The Weekend Australian Can Also Reveal That a Highly

Revealed: Fairfax job-loss road map THE AUSTRALIAN MAY 10, 2014 12:00AM Sharri Markson Media Editor Sydney Fairfax, like other traditional newspaper companies, is facing a fight for readers on new platforms. Picture: Dan Himbrechts Source: News Limited FAIRFAX Media consultants have drawn up plans to axe the print editions ofThe Australian Financial Review Weekend and The Sun- Herald as part of a range of aggressive cost-saving measures that also include replacing senior journalists who leave the company with low-cost third-year trainees. Despite repeated denials it has plans to close major newspapers, internal Fairfax Media strategy documents from mid-last year, sighted by The Weekend Australian,say the company will “explore all potential alternative print models” and will have a “watching brief dashboard on printed products”. The Weekend Australian can also reveal that a highly confidential report, prepared by global management consulting firm Bain & Company, recommends ruthless strategies to slash costs. These include hiring contributors to produce 20-50 per cent of all Fairfax editorial content and replacing 75 per cent of senior journalists who leave the company through attrition with third-year trainees. The revelation of the plans, considered in the past year by the Fairfax board, came at the end of a week in which The Sydney Morning Herald and The Age journalists participated in a 24-hour strike to protest against the redundancies of between 70 and 80 photographers, picture editors and production staff. Fairfax, like other traditional newspaper companies, is facing a fight for readers on new platforms such as smartphones and iPads while battling with high legacy cost structures in producing printed products. While News Corp Australia, publisher of The Weekend Australian, has said it is witnessing signs of revival in print as well as huge growth in digital subscribers, Fairfax’s chief Greg Hywood is continuing to champion a “digital-first” strategy at the expense of print. The Bain & Co report, commissioned by Fairfax to help guide this strategic plan, outlines ways to strip $20 million from newsrooms, including further integrating TheAFR with The SMH and The Age by merging the world, technology and sport sections and the Canberra bureau. It also recommends Fairfax exit its deal with wire agency Australian Associated Press to save as much as $7.2 million — a move that would threaten the viability of AAP. Many measures in the Bain & Co report have already been implemented, including this week’s move to outsource photography along with the decision to close the printed edition of BRW, closing the Melbourne Magazine and Sydney Magazines, and renegotiating the Pagemasters contract. Along with the recommendations to shut down The Sun Herald in Sydney and the AFR Weekend, Bain & Co also recommended reviews of The Sunday Canberra Times and sections of the SMH and The Age including Money, Drive, The Form and My Career. In the digital space, WA Today, Brisbane Times, Smart Investor and Money Manager were listed as low-- performing and under review. In the 2013 financial year, Australian Publishing Media, Fairfax’s publishing arm, had content creation costs of $237 million, with staff costs in the news division contributing almost 80 per cent and the contributor budget about 15 per cent. To reduce staff costs, the consultants recommend changing the “sourcing model” to use contributors instead of full-time journalists and replacing senior journalists over time with low-cost trainees and contributors. The report states there is a 25-30 per cent employee fluctuation a year through attrition and it suggests replacing 75 per cent of the employees who leave with “third-year trainees”. Another suggestion is for Fairfax to move to a low-cost contributor model, where Fairfax would source 20-50 per cent of its content from “lower-cost contributors.” It also suggests using topic experts, for example GPs, to “write at no cost”. In board meetings through the middle of last year, members and executives discussed closing major print mastheads to reduce costs. One document, titled the Strawman road map, included forecasts for 2014 and stated Fairfax would “explore all potential alternative print models” and “establish ‘watching brief dashboard on printed products.”. Fairfax Media chief executive Greg Hywood said not all of the Bains recommendations would be adopted and there were no plans to shut down The AFR Weekend or the Sun Herald. “Last year we publicly announced a comprehensive print product review and that everything was on the table,’’ he said. “Strong companies do this and should do this. Bains’ contribution to the review was to come up with a range of options, small to large, sensible to radical. Some were accepted, others rejected. We have absolutely no plans to change the print editions of the AFR Weekend, the Sun Herald or the Sunday Canberra Times.” .

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