By Sarah Lagan
Free-newspaper entrepreneur Chris Bullivant has said the shock move by the Manchester Evening News to give away free copies is the only way forward for metropolitan evening newspapers.
Editor of the Guardian Media Group’s MEN, Paul Horrocks, has announced the radical plan to give away the 50,000 copies in the city centre, on top of its 130,000 paid-for sales, to combat falling newspaper circulation in the sector. He is also ditching the Lite version of the paper.
Bullivant, chairman of Observer Standard Newspapers, launched the first free city daily in Europe with the Birmingham Daily News in 1984.
He said: "I think going free is the only way forward for metropolitan evenings, but to be part-free and partpaid is just an attempt to save money.
I think they should bite the bullet and go free on three nights which would pay for the week on advertising, motoring, situations vacant etc, and the rest of the week paid for. Fifty thousand copies is neither here nor there. They will have to give them all away on the advertising days sooner or later."
Bullivant believes that advertising decline is structural, rather than cyclical.
"I’ve been publishing for 35 years and there is a trend," he said. "These papers are losing situations vacant to the internet, and that will continue. When you consider that sits vac comprise 30 to 35 per cent of revenues, if they lose half of that they’ve lost all of their profit. Those metropolitans were relying on it, whereas the average weekly newspaper does to a much lesser extent.
A well-produced newspaper delivered to the home with news is as attractive as the internet."
The Daily News was sold to the Birmingham Post and Mail and turned weekly.
The Evening Standard has a similar business model as the MEN as a large metropolitan paper with a Lite distribution.
Its managing director, Bert Hardy, said: "The move is certainly of interest. The Manchester Evening News knows its business very well, so it will be interesting to see what happens. We haven’t got the same thought in mind as yet, although it is one of the scenarios we have been looking at in the past.
"Over the years, evening newspapers have attempted to maintain their circulations by widening their distribution, but as you widen it, it becomes more and more expensive. You have the upside of maintaining a circulation, but the cost per copy goes up each issue, so it makes sense if you are going to have differential pricing to price the copy that costs you more at a higher rate than that copy that costs you less. I am not surprised that they are trying it and look forward to seeing how successful it is."
Johnston Press chief executive Tim Bowdler also said he was watching closely. He said the move did not necessarily signal that advertising decline was structural and long term. He said: "That would be the same as saying ‘look at that squad of soldiers, there’s only one in step’. The fact that one organisation has decided to try something different doesn’t mean that theirs is the prevailing view.
"It’s an interesting move and one that we will clearly watch with interest."
One media analyst believes the move to go free in the city centre will improve the financial performance of the business.
He said: "They are only selling 7,000 copies in the city centre, so what they are putting at risk in revenue terms seems very modest. It probably is financially positive. It seems such a marginal number and I can see it from that point of view, but it’s a way of undermining the perceived value of a newspaper; you are saying to yet another set of consumers that newspapers are something you don’t have to pay for."
Launch editor of the region-wide North West Enquirer and founder of the South Manchester Reporter, Bob Waterhouse, said although it is necessary for the big city papers to make such an extreme move to survive, he lamented the fact the paper has gone down the free route.
"It’s a shame when a great city and a resurgent city loses its paid-for evening newspaper; it’s a sign of the times," he said.
"The MEN is an institution. It was founded in 1868 and was brought as a money maker for the Guardian group, and it’s the Scott Trust that are doing this in the end. When I was first in Manchester, it sold more than 500,000 copies a day, and to push it, not into oblivion, but to make it free, has to be a sad day for publishing.
"It’s a question about how they feel they can keep pace with the changing classified market. It’s entirely a commercial decision and it’s not to do with their readers. In my view it’s about how they improve the bottom line. The MEN has always been the poor relation in terms of how the Scott Trust spends its money. It will spend a lot on The Guardian and The Observer, but the local papers are being milked to pay for it. That’s the way they run things."
Birmingham Mail editor Steve Dyson was cautious not to jump on any bandwagon, but acknowledged that change is essential. He said: "In the Midlands we haven’t even tried what they tried.
They’ve looked at Lite editions and overnight production. As a major centre in Britain we are exploring all such ideas, but the main response so far is that we are watching with interest.
I also think it’s important we don’t rush into things. We have to be careful not to play follow my leader if it’s not working.
Manchester seemed to be saying the Lite isn’t working well."
The National Federation of Retail Newsagents (NFRN) has endorsed the move, drawing attention to the fact that the MEN Lite had little effect on its members’ sales and that the MEN will help any newsagent that loses business.
NFRN meetings coordinator John Milburn said: "In the centre where the railway stations are, there is a lot of industry and so not a great proliferation of newsagents in that area that will be affected. Whether it will affect the wider area is the only worry. But for anybody on the periphery who might be affected and show a drop in sales, there will be a package to improve their business.
Some of the alternatives, such as home delivery, would have been worse."
■ The MEN NUJ chapel officially called for a ballot against plans by the company to introduce flexible working. According to MoC Judy Gordon, some journalists may have to work up to half their working year on night shifts. Talks are due to continue.