Tim Bowdler: The regional press baron who's got news for the City

Like Frozen turkeys and mother's ruin, local newspapers are becoming a thing of the past. At least according to the Government's statisticians - those numerical boffins who decide what items are in and what are out of the retail price index, that iconic, if arguably flawed measure of the cost of contemporary living.

Like Frozen turkeys and mother's ruin, local newspapers are becoming a thing of the past. At least according to the Government's statisticians - those numerical boffins who decide what items are in and what are out of the retail price index, that iconic, if arguably flawed measure of the cost of contemporary living.

So out with the local paper, bottles of gin and the Bernard Matthews Christmas staple and in with mineral water, digital cameras, regional cheeses and even acoustic guitars.

I have to say, I haven't noticed a marked reduction in the level of turkey or gin consumption in my household. They seem as relevant now as at any time in the past. Maybe I'm just not with it anymore. But as for local newspapers, I find it hard to believe they are any less relevant to a basket of goods designed to reflect our buying patterns. Nevertheless, out of the RPI they went last week.

"And yet you look at local newspaper sales and they have been going up for seven years," says a vexed Tim Bowdler, the chief executive of Johnston Press, the Edinburgh-based local newspaper group founded in 1767. On Wednesday, Johnston announced profits up 38 per cent to £128m and sales of its many local newspaper titles up 15 per cent to £491m.

"In fact, the reality is that more than half our titles have seen sales increases in that time," he says of a business which two years ago splashed out £560m to buy Regional Independent Media (RIM), a rival group which brought with it such famous daily newspapers as the Yorkshire Post.

So what's going on? Has the Office for National Statistics got it wrong? Well, it seems it's all part of another oversight by London-centric intellectuals misunderstanding what's going on, not just in middle England but the whole of the United Kingdom.

While the hordes of City-types living in London have spent the past three years bawling into the Bollinger, quaking in fear of losing their jobs or bonus or both, things have been a bit different in local job markets. And even though the luvvies of London's ad land have been crying over the worst national advertising recession in living memory, local advertising has witnessed rather different trends.

"It tells you, I think, that local newspapers are a very good barometer of consumer confidence," says Mr Bowdler. "If you go around the country to places a long way from London, then throughout this recent substantial downturn in the City and the media industry you will find that the consumer has been, on balance, positive.

"He's been in the property market, he's been buying cars and shopping on the high street. And he's been in work. People have been getting their salary rises. There's a big difference."

It seems that in Britain's towns and cities, the sounds of London's kvetch falls on deaf ears, thankfully. "Our advertisements are not aspirational. They are about doing real things. They are about selling houses or cars or recruiting someone to fill a vacancy. In the real economy at a local level, these things are continuing," says Mr Bowdler.

Anyway, as the rest of Britain gets on with its life happily ignoring the anxieties and pretensions of the capital, business is booming for local papers.

But with local newspapers come local passions and Johnston Press has been portrayed by some as a big, bad management machine squeezing valuable local assets for as much cash as possible, slashing costs and upsetting the balance of life on a local. None more so than on the Yorkshire Post, that bastion of the white rose county, which has endured some serious spasms of discontent since Mr Bowdler took it over with the RIM acquisition in April 2002.

The following November, Tony Watson, the long-standing editor, resigned, prompting some media commentators to point to Johnston Press's management style - a style that was searching for £9m of cost savings - as a possible contributory factor.

Mr Bowdler reacted angrily to the claims, which were printed in The Times, firing off a letter defending his company's record on investment in editorial quality.

Since then a new editor, Rachael Campey, a former Times journalist as it happens, has arrived in the hotseat at the Leeds-based paper. She is the first woman to hold the post and embarked on a revamp of the title. But she has had to endure a vote of no confidence from her own journalists after telling Jill Armstrong, the paper's women's editor, that her post was being axed.

The motion of no confidence went unopposed at the paper's National Union of Journalists meeting and a ballot on industrial action was threatened. The crisis was calmed after Ms Campey moved Ms Armstrong to a monthly magazine elsewhere within the group.

"If you look at the paper and the evidence on sales then the paper has made improvements. She [Campey] has got real ideas. There was a local spat around a change in one particular job that was blown out of all proportion. It was unfortunate and unhelpful," says Mr Bowdler. As a footnote, those £9m of savings that Johnston reckoned it could get from RIM are more likely to be £11m, according to Mr Bowdler.

Anyway, it is these kind of editorial issues that he likes to steer clear of. Indeed, those who work closely with Mr Bowdler say a large part of his success is down to focusing on issues such as printing costs and staff ratios rather than getting involved in anything editorial. Certainly his knowledge of newspapers when he was interviewed for the job would not have filled the space of a small ad in one of the company's newspapers.

"They wanted to find someone who knew nothing about newspapers and they couldn't find anyone who knew less than me," he remembers. Hailing from Wakefield and with a Swedish wife, Mr Bowdler is not the dour Scot many assume, although he is now happily ensconced in Edinburgh running the business. He fell into the job by accident, he says, having previously been involved in building materials with a company called Cape.

"A headhunter asked if I was interested in running a plc and I said yes. They said newspapers and I said don't be daft."

But the association has been a happy one - the grumbles of Yorkshire Post traditionalists notwithstanding. The company has been one of the best performing media stocks in recent years, thanks partly to its focus only on regional newspapers and in particular weekly titles which have proved the most profitable.

Although the RIM deal in 2002 was bigger, arguably a more important deal strategically was the acquisition in 1996 of EMAP's regional newspaper business for £211m. "In my mind that was the most transformational deal for the company," says Mr Bowdler.

There will be more deals to come if, as he hopes, the Competition Commission takes a more enlightened and, in his view, realistic approach to newspaper mergers but at the moment there is no sign of that happening. If Johnston Press does run out of room to manoeuvre, this could prove a real frustration to Mr Bowdler's ambitions.

Local newspapers may be out of the RPI calculation but they are still very much in the calculations of Mr Bowdler and his empire-building strategies.