Martin Dunn: Murdoch's rival for the Apple

News Corp is pulling every trick to win New York's newspaper war. Martin Dunn, leading the 'Daily News' counter-attack on the 'Post', talks to Edward Helmore

"Don't look," says Dunn with a part-amused, part-weary air of resignation. Dunn (whose name keeps coming up in connection with the editorship of the Daily Telegraph) recognises the poster as a classic Murdoch stunt. He was a faithful News Corp lieutenant for much of the Eighties and early Nineties (as deputy editor of the Sun under Kelvin MacKenzie and then as editor of the now defunct Today) but has spent much of the past decade at the Daily News locked in a circulation war with the Murdoch-owned Post.

He tells his staff, who have only lately become accustomed to this kind of psy-op warfare, not to let it get to them. "You have to react fast and have a thick skin... a very thick skin," he advises. Dunn can already say he has seen off Rupert's eldest son, Lachlan, who ran the Post as his fiefdom until 10 days ago, when he dramatically resigned from News Corp, to the immense disappointment of his father, who had been grooming him as his successor.

Lachlan had told the New Yorker that the duel between the Post and the Daily News was the "most exciting newspaper battle in America and maybe the world". Rupert himself is now said to have decided to personally take the fight to Dunn and Co by replacing Lachlan as publisher of the Post.

"It was a surprise when Lachlan resigned, as we had all believed the Post was his baby," says Dunn. "But after almost four years of price-cutting and huge investment in print technology it has still failed to achieve two big objectives: to become profitable and to overtake the News in circulation. We have fought tooth and nail against them, and we'll continue to do so. In an interview with Ken Auletta for his book Backstory, Lachlan admitted losses of $40m, but most in the New York media world think that the losses are greater than that. It is a huge amount of money to lose, and keep losing, and still not achieve your objectives."

The New York battle is being directed by foreign generals: the Post, commanded by Col Allan, an Australian News Corp veteran, with a British deputy (Colin Myler, ex-Sunday Mirror) and the News by Dunn (technically now editorial director) and another Brit veteran as his deputy editor, the Lancastrian Michael Cooke. "Brit journalists have a sense of competition that American journalists find difficult to comprehend," he says. "You have to remember that most US journalists come from monopoly towns, so it doesn't matter if a story goes in today or tomorrow or a week on Monday."

Dunn, 50, is on his third tour of duty in New York, having worked in the Apple once as a stringer and twice at the News, the New York tabloid with the highest circulation in the city, but which has taken a beating from its cross-town rival. Traditionally, the News is dominant in the boroughs (Queens, Brooklyn, Bronx and Staten Island) while the Post has a more uptown-downtown, Manhattan-orientated readership. But the Post has been encroaching on News turf.

After decades of losing out to the News in the circulation war, the Post has dramatically closed the gap over the past four years. While the News circulation has held steady at 750,000, the Post has gone from less than 500,000 to 680,000 by cutting its cover price from 50 to 25 cents.

The News, which is owned by the democratic-leaning property tycoon Mort Zuckerman, has also taken a beating in the PR war. The Post calls it the "Daily Snooze", and the News's Washington-imported gossip columnist it describes as "gossip-challenged". The News is fighting back with more vigour now and scored some memorable hits of its own - particularly after the Post published an editorial lamenting the Yankees' loss to the Boston Red Sox in the baseball World Series - when the New York team had in fact won.

WORLD CHUMPIONS! ANOTHER POST EXCLUSIVE, crowed the Daily News, which bestowed the "New York Knucklehead Award" on its rival "for ineptitude so breathtaking that it drew global laughter".

Dunn wasted no time in making the best of Lachlan's departure. His paper bitchily reported: "The Post was just one of Lachlan's huge headaches. The 33-year-old tattooed Murdoch heir also was feuding with his 74-year-old father over control of the News Corp empire, which includes the Fox News Channel and Fox TV network. Lachlan and three of his adult siblings are reportedly also fuming over their dad's attempts to change the family's $6.1 billion trust to include Rupert's present wife, thirtysomething Wendi Deng, and the couple's two young children."

"We were bashed and battered for a good two or three years," Dunn concedes over lunch at a midtown steakhouse where the waiters are pumped up like body-builders but delicate in their delivery. Dunn, who was editor between 1994 and 1997, was brought back 18 months ago to halt the Post's momentum and nurse the News back to fight-fitness. Already the paper is livelier, but Dunn says the makeover is "only about 60 per cent towards where we want to get it. We have plans for major investment and we're going to persevere with it. We want it to succeed."

When he returned to New York, Dunn was surprised to find people at the News who still believed Murdoch would find the Post's price-war losses (estimated at $20 million a year) intolerable and put the price up. "They thought, well, it's costing him a lot of money and he won't keep doing that.' But I know the plays, I know Rupert and the way he operates, and I know they're not going to put up the price. He's going to keep smacking me over the head with a blunt stick for as long as he possibly can."

But Dunn can take it. After serving as the Sun's New York correspondent, he worked under Kelvin MacKenzie throughout the Eighties when the paper, in rude health, was a breeding ground for future editors, sold about 4.2 million copies daily, and tirelessly promoted all that came to be known as Thatcherism.

Initially, Dunn came back to edit the Sun's Bizarre pop column ("which was truly bizarre because I'd been away for five years and knew nothing about pop music"). This was also the era of the musically inexplicable: Go West, Bros and Spandau Ballet. Dunn spent long nights hanging round nightclubs in London, living large on generous record company entertainment budgets.

He moved to features and then to deputy editor. "All the stories are true," he says. In one infamous incident he pretended to collapse when MacKenzie yelled at him for getting a story wrong about Boy George buying a house in Maida Vale. "I found out it was a George but not, unfortunately, Boy George. Kelvin went berserk, so I did this dead faint from the ankles in front of his desk. He leaned over his desk and carried on screaming at me."

Murdoch would drop by, unannounced. One evening, when Dunn was editing, the proprietor turned up on the floor. "It was 6pm and we had a story we were trying to turn into a splash but it was absolutely unexplainable. I tried to interest him in it, but I could see his eyes glazing over. He took me aside and said: 'If you can't explain it in five words, it's not a front-page story.' " Murdoch, he recalls, "loved the context of the paper, loved the competition and he loved trying to screw the Mirror".

While Dunn relishes a fight, he does not have the freedom to enter into a price war with the Post. Instead, he has set about reinvigorating the News, making it more aggressive, improving the packaging of stories and targeting the interests and concerns of its core readership more accurately. That means not trying to out-tabloid his rival. Before his return to the News, the paper was under fire for trying to out-celeb the Post. It didn't work and was widely criticised by media-watchers. Confronting Murdoch in this fashion, warned former News editor Pete Hamill, would be a replay of the cable news war, in which Murdoch's Fox News' flash presentation and shrill politics caused CNN to try to copy the Fox style and lose its way.

With Richard Desmond's OK! launching in America last week, backed by a huge ad-spend, there seems to be no end to the market for celebrity news. "All our research shows that every time readers say they want more serious news, but they'd be mortified if we started taking out the Britney Spears stories," says Dunn. "What they say they want and what they really want are two completely different things."

Compared with the rest of the US media and the foreign press, American papers have been slow to adapt to the needs of the consumer. "UK newspapers may not be doing great but they're a very modern product compared with papers in the US," says Dunn.

The lack of investment and innovation in the US business is showing up in the statistics. Business declined 1-3 per cent last year, the worst result since 1991 when 2.6 per cent of subscribers were lost. Rather than halt the decline with discounts and promotions, newspapers are seeking to expand into new markets, with The New York Times trying to attract younger readers with endless pieces about decorating, dating and metrosexuals.

Dunn says there's an opportunity for US papers such as the News to become more political and campaigning (something radio and television cannot do because they're tightly regulated by the Federal Communications Commission). With the Post so right-leaning, the News has the opportunity to go further left, although it seems unlikely that any media organisation in America can afford to be seen as actively liberal.

For Dunn, the challenge is to reconnect with Daily News readers who have drifted off. It can be a difficult mix to get right: the News is a local tabloid paper that must cover national and international stories. It used to be that US papers thought a report on, say, a scandal at City Hall was enough. Now, when there are so many sources for such news, papers have to do something else.

"Just reporting the news is self-defeating," he says. "British newspapers have developed a magazine quality to their coverage of news and of getting behind the stories, rather than just reporting them head on. We have to get into that kind of commenting, analytical kind of journalism here. One of the things I want to help Mort to do is to steer the paper toward becoming a voice and advocate and a campaigner. That's where the future lies... and it's a bleak future for newspapers if we don't."

The National Enquirer magazine recently imported a dozen British tabloid hacks to beef up its reporting. That's not an option for Dunn, who needs his reporters to know where Flushing Meadows and Ozone Park are. The trick is to provide something for the more insular communities (Russians, Dominicans, Koreans, etc) who are currently served by their own language media and have little interest in integrating further with English-speaking Americans.

But perhaps the challenge is not so different from that faced by the London Evening Standard in trying to cater for readers from Hackney to Barnes?

Like London, New York is increasingly factionalised and diverse. Rupert Murdoch has remarked: "New York is a strange, tribal city." The tabloids reflect that.

The Daily News began life in 1919 and within a few years became the largest-selling daily in the US. Its motto, "Tell it to Sweeney", encouraged a straight-forward writing style that would appeal to the working classes. By the 1980s, the News - like the Post - was in difficulties largely linked to labour strife. Murdoch offered to buy the paper but its owners, Chicago's Tribune Company, called the idea "an anti-competitive and predatory act". After a strike in 1990, the situation was so bad Tribune paid Robert Maxwell $60 million to take the News off its hands. Eight months later, he disappeared off the back of his yacht and the paper went into bankruptcy.

Three years later, after Zuckerman had bought the title, Dunn began his first stint as editor. He was well suited to the task. After a stint on various West Midlands papers (he remains an ardent supporter of West Bromwich Albion), Dunn came to New York in 1979 and set himself up as a stringer to the Daily Star, the Yorkshire Post and others, eventually becoming the Sun's designated correspondent.

They were, he recalls, fine times when there was still a hard-drinking culture for journalists, and the US beat was a proving ground for young talent. As he reminisces about Fleet Street's former New York pack, he mentions the likes of Daily Mail editor Paul Dacre, the Mail's showbiz writer Baz Bamigboye and the former Sun editor turned PR supremo Stuart Higgins.

"In those days, people were fascinated in American entertainment and news. Anytime you got a Dynasty story about Linda Evans, Joan Collins or Larry Hagman, boom ... a page three lead," he says. "There was an intense rivalry. We'd get callbacks at 6pm (11pm in the UK when first editions dropped) saying why haven't you got this, you kicked their arse on that..."

When Rod Stewart left his wife for another leggy blonde, the news pack chased him not just to the airport but all the way to the gate. "Baz [Bamigboye] went one step further and bought a first-class seat and sat behind him all the way to LA. It was great fun in those days and New York was a great learning place."

One of the Daily News tactics is to target new readers through the churches, by profiling a church from each borough every week. It's not Britney's bulge and it's definitely not Paris Hilton, but it is reaching out to readers and drawing them in on their specific interests -- in this case, presumably, God.

Another News-orchestrated campaign is the issue of alerting citizens to the presence of convicted sex offenders in their neighbourhoods. Last year, the paper ran a successful campaign against the notorious Joel Steinberg who had been released after serving 17 years for beating his adopted daughter to death.

For the News readership, the key issues are health, education, transport and the environment, including a regular feature called "Is my neighbourhood making me sick?" I suggest banning small dogs from the city in the high summer when the temperatures sit in the 90s and areas such as the West Village are enveloped by the stench of small dogs' pee. Dunn doesn't think this will fly, drily suggesting that there's probably an American Indian called Small Dogs Pee who'll sue the paper for discrimination.

Within a year or two, Dunn will want to return to Britain where his wife and his family remain (their youngest child suffers from Asperger's syndrome and is in a British school). This brings up the question of the Daily Telegraph and the whispers that he is headed for the editor's chair there. "I have no idea where they are coming from," he says. "You tell me."

Dunn has never met the Barclay brothers, but he knows Andrew Neil well and often swaps war stories and talks business with the Telegraph chief executive Murdoch MacLennan. Dunn suggests the rumours may have started when he invited MacLennan to speak at a media conference that he organised in New York. For the record, he says: "No one has ever asked me if I'd like to take a job at the Telegraph."

In the end, he says, there's really no difference between the problems facing US and British papers. "We just have to get over people's apathy toward newspapers, find the things that bring different communities together, try to get beyond the sheer reporting element of newspapers and introduce technologies that are going to make us modern and relevant.

"Rupert has one of the most brilliant media minds, and we would never make the mistake of underestimating him. But Mort is also driven and determined. Two billionaires in the same city each with a tabloid newspaper - it should make for exciting times."

And with that, it's back to war.

Going places

THE WEST MIDLANDS

1973 Starts work as a junior reporter on the Dudley Herald, later joining the Birmingham Evening Mail and Birmingham Post, leading to his first Fleet Street work with the Daily Mail.

STATESIDE

1979 An ambitious Dunn crosses the Atlantic and helps to establish the New York News Agency as a top source of freelance copy, supplying the Daily Star, Sunday Express and Yorkshire Post, as well as De Telegraaf (Holland).

CURRANT BUN

1984 Comes back to Britain to work for Kelvin MacKenzie's Sun. At first he works on the showbiz column Bizarre, later running the features department, running some of the big Sun promotions and developing political contacts.

KELVIN'S No2

1990 As deputy editor to The Sun's most famous and infamous editor, he helps develop promotional and editorial strategies for a paper selling in excess of 4m a day.

TODAY

1991 Dunn is hired to relaunch Britain's youngest daily tabloid newspaper. During an 18-month period, he increases the paper's circulation by more than 100,000. Today is named Newspaper of the Year in 1992.

BACK IN THE USA

1992 As the editor-in-chief of the Boston Herald, Dunn headed the 250-strong editorial team of Boston's leading tabloid newspaper, helping increase circulation by more than 50,000 in under six months.

THE DAILY NEWS

1993 Moves to the Big Apple as editor-in-chief of the city's biggest tabloid. Over the next four years, he introduces a new editorial style while building circulation. The newspaper wins its first Pulitzer prizes - the highest accolade in American journalism - for 35 years.

ASSOCIATED

1997 Back to Britain in the dot.com boom to create the New Media division of Associated Newspapers, the national newspaper arm of the Daily Mail and General Trust. He becomes managing director of DMGT company Front of Mind. Associated New Media launches several award-winning internet sites.

NEW YORK WARS

2003 Dunn is brought back to the States by the publisher Mort Zuckerman to mastermind the strategy in the New York Daily News circulation battle with Rupert Murdoch's New York Post. He is named editorial director and also becomes deputy publisher to Zuckerman himself.