Talk about diminishing returns.

Newpaper circulation figures will be released on Friday, but rise or fall, there seems little chance that the Fairfax papers will reap any substantial financial benefit.

The publisher’s half yearly results released earlier this week recorded subscription revenue for the half financial year at $108.3m as against revenue for the matching period in 2006 of $108.0.

A gain of 0.3%, while obviously small, is also imperfectly formed. The true story emerges when you also consider that the major Fairfax titles have enjoyed recent cover price increases, that circulations are slowly on the rise across most days, and that the same half year results record an increase “subscriptions” over more than 20% in the first half.

And there’s the answer to the diminishing margin: Fairfax keeps offering massive discounts of up to 40% below newsstand prices to its increasing band of pennywise subscribers.

Contrast with Melbourne’s Herald Sun, the nation’s largest selling daily title, which gives a meagre 10% cent discount to a seven-day subscriber.

Proof then that whatever you might think about the current fortunes of Fairfax journalism, you can give it away.


Nigel Henham, The Age‘s communications director, writes: This must surely be a world first: Jonathan Green taking an interest in the business machinations of Fairfax and its subscription strategy! The Age has been extremely successful in driving record subscriptions and growing its circulation and readership. Converting casual buyers to subscribers provides a range of benefits, not least certainty of supply, ongoing contact with a very large loyal reader base providing a range of value-added benefits, and reduced wastage. We would urge all Crikey readers to take advantage of The Age‘s subscription package – as it seems Crikey does for its own readers. What an irony. We note that on your website you offer 39% discounts to students, seniors and concession card holders. One “group” offer for 50 subscriptions or more is priced at $35! Crikey fails to comprehend that the majority of any cover price increase is absorbed in newsagent commissions plus GST. However, if you follow Jonathan’s logic, the Herald Sun must be more expensive than The Age. Not so. The Age, at $2.20 on Saturday minus Jonathan’s “40%” discount for a subscription, equals $1.32. The Herald Sun on Saturday ($1.40) minus Jonathan’s alleged “10%” discount for a subscription equals $1.26. Both papers, which cost less than a cup of coffee, represent great value. In comparison, Crikey at around 30 cents a day (even with significant discounting) for what it produces looks decidedly more and more expensive.