Wednesday, August 27, 2008

Blood letting at Fairfax begins: Age editor sacked

Andrew Jaspan, the editor of The Age, appears to be the first victim of the 550 job cuts announced by Fairfax yesterday. The company’s Victorian chief Don Churchill announced Jaspan’s departure to shocked staff of the Melbourne broadsheet this morning. In the staff memo, Churchill said Jaspan had “delivered great papers and has done a magnificent job in reinvigorating The Age”. However he said Fairfax had decided that for “this next critical stage of The Age we would have fresh editorial and executive leadership.” Jaspan’s departure follows that of The Age’s marketing manager Antony Catalano who Churchill also sacked yesterday.

While Jaspan didn’t endear himself to Age journalists over his decisions to allow commercial partnerships to compromise editorial independence, his departure is a concern as it does not appear to be made for journalistic or editorial reasons. Newspaper quality is certain to suffer as journalists follow Jaspan out the door. Fairfax CEO David Kirk hopes to save $50 million with the cuts and the redundancies amount to five percent of the company’s total staff. Crikey editor Jonathan Green believes the two departures confirm the impression that the future business plan for the newspaper is about controlling costs rather than going for growth.

The redundancies news was delivered by the company’s senior brass, CEO David Kirk and deputy CEO Brian McCarthy. Kirk and McCarthy painted the move as a “major restructure of corporate and group services” designed to improve productivity and performance. The job losses were spread across many areas of the business with three in ten redundancies affecting editorial staff in Australia and New Zealand. Fairfax will outsource production of the sections and special reports that are inserted into its papers. The two Sydney newspapers, the Morning Herald and The Sun-Herald, will be merged under a seven-day roster while Melbourne would suffer a “deferral of wage reviews for senior management, a review of our marketing spend, reduction of discretionary spending and a review of our distribution framework.”

Caroline Overington
at Murdoch’s The Australian quotes Sydney reporters who say Fairfax is abandoning quality journalism at its flagship newspapers. She said Sydney staff passed a motion after they heard the news saying they had "lost confidence in the Fairfax board and its ability to manage the company through these challenging financial times when its only strategy is to cut editorial staff again and again". Sydney Morning Herald journalist Gerard Noonan called management "gutless" and said they were using "the worst of the Work Choices legislation" to make deep cuts to journalism. "This is a panicked response," he said. "Management is clearly struggling to deal with how to handle the complex demands of high-end, quality journalism."

Another Murdoch media analyst, Mark Day, says the announcement has deputy CEO Brian McCarthy’s fingerprints “all over it”. McCarthy was the former head of John B. Fairfax’s Rural Press, which merged with Fairfax Media 15 months ago in a $9 billion deal. McCarthy’s model at Rural Press was based on small editorial and sales teams using centralised printing facilities to produce more than 100 mastheads. He was notorious for cost-cutting and hated by journalists who claimed reporting capacity was sacrificed for profits. But Day says the model won’t work for the city broadsheets. “The Sydney Morning Herald and The Age need to be agenda-setting and relevant to consumer interests to have an influential role in modern societies,” he said. “This cannot be achieved by filling the gap between the ads with the kind of cheap-as-chips copy-sharing and PR-supplied bumf that McCarthy’s regional weeklies have been able to get away with."

Chris Warren from the Journalists’ union MEAA (Media Entertainment & Arts Alliance) believes the sackings show the newspaper industry is in crisis. He was unimpressed by Kirk and McCarthy’s mantra that "media companies fit for the modern media world need to be lean and agile". Warren told the ABC PM program yesterday he had “absolutely no idea” what the company actually meant by that statement. “You can't produce this sort of quality product that are so essential in this day and age by cutting costs,” he said. Professor of Journalism Wendy Bacon agrees with Warren and she told the same program that quality impact was inevitable. “Now, I know of no research that's accurately measured this, but certainly anecdotally, already errors have been cropping up where you wouldn't have previously seen them,” she said.

These errors are sure to increase given that 120 journalists are among the jobs slashed. More worrying is the likelihood that the cuts will see further erosion in the commitment to quality journalism. While quality is a difficult characteristic to determine, journalism academics such as David Conley have used the measure of at least one journalist per one thousand circulation. The Fairfax broadsheets fall well short on this measure. And with salaries and expenses frozen and no new cadets to be taken on this year, it is unlikely we will be seeing too many investigative scoops or damning exposes of dubious doings of those in high office. A further “dumbing down” of news is the most likely outcome.

Only the markets were happy with Fairfax’s slash and burn exercise. The share price closed last night at $2.98 up 14c and a rise of five percent for the day. ABN Amro media analyst Fraser McLeish saw the cuts as positive because “they’re aligning the costs with the revenues, which is what you want to see.” While McLeish sympathised with those working for Fairfax, he said it was in line what was happening to the newspaper business elsewhere. “You just have to look overseas to what's happening there,” he said. “Five per cent of the workforce is a lot less than what some of the big US newspapers are announcing."

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