MEDIA & MARKETING:The industry is having to adapt to ever-shrinking property advert revenue, writes SIOBHAN O'CONNELL
WILL THERE be the same number of national newspapers in Ireland at the end of 2011 as there are now? Possibly not. Newspaper publishers are being pinched by declining advertising revenues and falling circulations and, sooner or later, some title is going to fold.
Property advertising was next to nothing in 2010 and there’s no indication of improvement in 2011. The same goes for recruitment advertising, while ongoing migration of classified advertising to the web is creating further pressure.
According to National Newspapers of Ireland, advertising revenues fell by 8 per cent between January and September 2010. That is a €12 million drop on the same period in 2009. There were signs of stabilisation in autumn but consultant Accenture is forecasting the total advertising market will decline by 5 per cent in 2011 with press advertising predicted to fall by 8 per cent.
On the circulation side, sales of Sunday newspapers fell 5 per cent and daily newspapers also fell 5 per cent in the first half of 2010.
Despite newspaper profits coming under serious pressure, so far there has been no rationalisation of national titles. It is a different story with regional press, though. In June, the River Media group closed three of its titles, the Meath Post, Cavan Postand Sligo Post.
In September, the Roscommon Champion, Longford Newsand Athlone Voicewere closed by Alpha Newspaper Group. In December, Thomas Crosbie Holdings sold the Sligo Weekenderfor what is reported to have been a nominal price.
In the first half of 2010, the titles published by Independent News and Media across the island of Ireland delivered an operating profit of €27 million on turnover of €204 million. Though advertising income decreased by 13 per cent year on year, operating profit increased thanks to cost-cutting and cover prices.
The title under most pressure in the Independent stable is the Sunday Tribune. Tribune Newspapers plc reported an operating loss of €3 million and a net loss of €8 million in 2009. Another Sunday title in the spotlight in 2011 may be the Sunday Business Post, owned by Thomas Crosbie Holdings. The Post's circulation fell 14 per cent in the first half of 2010 and its advertising has been hit hard by the property slump.
Thomas Crosbie Holdings recently announced a €38 million loss for 2009, largely due to a €30 million writedown on the value of its print and radio brands. The group’s operating loss in 2009 was €3 million with the same level of loss predicted for 2010. Chairman Alan Crosbie said: “Media, which is an early indicator of the overall health of the economy, has to restructure its cost base to the levels of business available to it and prepare its products and people for the upturn that is around the corner.”
News International, which publishes the Sunday Times, Sunand News of the World,shows no signs of pulling in its horns, with the Sunday red-top investing heavily in columnists Bertie Ahern and Paul Williams. The Sunday Timeshowever had to cull some staff in the autumn.
The Irish Timesmade an operating loss of €4.6 million in 2009 compared with an operating profit of €6.4 million in 2008. While circulation revenues fell marginally, advertising income plummeted 42 per cent. In filed accounts, managing director Liam Kavanagh said he was confident the newspaper would break even in cash terms for 2010. Looking to 2011, Kavanagh said the difficult economic backdrop meant the company would have to re-evaluate its cost base and seek to exploit opportunities in digital media.
Associated Newspapers, publishers of the Daily Mailand Mail on Sunday, racked up massive losses to establish both titles in the Irish market. However, the titles are now profitable, with the latest filed accounts, for the year to October 2009, recording an operating profit of €1.6 million on turnover of €19.4 million.
