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Address to the South Australian Press Club 13 July 2012

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Address to the South Australian Press Club 13 July 2012 ADDRESS TO THE SOUTH AUSTRALIAN PRESS CLUB 13 JULY 2012 YOU CAN’T HOLD BACK THE TIDE Ladies and gentlemen, historians give differing accounts of the story that I’m about to tell; some say it never happened at all, some say it happened elsewhere, but even if it’s apocryphal, it is nevertheless a story for our times. In the year 1028 or thereabouts, Canute, King of Denmark, England, Norway and parts of Sweden set up his throne on the tidal flats of Thorney Island, site of the current day Westminster in London, pointed his royal sceptre to the tide and uttered those immortal words: “I command thee not to rise”. Stubbornly, the tide refused to obey, and Canute’s chair, feet and royal cloak got duly soaked. When we hear this story as children we think of it as a story of human arrogance and folly. Not even Kings have that much power; Canute must have been a right royal fool. But when we hear it as adults, we know that Canute, a canny king, was reproving his courtiers and teaching them a lesson. Wise leaders, he is saying, know their power is limited, so you shouldn’t ask them to try to do the impossible. Canute was smart. But let’s assume for a moment he was truly dumb. What if he had given stopping the tide a good go? It’s possible. The technology was widely available. He could have set up a tidal review. Built a wall. And put it under the control of a publicly funded tidal regulatory body. The problem is of course, that, tides being the way they are, the wall would have to have been extended around the entire perimeter of England, Scotland and Wales. And given the likelihood of storms and tidal surges, it would have to have been progressively strengthened, repaired, rebuilt and heightened until all of Britain disappeared behind a walled fortress. Protected from the tides but also isolated and bankrupted, Canute and his people would have been safe from those bothersome rising waters. The smart Canute is a man for our times. I’m betting he would have understood the problem we now have before us: the rising tide of the digital media. This is a subject that raises all sorts of Canute-like possibilities. Instead of commanding the tide not to rise, we could command television not to go online. We could command newspapers and publishing houses not to sell their products on iPads or iPhones, and record companies not to sell music via iTunes. We could even try to regulate what people can say, from Laurie Oakes down to those angry Fox Sports News bloggers who think there should be more South Australian cricketers playing for Australia and offer free abundant advice of original and charged 1 character! Then we could more easily hit such people with fines, or even put them in gaol. Some media companies have already tried to hold back these tides, and have ended up with wet feet, or, should I say, soggy paper. Their newspapers have shrunk. Their bookshops have closed. And their share prices have fallen. And now, it seems, there is a real danger governments want to give Canute’s approach a good go too, with new forms of regulation. And, you know, like our dumb Canute, with enough money, enough regulation and enough stupidity they could possibly do it – by building a new sort of digital regulatory wall. After all, North Korea built one, sort-of. And so did the Party in George Orwell’s dystopian novel, Nineteen Eighty-Four. Alternatively, of course, and far easier, we could all simply stop worrying about the tides. We could let them roll-in, roll-out, harness their energy to our advantage, and prepare calmly for the future. That’s my humble advice to media companies and media regulators in this, the year the iPad became the fastest selling consumer device in history. Instead of trying to hold back the digital tide through self-defeating regulations, why not try to rise along with it instead? It is far better to accept the digital media world as your friend, regulate it ever so lightly (and only where there is demonstrable need), let consumers make their choices, and leave unnecessary intervention to unhappier, less free and fictional nations. ADELAIDE – NEWS LIMITED’S ORIGINAL HOME TOWN This is my first opportunity to address the South Australian Press Club since becoming News Limited CEO. Indeed it is my first public speech to a media gathering. Like all media organisations, News Limited is changing at a rapid rate. We’re now part of an extraordinary global media and entertainment company in The News Corporation. But we never forget where we came from. And that of course is Adelaide, where we were born with grease on our overalls and ink on our palms. This is where Rupert Murdoch started his business when he took a half share in the Adelaide News in 1953. Much has changed since then. Our current South Australian mastheads – The Adelaide Advertiser, The Sunday Mail and the Messenger community newspapers – are read by millions every day and have a great future. They know their audiences like no one else does. And of course our printing presses here are some of the most sophisticated in Australia. And this is the only metropolitan market with flat wrap delivery of our printed newspapers. And Adelaide Now is one of our best digital products, very closely connected with this community in the best media traditions. 2 NEWS LTD – A NEW TRANSFORMATIVE GROWTH PHASE FOR THE DIGITAL ERA Just a few weeks ago, when the big changes at Fairfax and News Limited were being announced, and Gina Rinehart’s battle with the Fairfax board was getting underway, some journalists were describing it as the week that marked the beginning of the end of the newspaper. Some even said the newspaper as we know it could be dead in just five years. But let me remind you that just last week we at News Limited printed, sold and delivered around seventeen million newspapers across Australia between our metropolitan mastheads and regional titles which comprised 11.5M paid copies and the balance were from our community publications and mX. And the company sold many hundreds of thousands of magazines and books last month also. And that is before we go into the vast millions of weekly digital users who number over twelve million each and every week. And that is just us at News - hardly the portrait of a failing company! So it’s important to keep what’s happening in its proper perspective. There is time to get the future right. Governments must keep a calm head, and media companies don’t need to beat a panicky retreat but engage in thoughtful strategic business planning. There is time for all of us to get it right – although no time to be complacent. Nevertheless, the media world is changing. News Limited has announced a plan to put the customer front and centre of everything we do, to invest and innovate and to streamline our organisational structure so that it is fit for purpose for today’s world. I’m proud that News Limited’s approach wasn’t reactive but is instead about creating the next transformative growth phase in the life of our company. We are preparing for the future, deliberately and sensibly. And this involves many interconnected transformational steps that will allow us to strengthen the company financially and in that way increase and improve the standard of journalism and entertainment we offer Australians every day. So, for instance, from the point of view of the individual reader, we are bringing forward our new publishing platform Methode which will allow the very best of our journalism to reach all our print and digital publications seamlessly and simultaneously. In editorial we are moving quickly to a “one city, one newsroom” strategy across our daily, Sunday and community products. The single newsroom will transform our metro newsrooms. It will allow us to focus on producing the best local news. It will unlock the unrivalled knowledge and connections of our local reporters have with their communities. In parallel we are reinforcing our national network group. This group is dedicated to building the strength and expertise in content across common national and international editorial - to produce the best national journalism. These changes are good for journalism. They are good for customers. And with digital access needs of today’s customers, they are utterly necessary. They are actions about NOW. 3 We are boosting our online business assets, through the purchase of Australian Independent Business Media, which publishes Business Spectator and The Eureka Report. This acquisition, in combination with the superb business offerings of The Australian and the Wall Street Journal, mean we now offer Australians the most comprehensive business journalism and analysis. We are aiming to gain a 50 percent holding in FOXTEL and 100 percent of FOX Sports – which through long effort on our part and that of our partners, are profitable now and well placed to succeed even more strongly in the future. And of course, we are streamlining our back office operations to take full advantage of the economies, the creative and the sales-related synergies that digital technologies are making possible and necessary. I am pleased that the restructuring of News Corporation presently being pursued, which would separate its publishing and media and entertainment businesses into two distinct trading companies, has recognised all our Australian newspapers, their digital extensions, and our ownership stakes in various companies including FOXTEL, FOX Sports and realestate.com.au need to remain together in one corporate entity.
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