Stephen Glover: A decline in ads that's put the heat back on
Media Studies: If the advertising downturn goes on for long I fear some newspapers are in for a further battering
Monday 30 May 2011
If strong newspaper advertising is proof of a buoyant economy, George Osborne should be tossing and turning at night. For all newspapers 2010 was a year of recovering advertising revenues. Now there is clear evidence of a downturn in the first half of this year which is affecting even the strongest titles.
Last week Daily Mail and General Trust (DMGT) referred to "volatile and uncertain market conditions" in unveiling its six-monthly figures. Northcliffe Media, a division of DMGT which owns more than 100 regional titles, experienced a fall in advertising revenue of nine per cent year-on-year for the six-month period. Associated Newspapers, a DMGT division that includes the Daily Mail, the Mail on Sunday and Metro, reported a more modest five per cent year-on-year decline in advertising revenues for April and the first three weeks of May, though over the year, largely thanks to Metro and an ever growing Mail Online, advertising was up two per cent.
If a powerful company such as Associated is feeling the heat a little, weaker groups are feeling it more. A couple of weeks ago, Trinity Mirror, which owns the Mirror titles and a string of regional newspapers, reported a 10 per cent fall in advertising in the year to May, and warned of a fragile economic environment. Fellow regional publisher Johnson Press disclosed similar figures. ITV also recently warned of a sharp drop in advertising revenue. Almost everywhere the picture seems to be the same, with regional titles suffering worse than national ones.
The state of advertising is traditionally seen as a lead indicator of the economy. To judge by present advertising trends, Ed Balls's pessimistic forecasts may rest on surer foundations than Mr Osborne's optimism. Advertisers, particularly retailers, are trimming their budgets because they fear they are entering choppy waters, though last week's improved profit figures from Marks & Spencer bucked the trend. The upshot is that some publishers, who are already absorbing a sharp increase in newsprint prices this year, and are in any case experiencing continuing circulation decline, will come under renewed pressure.
Most titles have already cut their costs significantly. Some editors are likely to be told by managements to restart this process – indeed, there are rumours that there are going to be further economies at The Times. We can't know how long the advertising downturn will persist – let's pray that autumn brings a recovery – but if it goes on for long I fear some newspapers are in for a further battering.
How does Boris get away with it?
Last week I bumped into my old colleague Boris Johnson at a farewell dinner for The Daily Telegraph's great political cartoonist Nicholas Garland, who has inexplicably been let go by the paper, admittedly at the age of 75. Despite one or two perhaps rather harsh things I have written about him, Boris greeted me with me his natural good humour. He really is a most engaging fellow.
Still, he would not expect me to pull my punches. I continue to be amazed that, alone among leading politicians in power, he has a weekly column in a national newspaper. How does he get away with it? Sometimes he uses his Daily Telegraph platform to urge the Government into another course of action, for example by suggesting there should be tougher strike laws. At other times he reminds us what a huge success he has been as Mayor of London. There is a mayoral election next year, after all.
In a column last week about Ken Clarke's penal policy, Boris gave us a lengthy account of his own triumphs. According to him, crime is "well down" in London, with robbery on buses almost halved, and the murder rate at the lowest level in the capital since 1979. He boasted about the success of the Heron unit in Fulham under his watch "where 18 to 24-year-olds are given the help and education they need to avoid becoming repeat offenders".
Well done, Boris. I mean it. But why should only he be allowed to recite his political successes in a national newspaper? In a spirit of even-handedness the Telegraph should give Ken Livingstone, his challenger next year, a rival spot.
Don't ignore threat to press freedom
The Guardian is extremely exercised about the News of the World's phone hacking antics but it can't get at all worked up about "gagging orders". In a recent leader it judged Britain's libel laws a far more serious problem, and pointed out that very few super- injunctions are now being granted. The paper appears to think that gagging orders are necessary to curb the wilder excesses of the tabloids with their devotion to "kiss and tell" stories.
In fact, as The Independent brilliantly revealed last week, at least 333 privacy or gagging orders have been issued by judges over the past five years. This is a frighteningly large number. The majority of them were granted in the family courts, and are not about kiss and tell. Outside the family courts, several such orders concern allegations made against banks or companies, while others have to do with matters that apparently have nothing to do with the sexual shenanigans of footballers or actors.
One can understand that the high-minded Guardian should be appalled by some newspapers' interest in celebrities who betray their spouses. But it would be a pity if its hatred of the tabloids blinded it to the threat to a free Press represented by judges dishing out hundreds of secret gagging orders.
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