So it’s not all about the advertising after all. Rupert Murdoch’s London freesheet The London Paper has passed away after three years despite market dominance and growing advertising revenue.
TLP’s revenue had grown every year since its launch on 4 August 2006: In the first 10 months of operation in the 07FY, the paper brought in $15.2 million which jumped to $28.8 million by the 09FY.
Even without the global financial crisis, the economics of the enterprise never added up. News Corporation is believed to have spent $46-$50 million a year to produce TLP. It employed 60 people (40 journalists) and printed 500,000 copies a day (25 per cent more cost than its competitor on 400,000 copies).
Consequently, it lost $33.8 million in its first year, $25.8 million in the second and is estimated to have lost $18.2 million last financial year when it was budgeted to lose only $10 million.
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Its closure on 18 September will stem the blood flow from NewsCorp coffers but not the red faces around the Murdoch family dinner table. TLP was the first paper started in Fleet Street by Rupert Murdoch (he bought The Sun and The Times) but it was closed by his son James Murdoch who now does his father’s bidding in Europe and Asia.
Loss of face can more easily be resolved around a boardroom table when the numbers are stacked up against you. What can’t be tolerated is inconsistency. After a recent road to Damascus conversion by Rupert Murdoch to charging for online content — he could hardly afford to throw it away in print on the streets of London.