Anyone expecting something radical or brave from Fairfax Media’s long-awaited strategy update today would have been under-whelmed. Instead of a strategy to deal with the dramatic changes occurring in media markets Brian McCarthy revealed a management restructure.

That’s not meant to be entirely pejorative, as there are elements of the changes that make sense and, indeed, were long overdue. But the update, which came after a strategic review of Fairfax conducted by consultants Bain & Co, failed to answer the big strategic questions confronting incumbent media groups as their traditional high-margin print businesses are being undermined by the rapid shift by consumers to low-yield online media.

The centrepiece of the update was the announcement of a new organisational structure which groups traditional core metropolitan print media products with their on-line counterparts and establishes national editorial and sales teams alongside the integrated mastheads. Fairfax’s other media businesses – its regional publications, its business media and radio network – will have similarly integrated multi-platform sales teams.

It was Fred Hilmer who took control of the online versions of the metro mastheads and their advertising away from the editors and managers of the physical papers to establish what was originally the F2 digital business and subsequently became Fairfax Digital, much to the chagrin of the leadership of the traditional products.

The tensions and rivalries that separation spawned – and the divergence in content between the newspapers and their online counterparts – created a competitive rather than co-operative relationship between the papers and Fairfax Digital.

The new structure better reflects the reality of the new media environment, where the distribution channels are regarded as simply platforms for content.

That creates a need for central decision-making about what goes where and at what time in order to maximise the readership and commercial value of the content, a need for co-ordination that has become even more compelling now that most of the major media groups are experimenting with paid apps for tablets alongside their newspapers, which have a cover price, and their online sites, which are free.

Fairfax’s decision to pursue a national strategy for both editorial and sales – it will have a new metro chief executive, metro national editor, metro commercial director and metro classifieds head – will offer some efficiency gains (McCarthy estimated them at about $10 million a year) but also creates some risks.

Newspaper audiences are intensely parochial and unless executed very intelligently and sensitively the decision, not just to bring the physical and online mastheads back together but manage them nationally, risks alienating the audiences. It might also provoke a response from an already anxious staff.

The question left largely unanswered by the update is how Fairfax plans to better monetise its digital presence. Other than emulating its peers by releasing paid apps (McCarthy said a new app for the metros which would have some unique content would be released early next year) and developing more video and transaction revenues Fairfax, along with the rest of the traditional media, is struggling to articulate a strategy for creating an economic presence online.

McCarthy cast doubt over Fairfax’s ability to charge for general news content – and therefore effectively downplayed the prospect of a simple pay wall around the Fairfax mastheads – while saying that it could be possible to charge for niche products with highly targeted audiences or products delivered onto mobile devices.

As has been the case for several generations of Fairfax management, there will also be a continuing reduction in the metros’ cost bases, which isn’t necessarily the best strategy for meeting the significant increase in demand for content and the differences in content required in a multi-media, multi-platform environment.

It’s not surprising that despite the length of the strategic review and the use of external consultants Fairfax hasn’t come up with some magic bullet that will ensure the survival of its key mastheads.

McCarthy, ruefully, said that ‘’we are all pioneers’’ when asked how the group would improve its online yields and that “our plan is to monetise wherever we can,” which is more an aspiration or hope than a strategy.

But then, as his reference to pioneers indicated, Fairfax is not alone in its sector in struggling to find a clear path to a sustainable future for its major mastheads.

*This article was originally published on Business Spectator.