsayMedia chief operating officer Werner Schmidt told Grubstreet at the time. The aim, instead, was to be an integrated company as opposed to having different brands operating in silos.
The State of the Newsroom (SoN) 2014, a report put together by Wits University’s Journalism school, revealed that 596 people in media were retrenched between July 2013 and July 2014. Media24 retrenched 446 people in the period.
Independent Media also cut back staff in 2014, retrenching 30 of its 100 permanent sub-editors and ditching about 50 of its freelance sub-editors. Those remaining had to reapply for their jobs and take pay cuts. In December 2014, Independent Media settled a wage and bonus dispute with unions SATU and MWASA, averting protected industrial action by staff. Chairman Dr Iqbal Survé thanked unions and management teams for the “constructive” way the dispute was handled.
Trouble at Independent
In 2013, Independent had been sold to South African media firm, Sekunjalo Independent Media, a consortium led by businessman Dr Iqbal Survé. Sekunjalo’s controlling stake in the
company was partly funded by the state through the South African government-owned Public Investment Corporation (PIC) and the Government Employees Pension Fund (GEPF). Among others, its stakeholders also include a trust linked to the ANC’s Umkhonto weSizwe Military Veteran’s association, Nelson Mandela’s controversial grandson Mandla Mandela, and South African Brics council representative Sandile Zungu. These political ties raised concerns about the company’s editorial freedom.
In December 2013, Cape Times editor Alide Dasnois was suspended and later dismissed after commemorating Nelson Mandela’s death using a wrap-around instead of the front page. In its place, she led with a story on a Public Protector report, titled ‘Docked Vessels’. The report accused former fisheries minister Tina Joemat-Pettersson of irregularly awarding a tender to Sekunjalo to manage the state’s fishery vessels. Dasnois’ case was still being heard at the Labour Court at the time of writing.
Dasnois’ departure set in motion a string of other dismissals and resignations. In January 2014, group executive editor Chris Whitfield announced his resignation, saying that he would be taking early retirement. Two months later, Cape Times assistant editor and head of news Janet Heard resigned.
Labour columnist of 18 years, Terry Bell, was given the axe and shortly after Sunday Independent editor Moshoeshoe Monare resigned to become deputy editor at the Mail&Guardian.
In October 2014, Cape Times opinion page editor and journalist Tony Weaver was called before a disciplinary hearing after questioning a suggestion to crop out
the logo of an advertiser from a news photo of a mall robbery. Other columnists, like Max du Preez and Allister Sparks, have since left.
During 2014, Survé was also involved in a public war of words with Mail&Guardian owner, Trevor Ncube. The fight was sparked by a story in The Star that said the Mail&Guardian was facing a cash crunch as a result of being used to subsidise Ncube’s poorly performing operations in Zimbabwe.
In November 2014, Survé announced his resignation as executive chairman of Sekunjalo. He will, however, remain the chairman of holding company Sekunjalo Investment Holdings, which is a controlling shareholder of Sekunjalo. Some onlookers have said the move
is an attempt to divert all the negative attention Independent had recently received. Others said it signalled an attempt by Survé to become more involved in Independent Media.
Anton Harber, Caxton Professor of Journalism at the University of Witwatersrand, says what is happening at Independent and other media houses may indicate signs that South Africa has adopted a different approach to dealing with the media. Instead of open, public tactics like the threat of the Secrecy Bill, they are using state power to influence owners and editors.
Asked why the government is changing its game plan, Harber says he believes it’s because they were not making progress with the controversial Secrecy Bill and so they needed a more sophisticated approach. “Some of this stuff is legitimate: everyone tries to influence editors and owners,” he says. “Where you have a problem is when they use state resources (to do it). You have to try and stop that on a legal, constitutional basis.
Caxton and Media24 slug it out – again
Longstanding rivals, Media24 and Caxton, were also at loggerheads in 2014.
Caxton was accused of disrupting the merger between Media24 and Paarl Media Group after it was granted permission by the Competition Tribunal to participate in the merger proceedings of the two companies. It also ordered Media24 to submit information about parent company Naspers’ indirect and direct shareholders.
Media24, which owns more than 80% shares in the Paarl Media Group, wanted to buy the remaining shares from non-executive chairman, Lambert Retief, who wanted to retire.
Harber says it is significant the deal was called off. “I suspect that they are vulnerable to scrutiny of their ownership on a number of fronts – political and regulatory.”
Sapa’s money woes
Another media entity in the spotlight in 2014 was local news agency, the South African Press Association (Sapa), which was almost discontinued when it looked like its funding from major local print media houses would run dry.
TMG resigned as a member and print subscriber in January 2014 but continued using Sapa for its digital platforms. Caxton resigned in July and Independent Media said it was planning to do the same in November 2014. This meant the companies would still be subscribers to the service but they would no longer have to be funding members, leaving only Media24 to play this role. As a result, a new financial model for the news agency had to be explored.
Minette Ferreira, the new chairwoman of the Sapa board, announced in February that Sapa would file its last story at midnight on 31 March 2015.
Update: Media24 has now announced it will be launching a wire agency, and so has Independent Media.
The common thread that runs through all these major 2014 developments is that of money, or rather the lack thereof. As local and global economic circumstances aren’t forecast to improve any time soon, the future of newspapers – and indeed media in general – is a concern.
This post was first published in 2015 The Media Yearbook. A digital version of the full magazine can be downloaded here.