Media: Times are toughest when sales are falling

Following the settlement of the libel battle between Michael Ashcroft, the Tory Treasurer, and `The Times', some observers believe the paper's editor will be for the chop. Not so, says a former Murdoch editor - or at least, not unless he fails to stem the declining circulation

In the harsh, uncharitable world of Fleet Street there is no finer sight than a rival - or even a colleague - falling headlong from the top window of a high-rise building. So when news broke that Rupert Murdoch had personally stitched up a deal with Michael Ashcroft, the Tory treasurer, to withdraw his libel case against The Times, it was naturally assumed that the editor of the newspaper would be for the chop.

When it was revealed that the deal had been brokered by another newspaper editor whom Murdoch is known to admire, the rumour-mill concluded that he would be gone before Christmas. The gossip moved on to speculation about who would replace him. But reports of Peter Stothard's demise are much exaggerated.

Not for the first time, Fleet Street's demonology of Murdoch has clouded its judgement and led to the wrong conclusion. Murdoch is capable of many things in dealing with his editors, but he does not normally go behind their backs to undermine them. At least, he never did so in the 11 years that I was one of his editors.

Nor does he surrender to legal threats to save money. When I once agreed to a grovelling page-one apology to avoid having to withdraw an issue of The Sunday Times colour magazine that had already been printed, I thought he would welcome the fact that I had saved him a small fortune in advertising revenue. Instead he rounded on me for sacrificing the reputation of the newspaper for commercial considerations. It was my job to protect it, he hissed; he would look after the revenues.

Murdoch was worried that The Times would not be able to make its case against Ashcroft stick in court; implicit in its relentless, almost obsessive investigation into his affairs was the notion that the Tory Treasurer was a dodgy character with unsavoury (if unspecified) links to drug-dealing and money-laundering.

But the paper lacked hard evidence to back up its suspicions. Ashcroft's lawyers were advising him that his case was cast iron. The Times' legal team was beginning to worry that it was heading for an expensive and embarrassing mauling. Even then Murdoch did not intervene to insist on an out-of-court settlement. It was Ashcroft who blinked first.

The Tory leadership had already told him that it did not relish a bare- knuckle battle with Murdoch's flagship paper in the run-up to the next election. The prospect of living through a relentless media circus similar to that currently surrounding the Neil Hamilton/ Mohamed Al Fayed libel case depressed Ashcroft and made him less bullish. He decided to sue for peace, direct with Murdoch.

Ever the opportunist, Murdoch jumped at the chance of such a settlement. But he informed Stothard that he was in contact with Ashcroft the moment it was clear a deal could be done on acceptable terms, and made sure that his editor was fully involved in drafting the final peace settlement. Whatever initial fears Stothard had that deals were being done above his head were quickly dispelled.

Indeed, he had every reason to be grateful for Murdoch's intervention. There was too much bad blood between editor and Tory Treasurer for them to concoct peace between themselves. Murdoch had managed to agree a deal that required no apology or payment - just the clarification that The Times had not wished to imply certain nasty things about Ashcroft that it could not prove.

Honour was satisfied on both sides, though Stothard emerged the winner on points. Ashcroft had settled for much less than he believed a court would have given him, because he had reluctantly concluded that a libel trial would derail his political ambitions. But Stothard must also have breathed a sigh of relief; thanks to the intervention of his proprietor, he no longer risked being impaled on an expensive legal hook.

Amid the dark, unnecessarily unpleasant times of having Murdoch as your proprietor, there are also times when, as an editor, you think you have the best owner in the world. For Stothard, this must have been one of them. Now both proprietor and editor can concentrate on dealing with the real enemy at hand: The Daily Telegraph. That is not proving as easy to beat as seeing off Ashcroft.

Sales of The Times have been in gentle but steady decline for most of this year (bar the usual summer slump and autumn recovery) since price- cutting ceased to be the main circulation growth strategy: from 746,000 in January to 720,000 last month. The fall is hardly precipitous and sales of the Telegraph have also been nudging downwards, but not by as much. So the gap between the two papers, which Murdoch has spent much treasure attempting to bridge, has widened rather than narrowed.

Between June and November last year the Telegraph sold an average of 299,000 daily copies more than The Times. During the same months this year the gap has widened to 317,000. Not enough to settle the circulation war between them in the Telegraph's favour, but enough to make them wonder in Wapping what to do next.

Stothard's strategy of making waves and causing controversy (something The Sunday Times used to do) has made for some entertaining copy; but trying to destroy Ashcroft or stop Greg Dyke from becoming director general of the BBC has not sold papers. Moreover, Murdoch's appetite for controversy is less than it was and he tires of editors who cause too much of it, as I discovered when my fight with Malaysia over the Pergau dam proved to be one row too many. It has not escaped his notice that sales of The Sunday Times are at record levels without it.

The new Times arts and entertainment section has been an attractive addition, but printing constraints mean it has to be buried in the second section between business and sport; so something of huge interest to potential female readers is lost between male-dominated pages. It needs to be a separate section if it is to generate more sales. Murdoch's preference for printing "collect" (a method, popular in Australia, of printing two sections of equal pagination, which produces more colour sites for advertisers) forbids it.

Stothard's Times has many strengths. Its op-ed spread of editorials, columnists and letters is, in my view, the best in the business (though the new, third page of commentary has yet to find a purpose). Its news and feature pages are lively and entertaining. But they are increasingly driven by a middle-market agenda that puts off more serious readers.

And there's the rub. Sales of The Times have almost doubled since 1993, not solely thanks to price-cutting. The paper has also made a determined move into what might be called "Daily Mail territory". This has attracted many more middle-market readers; but it also deters converts among those who regard the Telegraph's pages as more substantial.

Stothard, of course, has the intellectual capacity to provide more rigorous news and features, which would compete better with the Telegraph. But to do so would risk losing all those middle-market readers who have been attracted by the price cuts and more accessible content of the newspaper. That is a circle that neither the editor nor the proprietor of The Times has yet worked out how to square.

Murdoch has spent too much money on increasing the circulation of The Times to be content to trail the Telegraph by 300,000 for ever. Stothard will be vulnerable if sales drift below 700,000, as they could on present trends some time next year. It is then that Murdoch is likely to decide that it is time for a new man (or woman) and new measures.

He will not move until he has determined what these new measures should be, which is why Stothard's job remains secure for now. When he does go, his editorship will be seen as a success; he has taken his paper from distant also-ran to the Telegraph to within shouting distance of it. But it looks as if it will take somebody else to go the final mile.

Murdoch will not be ruthless when the time comes. He rightly thinks highly of his editor, and will no doubt offer him another position in the Murdoch empire. This is as it should be for someone who has delivered. But, from my own experience, I do not advise Peter Stothard to be tantalised by any offers to anchor a show on Murdoch's US television network.

The writer is publisher of `Sunday Business' and `The Scotsman'