The need for local newspapers has never been greater, but they must evolve

With news emerging that Johnston Press is set for administration after being unable to repay a crippling £220m debt, could we be about to see one of the biggest shake ups of the local and regional media since… well, since Johnston press itself began hoovering up vast proportions of the UK local and regional news market?

On Friday evening JP announced it is planning to file for administration. Shares in the business, once valued at £1.4 billion, are now worthless and the rescue operation is underway.

According to a message sent to all Johnston Press published by David King (and reproduced by holdthefrontpage), staff working for the newspaper group are set to lose their pensions and the entire group is up for sale. With potentially radical changes afoot, what does the future hold for its 154 paid titles and 37 free sheets?

In the interim all newspaper titles held by Johnston Press including the Yorkshire Post and Sheffield Star, will be transferred to a holding company, enabling the business to attempt to hang onto its prized assets whilst jettisoning its liabilities. So, it’s a stay of execution for now, but for how long?

History

Launched in 1767 as a printing business, Johnston Press first entered the newspaper market as far back as 1846 when it purchased the Falkirk Herald. During the 1970s the company made its first  foray into the acquisitions market with the purchase of Strachan and Livington in Fife, Chesterfield-based publishers of the Derbyshire Times, Wilfred Edmunds and the Wakefield-based Yorkshire Weekly Newspaper Group in 1985.

Following JP’s admission to the stockmarket in 1988, the company went on the acquisition hunt again and during the subsequent two decades it successfully snapping up large parts of the local and regional press. Locally, the company acquired Sheffield Newspapers, publishers of the Sheffield Star and Sheffield Telegraph and also  South Yorkshire Newspapers, publishers of the Doncaster Free Press.

Nationally, it made several major acquisitions including the Regional Independent Media group, the newspaper arm of Scottish Radio Holdings, Local World and Newsquest.

In 2006 JP purchased Scotsman Publications, publishers of Scotland on Sunday, The Scotsman and Edinburgh Evening News and as recently as 2016, the company purchased the i newspaper for £24m from publishers of The Independent.

From golden goose to poisoned chalice

Yet at the same time, the group continued to amass huge levels of debt, whilst failing to adapt to a changing marketplace. Debt for JP peaked in 2006 at £783 million, and with a £220 million bond due to be paid, the company can’t repay it. The problem facing JP is simply that its once prized assets no longer cover the value of its liabilities.

As newspaper circulations fell, the quality of its products was compromised, resulting in an ever vicious circle of diminishing returns. More adverts = fewer editorial pages = fewer pages = fewer journalists. Result? Unsurprisingly, circulation figures plummet.

The JP executives began scrutinising all areas of its business operations, attempting to cut costs and a few corners along the way. Some of the measures introduced made clear economic sense: after all, duplicating its back of office operations presented a chance to simplify its structure – however, they also took a big gamble, believing  it could reduce the number of journalists it employed whilst maintaining the quality of its products.

Ultimately it proved to be one gamble too far and, whilst changes in the way we digest the news may have to contributed, it’s prized newspapers were asset stripped – this is where the problems for JP really started.

Within its stable of products, the company held some of the UK’s most respected and trusted publications, run by highly respected journalists; newspapers which have proudly served their local communities for generations; Journalists who believed in the freedom of the media and the credibility of the story – impartial, objective and operating completely independently from the ad men.

Rather than equip these highly respected titles with the vital resources needed to operate effectively, journalism jobs were slashed, resulting in the vital editorial content being inevitably compromised.

That’s not to say journalists working at any Johnston Press title are doing a bad job, but it stands to reason that if there are fewer of them who are being asked to work across a greater numbers of titles, as well as trying to sell advertising space, the quality of each publication will inevitably suffer.

A simple way of thinking about this is to look at the nationals. The Sun and The Times are both owned by Rupert Murdoch’s News UK. But an article produced by the Sun would look massively out of place in The Times and vice-versa. So, should the same article which strikes a chord with readers of the Sheffield Star, simply be regurgitated verbatum in the Sheffield Telegraph, Mansfield Chad and Doncaster Free Press? – of course not.

Why did JP ever think that pooling journalism resources and sacrificing the all-important connection between local newspapers and the readers they serve would work?

After all, Barnsley Chronicle readers are interested in what happens in Barnsley, the Rotherham Advertiser readers are interested about what’s happening in Rotherham – both newspapers are equipped with a small but well-resourced team of journalists who are based within the respective towns and continue to represent, defend and scrutinise decisions made which impact upon the communities they serve.

In stark contrast, the JP owned Doncaster Free Press is largely run out of Sheffield, some 20 miles away, the Sheffield Star is increasingly reliant upon content shared content with its sister paper the Yorkshire Post, and you could just about walk into the newsagent of in any time where a JP title operates to read the same bland, non-descript features on Lifestyle, Motoring and Travel, etc.

Put simply, when the quality of a product is compromised, sales will suffer, regardless of which industry sector you are working in.

Should the signs JP was in trouble have been spotted sooner?

In South Yorkshire, the closure of the Rotherham and Barnsley editions of The Star heralded the beginning of a fundamental shift in the way in which Johnston Press newspapers served its local communities. The loss of approximately four editorial jobs (two in Rotherham and two in Barnsley) went by largely unnoticed, after all, both Barnsley & Rotherham benefit from their own independently owned newspapers which have always dominated sales.

Perhaps understandably, sales dropped when readers rightly started to question why their local daily newspaper was choosing to hail the virtues of its big city neighbour over their own community needs. Whilst steps have been taken in recent months to redress this balance (The Star for example has re-introduced a local democracy column covering news throughout South Yorkshire), the damage has been done.

At the same time, the cuts continued. The Yorkshire Post followed, closing its dedicated South Yorkshire desk and the Sheffield Telegraph’s small team of reporters were slowly removed from their posts.

Newspaper titles began disappearing too.

In 2013 we said farewell to the Green ’Un. When the South Yorkshire Times closed in 2016, it ended a 139 year association with Mexborough and the Dearne Valley. Free newspapers, a model which has worked well in some areas of the UK have lacked the necessary resources to be successful too; with the Dronfield Advertiser, Eckington Leader and the Sheffield Gazette all ceasing production in recent years.

Lessons to be learned from the demise of the South Yorkshire Times?

Launched in 1877 the South Yorkshire Times held a unique position within the region, filling a gap within the Dearne Valley to serve the communities laying outside of the centres of Barnsley, Doncaster and Rotherham.

For much of the time I’ve worked in South Yorkshire, the newspaper was editorless, directionless,  under-resourced and largely overlooked.  It appeared to me as if JP didn’t particularly care about the publication, or indeed the small but loyal readers who went out religiously every week to buy it.

Content for the newspaper relied largely upon recycled Doncaster Free Press editorial with an occasional Sheffield Star story thrown in for good measure. That was until it was provided its own resources under the short-lived reign of Jim Oldfield who was appointed editor of the South Yorkshire Times in 2009.

For a short period, and for the first time in a very long time, the Times looked to have turned the corner. Suddenly the people of Mexborough had re-gained a voice and the small circulation enjoyed by the newspaper began to show signs of improvement.

However, the new dawn proved to be short lived.

Just a year later, as part of Johnston’s cost cutting exercises, in 2010 the Times lost its Mexborough office, relocating staff to the neighbouring Doncaster Free Press – with editor’s post on the Times made redundant and pooled with three other local newspaper titles.

Perhaps unsurprisingly to arguably anyone but the JP executives, the circulation fell and the death knell was sounded when the Times produced its last print copy in 2016.

Were lessons learned? Not at all.

In 2017 the Doncaster Free Press itself became a victim of the Johnston Press cost cutting when it’s Sunny Bar offices were closed and remain staff  either relocated to Sheffield or reduced to home working. At the same time The Star and Sheffield Telegraph’s York Street offices were sold to developers who are currently in the process of turning them into yet more student flats, whilst the remaining journalists now work out of a serviced office in the city centre – spreading their thin resources across an ever larger number of media titles.

I’ve spoken to enough journalists during my career to know that most care deeply and passionately about serving their local communities. Whilst the model of using shared resources certainly helped JP to achieve its aims of satisfying the banks and its shareholders in the short term, it’s been clear for a very long time that its business model just doesn’t stack up and ultimately there would only be one tragic outcome.

Nationally, newspaper sales have been following a general downward trend, independently owned titles such as the Rotherham Advertiser and Barnsley Chronicle have generally fared much better than those in the JP stable. I think this speaks volumes about the importance of quality editorial content.  Simply because a reader is based in Sheffield, Leeds or Edinburgh, rather than Doncaster, Halifax or Falkirk doesn’t mean they should expect less from their local newspaper, they should expect more and this is arguably JP’s greatest failing.

What next for JP and its successors?

At the time of writing, JP has suggested no newspaper titles are planned for closure and they will continue to operate as normal; for now at least, but I suspect it will be inevitable that there will be some casualties in the coming weeks and months.

However, with all areas of the group up for sale, it is probable that further areas of the once great Johnston Empire will continue to be sold off – assuming of course that the price is right. Perhaps only time will tell.

Of course, Johnston Press is probably right, it’s business has been affected by the changing ways in which all digest news, but harnessed with crippling debts, and slow to embrace the new opportunities offered through the internet and social media, it’s perhaps unsurprising that the group finds itself in sorry state it is.

However, if the new holding company manages to keep the current media empire intact, it must invest in local news, rather than take from it. The need for local newspapers has never been greater, but they must evolve.

Will the successors to JP learn these lessons? Given that it’s going to be run by the same people who have driven large sectors of the local media into the ground, I’m doubtful. The pessimist in me thinks it will probably only be a matter of time before we see further titles disappear from the shelves. Within South Yorkshire,  I suspect that may mean the end of the road for the Sheffield Telegraph is looming, being replaced with weekly edition of The Star. I genuinely hope we’re a long way from that happening.

But unless the local and regional media can re-invent itself, it will.

And that’s not good news for anyone who cares about the local and regional media.

Matthew Ridsdale, Director, Cannon PR