NUJ wades in to Guardian advertorial row

NUJ general secretary Jeremy Dear has warned that all paid-for editorial content in newspapers should be marked clearly following a row at The Guardian over a paid-for supplement.

His comments come after Guardian columnist Simon Jenkins condemned a supplement in last Wednesday’s Guardian sponsored by the Housing Market Renewal Partnership, a government agency.

The piece contained news articles and positive editorial comment on the government’ £5bn Pathfinder scheme launched in 2003 to regenerate cities in the North and the Midlands through building new houses and demolishing old ones through the use of private developers.

Dear said: “Things like this should be clearly labelled either as a promotion or advertorial. The journalists shouldn’t be expected to work on it but may volunteer to do so for extra payment.

“The problem if you don’t properly label it other editorial content’s integrity is called into question by people who cannot tell the difference between paidfor content and genuine editorial.”

Jenkins alleged that none of the supplement’s contributors knew it was paid for “in effect, by the Blair government”.

He said: “That taxpayers’ money is used to further the interests of private developers is bad enough. That such money should be spent inducing newspapers to dress public relations as journalism… is close to sleaze.”

Observer contributing editor Will Hutton wrote an article praising Pathfinders as a “solid attempt at organising a determined and coordinated at alleviating the worst physical decay, social isolation and economic marginalisation”.

The supplement carried a notice at the bottom on its first page which said it was produced by The Guardian “in association with the Housing Market Trinity’s investments, from page 1 If Trinity Mirror adopted the same investment strategy as News Corporation or the Daily Mail and General Trust, the editors of its national titles would be spending an extra £30m to £40m on their staff and titles every year.

In the last financial year, DMGT asked its Associated Newspapers subsidiary to deliver an operating margin of 10.3 per cent, while News Corp’s titles around the world delivered 12.6 per cent.

Meanwhile, Trinity Mirror squeezed 16.8 per cent from the Daily Mirror, The People and its other titles.

Significant costs savings contributed to this margin performance.

At the Murdoch margin, Trinity would have had an additional £28m to invest. Under the Rothermere regime, it would have been a massive £40m.

Trinity Mirror is run by rational, human beings. So why don’t they run their nationals in the Rothermere style?

For various reasons, including hefty family shareholdings, Rothermere and Murdoch enjoy more freedom than Sly Bailey.

But the brutal truth is that investors are wary of Trinity’s nationals because they occupy third place in the tabloid mass market.

In revenue terms, the Mail’s franchise is worth almost £1bn a year to DMGT. News Corp’s tabloids are probably worth as much, if not more – although the company’s financials don’t offer any detailed numbers.

And the Trinity tabloids? The Mirror, The People, the Daily Record and the Sunday Mail bring in just over £500m in revenue.

Running third in a three-horse race is an uncomfortable place to be. It was Jack Welch, the former boss of General Electric, who routinely culled business units that couldn’t do better.

Financial markets usually offer number one and number two players with strong management teams the freedom to invest for long-term expansion. But they are routinely sceptical about the ability of third- or fourth-placed players to overhaul the leaders – particularly in mature markets like the newspaper industry.

In addition, markets tend to be skittish about the risk of investing in weaker companies that are more vulnerable to economic shocks.

Accordingly, they look for signs of aggressive cost controls from management, something that Sly Bailey has certainly provided at Trinity Mirror.

They also look for a return that compensates them for the risks. Their motto is “jam today, not tomorrow”.

Trinity Mirror rewards the City for its patience by paying out handsome dividends. During 2005, Trinity Mirror paid out £60m to its investors.

That’s 29 per cent of the company’s pre-tax profits devoted to keeping investors happy.

By contrast, DMGT spent just 16 per cent of pre-tax profits on dividends to outside investors. At News Corp, the figure was 18 per cent The logic of financial markets can be viciously circular. In the case of Trinity Mirror, the market demands such chunky dividends because it doesn’t believe that the company will ever catch up with the market leaders.

But by extracting those dividends, the market also constrains Trinity’s ability to invest and expand.

– Peter Kirwan By Sarah Lagan The Voice publisher, the Gleaner, is outsourcing its UK subbing operation to Jamaica as part of a streamlining exercise.

Four production journalists will be made redundant, although the company is looking to redeploy them after their consultation process is over.

Acting managing director George Ruddock said: “It’s what you call a streamlining of the operations of the company. It makes sense to utilise the facilities we have at the head office.

“The final product will be printed in the UK. The technology today lends itself to the use of offsite facilities.

“What has happened is not unusual in the industry but is part of the modern way papers are being produced. It would obviously be a shame if we had to lose people.”

As well as The Voice, the Gleaner publishes the Weekly Gleaner, which is already produced in the Caribbean, and Young Voices in the UK.

In May 2004, The Voice was bought by the Gleaner, which produces its other North American and Canadian titles out of its head office in Jamaica.

The Voice outsources sub-editing to Jamaica Weekly lads’ mag Zoo has apologised and agreed to pay “substantial” damages to photographer and actress Koo Stark after printing an article last May which wrongly alleged she was a porn star.

The Emap-owned magazine printed an apology in the 16 February 2007 edition and agreed to pay Stark’s legal costs as well as the undisclosed damages.

Stark said in a statement that she is relieved that her name has been cleared of the “highly damaging” allegation.

She said: “I am delighted that the record has finally been set straight and my name cleared of an allegation that my family and I have found deeply distressing and hurtful.”

Emap refused to comment on the matter.

Zoo pays out over ‘porn star’ claims Paper insists supplement sponsored by government agency was clearly labelled MEDIA MONEY Renewal partnership”.

The Guardian, in a statement on behalf of the newspaper, said: “The Guardian, in common with most newspapers, publishes sponsored supplements which are labelled and designed as such. Wednesday’s supplement included on its front page a panel which stated that it was produced in association with Housing Market Renewal Partnerships.

“Simon Jenkins’s piece was a robust statement of his views, in the long tradition of The Guardian allowing its columnists a free rein.”

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