Jun 20, 2012

News Ltd restructure: merged divisions, no cuts … yet

News Limited CEO Kim Williams has refused to say how many of the company's 8000 staff will be sacked in a homely video address to the nation this afternoon announcing his plans to slash the company's cost base.

Andrew Crook — Former <em>Crikey</em> Senior Journalist

Andrew Crook

Former Crikey Senior Journalist

News Limited CEO Kim Williams has refused to say how many of the company's 8000 staff will be sacked in a homely address to the nation this afternoon announcing his plans to slash the media giant's cost base. In the video announcement beamed to News employees across the country and taken live on 24-hour news channels, the freshman chief announced his long-awaited strategic rationalisation of Rupert Murdoch's local outpost -- cutting out its traditional federated structure and centralising editorial and sales arms. But the news everyone was waiting for -- the number of scalps Williams was plotting to remove from the business -- was not broached. Towards the end of the 13-minute address, the camera zoomed in on Williams' face as staffers waited on tenterhooks for a pointer to their journalistic future. But Gough Whitlam's son-in-law stayed mum. "I understand that change on this scale creates uncertainly, but please focus on the big and exciting things we hope to achieve," he said, adding the reforms were "best in class". "Regretfully a variety of positions will be made redundant, some of these will be through retrenchments, some of these through natural attrition," Williams said, bolstering his reputation as new media's velvet sledgehammer. The doomed headcount will become apparent "over time", Williams said, as the company transitions to a seven-day roster. "At all times people will be treated with respect and dignity." On Monday, rival Fairfax Media announced 1900 redundancies culled from the 10,000 staff stationed across its ailing business. Williams confirmed he would proceed with the $1.97 billion $3.50-a-share takeover bid for James Packer's Consolidated Media and the $30 million acquisition of Alan Kohler's Australian Independent Business Media. In a precursor announcement craftily leaked by senior News management to The Australian early this afternoon, the company said its 19 divisions will become five publishing houses in a "one city one newsroom" strategy. The new divisions -- spread over multiple physical sites -- will comprise News NSW, News Qld, News Victoria, The Australian and NewsLifeMedia. It is not known what will happen to News' Tasmanian operation, with one wag suggesting this morning that the Hobart office will effectively be run out of Southbank. In Victoria, Williams announced that Herald & Weekly Times Managing Director Peter Blunden had "generously" agreed to cast his editorial eye across the state, in an extension of his current strategic oversight role. All Victorian editors will now report to Blunden, where previously some answered directly to Holt Street. Williams was resolute on the need to embrace the digital age by decoupling content from the "channel" in which it is delivered to eyeballs: "We can no longer continue with a strategy that digital is something separate to the rest of the company." Journos would "create once and publish many times" though different channels "to create a viable and sustainable future". This presented an opportunity to build our business in "an amazing environment of change and opportunity". Williams revealed the new $60 million "Methode" editorial system will be brought forward by 2 years -- from the previously planned 3 years to 13 months, alongside a strengthening of the News intranet. Sales functions will also be further rationalised through the appointment of state-based sales tsars to be known as regional commercial directors. A product innovation team will also be created to scout for new revenue sources and delivery platforms. Williams said content from Business Spectator and associated websites would be integrated into The Australian's online offering and that News would ramp up its focus on "innovation", taking inspiration from the Wall Street Journal iPad app and the Herald Sun's hugely popular SuperCoach fantasy football site. The announcement caused a mini-frenzy inside the nation's online newsrooms, with former Crikey editor Misha Ketchell at one point popping up on Sky News to give his view on what it meant for journalism. Journos' union the Media, Entertainment & Arts Alliance cautiously welcomed the announcement but said staff would be concerned because "the extent of its planned redundancies during the restructure remained a mystery". “While the devil is still in the detail, and we are clearly concerned about the extent of redundancies being flagged by the company, we appreciate that News Limited is carefully considering its future and how it comes to grips with the ongoing transition to digital platforms,” said acting federal secretary of the Alliance Paul Murphy. Local community newspapers could be affected by the "one newsroom" strategy -- Crikey understands that rationalisation in some quarters has led to stressed editors having to file for multiple papers. “No media outlet should be lured into the trap of allowing digital platforms to continue to ratchet up the intensification of work done by already overstretched editorial teams,” the union said. Special internal spyware was installed last night on News Limited terminals for captivated staff to soak up their CEO's pronouncements. The video was accompanied by silence across the various state newsrooms the company's 3000 transfixed hacks tuned in. One senior journalist called the address "a fizzer" as this afternoon's broadcast petered out. Additional reporting: Matthew Knott The media release from News Limited Full audio of Kim Williams' announcement: [podcast][/podcast]

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11 thoughts on “News Ltd restructure: merged divisions, no cuts … yet

  1. Greg Romanes

    The Oz out on a limb by itself – I can see it becoming the new Bulletin. Who ended up owning the masthead of the Bulletin?

  2. linda domaschenz

    @Greg Romanes- the Oz is Ruperts love child his ear/eye and door to Canberra, and no doubt Gina wishes to replicate that with the SMH/Age ?
    The only profitable arm for Fairfax is FR and Rural Press.

    Goodbye Limited News/Fairfax……………

    Welcome Crikey, Global Mail and The Conversation and whoever is game enough to enter the market.

    I feel despondent for all the employees and our tactile press, but this weeks news has been a game changer- a turning point.
    I’ve long been a digital reader and happy to pay my dues here, but I will not ever pay a cent for the bias that Fairfax is about to become. I want informative and analytical news. It’s been on a downward spiral for yonks, I’ve remained loyal till recently- enough is enough.

    History in the making, but has been a slow and painful death for a long time.

  3. Ginas new vajazzle

    Williams should be able to redeploy some of his hacks into Gina’s new flagship – The Vejazzle – she will be looking for some with the right kind of attributes, and a spell in Rupert’s stable will look good on the CV.

  4. Michael de Angelos

    Why bother asking the Media, Entertainment & Arts Alliance for their view?. A useless union.

    While being interviewed by Mark Colvin on ABC radio Kim Williams scoffed at the suggestion “some people” perceived bias against Labor from News Ltd titles despite the numerous headlines declaring European heads of state had ‘slapped down ‘ Julia Gillard when no such thing had happened.

    One even claimed a direct attack upon the Canadian PM was really directed at Gillard.

    It will be interesting to see how many loyal mouthpieces of the right like Shanahan will be included in the reduced News Ltd.
    From past experience, News Ltd like Fairfax are no great experts at going digital. It’s doubtful the mass of readers who buy a newspaper despite it’s bias will transfer that loyalty to digital.

    There will be big winners in the future of publishing and those-like crikey-who are prepared to run an honest ship and steer down the middle will benefit greatly from readers who are prepared to pay.

  5. Liamj

    I don’t believe there will be any News Ltd cuts. Just the other day i saw a job ad at the newsagents, and my cabbies bro-in-law knows someone who still works for them. All this sackings talk is just a conspiracy by the journalists to get more perks. [/parody of News Ltd climate coverage]

  6. beachcomber

    Murdoch’s media empire is clearly run from New York. Announcing a “One City One Office” operation, when the city of Brisbane will be running regional newspapers scattered around the vast state of Queensland, means “regional news” will be minimal. Tasmania seems to fallen off the map completely, being run from a Melbourne or Sydney Office. The Murdoch Newspapers will essenially be bits of The Australian cut and pasted bewteen local ads, with maybe a page of local stories from a cadet journalist working from their home if we are lucky. With only the Fairfax/Reinhardt Mining Gazette as opposition, the end of newpapers has become one giant step closer.

  7. Ronson Dalby

    “The Conversation”

    What a great find that was for me last week, Linda.

  8. tenebrae

    Re. Bob Carr on Lateline last night.

    Was he actually serious simply being obsequious when he opined that newspapers (!!) were the best of Australian writing. What? The Oz? And Carr generally reads a lot.

    He then got bothered that he was being “pretentious”. How can a bourgeois philistine manage to be pretentious?

  9. Hugh (Charlie) McColl

    Tenebrae, doesn’t it make sense that an unpretentious “bourgeois philistine” would look in The Australian, The Age or the Manly Daily for their dose of good Australian writing?

  10. green-orange

    What about the Adelaide Advertiser ?

    Somewhat makes a mockery of the ridiculous claim by someone from Crikey the other night that The Advertiser makes more money than Fairfax (hasn’t turned a profit in years in fact).

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