Newspapers around the country are restructuring–so how much money are they saving from these moves? Trinity Mirror (LSE: TNI) says it has shaved 30 percent from the editorial and advertising costs in its Midlands division as part of a plan by IBM to reduce headcount and integrate digital and print operations. A little-noticed release quietly published on IBM’s website last week says Trinity “viewed short-term cost-cutting as a necessary but not sufficient response to an industry experiencing permanent change.” This is part of an ongoing restructuring programme at Trinity that has seen at least 1,200 staff laid off this year, £7.5 million invested in a new newsroom in Birmingham, and the re-launch of the Birmingham Post.
IBM’s release describes Trinity as being like all other major regional publishers: fragmented. Each title had its own editorial and advertising and productions teams and “operations evolved little in many of the traditional ways of gathering news, editing pages, managing production and selling advertising”. So staff from the Birmingham Post, Birmingham Mail and Sunday Mercury were all working separately on these things while sitting in the same office. Georgina Harvey, Trinity Mirror Regionals MD, says: “We recognise that we are in a multi-media age and have to transform radically the way we do things.” Trinity is hoping to roll out the same model at its five other regional divisions.
Is this really so radical? All the main regional newspaper companies, including Johnston Press, Northcliffe Media and Newsquest, are re-aligning their commercial and editorial staffs, making massive headcount reductions and abandoning 20-year-old publishing techniques. But this is the first time we’ve seen a concrete example of exactly how much a newspaper company can save with this approach. One question, though, is how much of a difference it will make to the bottom line. Digital income at the company — which owns 150 regional newspapers and 200 web sites — is already slowing: the company’s digital revenues increased 15.5 percent in the 17 weeks to October, compared with 40.2 percent in H108.
– Multimedia advertising: One thing all regional newspapers need at the moment, IBM promise an “improved ability to create multi-media content and offer multi-media advertising” that will reduce advertising staff by 30 percent. There will also be an undefined “platform for future revenue growth” through “enhanced business and technical capability”. Ad customers will be served “via the most appropriate mix of field sales, telesales and web self-service”, so customers now have a 24-hour facility to place their own adverts into Trinity’s system to reduce reliance on expensive telesales and field sales staff.
– Remaking the newsroom: After a series of workshops with journalists in Birmingham, Trinity and IBM devised a system whereby reporters would write directly onto templated pages — reducing the need for subeditors — and a remote CMS from Mediaspectrum lets reporters file online from anywhere.