Evening Standard: Analysis - crisis at the Mirror
By David Rowan
PIERS Morgan must be cursing the moment he first saw Helen Adams on Big Brother two summers ago. The famously inarticulate instant celebrity - the "halfwit from Wales", as Morgan put it - prompted an epiphany that led him to relaunch The Mirror as a "serious" newspaper that would pursue "comment and analysis" in place of showbiz trivia. This week, that miscalculation finally cost him more than 50 editorial staff, two magazines, and placed a question mark not only over his own position as editor but of the paper's future within the Trinity Mirror group.
In the brutally sharp words of Sly Bailey, the group's chief executive, "serious news" was being dropped in favour of "seriously good popular journalism". Bailey has been vigorously wielding the axe this week at the paper's Canary Wharf offices, and the scale of the job cuts - following 28 already lost recently - is prompting serious concern among commentators over the paper's editorial quality.
With Morgan's £20 million relaunch serving only to take circulation below two million, and a disastrous price war with The Sun causing the paper serious financial problems, Bailey has decided that the paper must focus on "fun" in order to survive. Gone are the education and medical correspondents, not to be replaced; gone, too, are the Saturday magazine, M, and The Look, a listings magazine.
As for Morgan's own future, when Bailey was asked last week if his job was safe, she replied: "I don't think I could say my job is safe. No one ever knows if their job is safe." The cuts are part of a wideranging plan to reduce the group's costs by £25 million within two years, and a total of 550 job losses have been announced across the company. But the scale of the editorial redundancies on the flagship national daily are leading City analysts to speculate that Bailey is merely trimming the paper so that it can be offloaded, along with its Sunday stablemate and the troubled Sunday People.
Bailey has denied that the papers are for sale - the value of the business "as a whole is undeniably more than the sum of the parts", she insisted last week - but the level of cost-cutting is prompting dark mutterings about the damage she is inflicting on editorial quality.
"Bailey may have a good background in regional journalism, but she just doesn't understand national journalism," says the paper's former assistant editor, Geoffrey Goodman, the leading advocate of traditional Mirror journalism. "This is a serious error of judgment, and I get the impression the accountants are now in charge. If they want to take on The Sun, let alone the Mail, they won't do it by cutting staff like this. They may find in a year's time they have to sell while sales are falling."
Nor is the City convinced about the cost-cutting strategy. Anthony de Larrinaga, a media analyst at SG Securities, says that Bailey is addressing the symptoms of the paper's long-term decline rather than seeking a cure. Readers will notice the editorial "loss of value", he says. "Cutting costs is not a long-term solution. The danger is that the new celebrity focus might not appeal as much to readers as to the focus groups. It's difficult to get away from the impression of falling revenue being chased by cost-cutting in the national papers, and the jury is out on whether it will work."
Analysts point out that The Mirror has been suffering a long-term decline in circulation revenue of around five per cent a year. The Sunday Mirror and Sunday People are doing even worse, falling by around 5.5 per cent each year over the past five years. With circulation accounting for more than half of a red top's revenue, the papers need to make their cash elsewhere - but with tabloid advertising revenue rising by just three per cent a year, all Trinity Mirror's national papers are in trouble.
It will be hard for readers not to notice such losses as M magazine, which has gone for obvious commercial reasons. For four years it has been costing the company around £9 million a year, according to insiders, yet failing to boost circulation sufficiently or to attract enough glossy advertising.
But the loss of key editorial specialisms may affect the paper's ability to get the exclusives that set it apart from rivals. The headcount is being cut from about 370 to about 320 - still 50 more than when Morgan took over seven years ago, but a more brutal cull than current staff can recall. Executives at the paper describe the cuts as a "sensible restructuring", and talk of job losses merely as "a streamlined headcount". Morgan did not resist them - he met with Bailey and Ellis Watson, the general manager, to agree the cuts as he understood them "to be for the long-term benefit of the paper".
THE company has told Morgan not to give interviews, but he is known to be furious at rival papers' suggestions of a "slash and burn" approach; he calls it a "trim and improve" strategy. Most of those affected, he has been saying, have come into his office to thank him for the generous redundancy terms. Certainly the mood among staff has been surprisingly upbeat: many had feared even more ruthless firings.
Besides, former executives point out that the paper has not always had a dedicated education correspondent. Bill Hagerty, a former deputy editor, says: "This is not a Richard Desmond-style purge, and the terms have been generous." Will the paper be put up for sale? Senior Mirror executives claim that they just do not know.
"Bailey genuinely believes that the company is worth more as a whole," says one. "I just don't know if her game plan is to fatten it up for a sale or simply to try to make more money out of it. It all depends on performance, I suppose." Morgan himself has been typically brash about his own future.
He is denying speculation that he is looking for an exit to television - his recommissioned Tabloid Tales series was just a bit of "fun" that took eight mornings' work in five months - and insisting that his editing job is safe "at least until the end of the week".
It is a typical Piers Morgan joke, of course. But Trinity Mirror's shareholders stopped laughing £20 million ago.
(Evening Standard, August 6 2003)
PIERS Morgan must be cursing the moment he first saw Helen Adams on Big Brother two summers ago. The famously inarticulate instant celebrity - the "halfwit from Wales", as Morgan put it - prompted an epiphany that led him to relaunch The Mirror as a "serious" newspaper that would pursue "comment and analysis" in place of showbiz trivia. This week, that miscalculation finally cost him more than 50 editorial staff, two magazines, and placed a question mark not only over his own position as editor but of the paper's future within the Trinity Mirror group.
In the brutally sharp words of Sly Bailey, the group's chief executive, "serious news" was being dropped in favour of "seriously good popular journalism". Bailey has been vigorously wielding the axe this week at the paper's Canary Wharf offices, and the scale of the job cuts - following 28 already lost recently - is prompting serious concern among commentators over the paper's editorial quality.
With Morgan's £20 million relaunch serving only to take circulation below two million, and a disastrous price war with The Sun causing the paper serious financial problems, Bailey has decided that the paper must focus on "fun" in order to survive. Gone are the education and medical correspondents, not to be replaced; gone, too, are the Saturday magazine, M, and The Look, a listings magazine.
As for Morgan's own future, when Bailey was asked last week if his job was safe, she replied: "I don't think I could say my job is safe. No one ever knows if their job is safe." The cuts are part of a wideranging plan to reduce the group's costs by £25 million within two years, and a total of 550 job losses have been announced across the company. But the scale of the editorial redundancies on the flagship national daily are leading City analysts to speculate that Bailey is merely trimming the paper so that it can be offloaded, along with its Sunday stablemate and the troubled Sunday People.
Bailey has denied that the papers are for sale - the value of the business "as a whole is undeniably more than the sum of the parts", she insisted last week - but the level of cost-cutting is prompting dark mutterings about the damage she is inflicting on editorial quality.
"Bailey may have a good background in regional journalism, but she just doesn't understand national journalism," says the paper's former assistant editor, Geoffrey Goodman, the leading advocate of traditional Mirror journalism. "This is a serious error of judgment, and I get the impression the accountants are now in charge. If they want to take on The Sun, let alone the Mail, they won't do it by cutting staff like this. They may find in a year's time they have to sell while sales are falling."
Nor is the City convinced about the cost-cutting strategy. Anthony de Larrinaga, a media analyst at SG Securities, says that Bailey is addressing the symptoms of the paper's long-term decline rather than seeking a cure. Readers will notice the editorial "loss of value", he says. "Cutting costs is not a long-term solution. The danger is that the new celebrity focus might not appeal as much to readers as to the focus groups. It's difficult to get away from the impression of falling revenue being chased by cost-cutting in the national papers, and the jury is out on whether it will work."
Analysts point out that The Mirror has been suffering a long-term decline in circulation revenue of around five per cent a year. The Sunday Mirror and Sunday People are doing even worse, falling by around 5.5 per cent each year over the past five years. With circulation accounting for more than half of a red top's revenue, the papers need to make their cash elsewhere - but with tabloid advertising revenue rising by just three per cent a year, all Trinity Mirror's national papers are in trouble.
It will be hard for readers not to notice such losses as M magazine, which has gone for obvious commercial reasons. For four years it has been costing the company around £9 million a year, according to insiders, yet failing to boost circulation sufficiently or to attract enough glossy advertising.
But the loss of key editorial specialisms may affect the paper's ability to get the exclusives that set it apart from rivals. The headcount is being cut from about 370 to about 320 - still 50 more than when Morgan took over seven years ago, but a more brutal cull than current staff can recall. Executives at the paper describe the cuts as a "sensible restructuring", and talk of job losses merely as "a streamlined headcount". Morgan did not resist them - he met with Bailey and Ellis Watson, the general manager, to agree the cuts as he understood them "to be for the long-term benefit of the paper".
THE company has told Morgan not to give interviews, but he is known to be furious at rival papers' suggestions of a "slash and burn" approach; he calls it a "trim and improve" strategy. Most of those affected, he has been saying, have come into his office to thank him for the generous redundancy terms. Certainly the mood among staff has been surprisingly upbeat: many had feared even more ruthless firings.
Besides, former executives point out that the paper has not always had a dedicated education correspondent. Bill Hagerty, a former deputy editor, says: "This is not a Richard Desmond-style purge, and the terms have been generous." Will the paper be put up for sale? Senior Mirror executives claim that they just do not know.
"Bailey genuinely believes that the company is worth more as a whole," says one. "I just don't know if her game plan is to fatten it up for a sale or simply to try to make more money out of it. It all depends on performance, I suppose." Morgan himself has been typically brash about his own future.
He is denying speculation that he is looking for an exit to television - his recommissioned Tabloid Tales series was just a bit of "fun" that took eight mornings' work in five months - and insisting that his editing job is safe "at least until the end of the week".
It is a typical Piers Morgan joke, of course. But Trinity Mirror's shareholders stopped laughing £20 million ago.
(Evening Standard, August 6 2003)
posted by David Rowan at Wednesday, August 06, 2003
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