Desmond does at least understand the newspaper business

The Express group presented a different challenge. By 2000, the starry Beaverbrook years were long gone and the circulation was in steep decline – it was hard to see how the papers could be reinvented to capture new markets in what turned out to be the newspaper industry’s last fling. But with ruthless cost cutting, Desmond has wrung a profit from his shrinking assets. Rather than trying to build sales, he has simply accepted that his papers are on their way out and that, in the medium term, the road to profit lies in them surrendering to their fate. So no circulation stunts, no giveaways, no increased coverage of this or that: the Desmond recipe for success at the Express is to reinforce its ageing readers’ opinions, and give them occasional hope of increased mobility and pain relief with frequent front-page splashes that promise cures for arthritis. “Affirmation rather than information” is his motto. And affirmation comes cheap.

That’s a very sensible economic response. Sweat the assets of a dying industry for what they can be sweated for.

Note that I’m not talking about the content at all, his opinions, the editorial line or anything. Just the basic economics of it. There’s good profits to be had out of carefully managing a declining industry. Especially if you can buy in at a valuation that assumes you’re going to invest to expand it, or at least keep it going, and then you don’t do that.

Wonder how much one might be able to make by buying one of the venerable publishers and then stripping it right back to only the backlist, no new publications at all……you’d strip out nearly all of the costs overnight and have another few decades of that backlist as income.

14 thoughts on “Desmond does at least understand the newspaper business”

  1. I’m pretty sure there’s money to be made in buying The Guardian, firing all the Pollys and Monbiots, and getting somebody to write a piece of software that churns out boilerplate leftist twaddle which gets eaten with a knife and fork by the clowns employed in the public sector.

  2. So Much for Subtlety

    Tim Newman – “I’m pretty sure there’s money to be made in buying The Guardian, firing all the Pollys and Monbiots”

    I cannot believe that the Left is quite as brain dead as the Guardian suggests. So they ought to buy the Guardian, fire all the Pollys (although not Monbiot because with a tough editorial hand he can write some sensible stuff) and hire half the staff of some other Leftist rag – the FT for instance or perhaps the new Economist. Maybe even some of the writers for The New Scientist.

    Stupid as the new chaps usually are, they would be an improvement and I expect there is an audience for some leftist twaddle that is not such twaddle.

  3. Stupid as the new chaps usually are, they would be an improvement and I expect there is an audience for some leftist twaddle that is not such twaddle.

    Yes, and for that we have the FT and The Economist. 🙂

  4. So Much for Subtlety

    There’s good profits to be had out of carefully managing a declining industry.

    That is probably true but the other question is what is the alternative? You have an industry that still uses 19th century technology. What do you do with it? Britain had a lot of such industries. Coal. Textiles. Ceramics. A managed decline looks sensible. But if you don’t want to do that, what should you do? Taking money from Libya doesn’t seem to be such a sensible option these days.

    “Wonder how much one might be able to make by buying one of the venerable publishers and then stripping it right back to only the backlist, no new publications at all……you’d strip out nearly all of the costs overnight and have another few decades of that backlist as income.”

    Some academic publishers seem to be doing this on their own. Cambridge and Princeton University Presses are both re-printing old academic texts. The costs for which must be roughly zero. CUP is charging £20 or so as well. Criminal really.

  5. So Much for Subtlety

    Tim Newman – “Yes, and for that we have the FT and The Economist.”

    Except they are not really speaking to the same markets. Even though, weirdly, they are. These two audiences did not notice the Cold War is over and they are basically on the same side. The division of society into the Fiscally Prudent and the Fiscally Irresponsible is over. Society is now divided into the Metropolitan Elite which is socially liberal and statist, and everyone else especially those that are socially conservative.

    Guardian readers still don’t think of themselves as FT readers. Even though, in my experience, they are the wives and mothers of people who do. Tribal loyalty is too strong. But actually they are all one unhappy dysfunctional family.

    Meanwhile the Guardian has no shame at all. A shameless fraudulent Social Media whore libels a real scientist and the Guardian writes such a bad article – without doing a shred of actual reporting or checking – they have to edit it 30 times. And they simply refuse to tell their readers they did so. They cannot close soon enough.

  6. Books are still superior to tripe like Kindle –leaving aside the fact that the pukes at Amazon can tell what you are reading and how long you have spent on each page. Reduce the cost of physically producing books and the only problem is that retail–shops can’t keep stock equal to Amazo. What if your shop had its own mini-print works and could produce any one of millions of volumes in a few seconds?. There would be real books to browse and screens to look for books as you sip your coffee. That would not restore the bookshop completely but it would enable a lot more to survive.

    And of course with the endless costs imposed by the scum of the state removed–taxes, bureaucracy, council thieves, petrol-tax added cost of traveling, windwank boosting of already inflated energy prices caused by state mishandling, a population with massively sub-optimum prosperity caused by regulation, taxation, inflation, etc, ad nauseam–who knows what businesses could thrive. What we see today are only those businesses hardy enough to survive in hostile conditions.

  7. “I’m pretty sure there’s money to be made in buying The Guardian, firing all the Pollys and Monbiots, and getting somebody to write a piece of software that churns out boilerplate leftist twaddle which gets eaten with a knife and fork by the clowns employed in the public sector.”

    The Guardian is arguably just an organisation in “managed decline” with staff and the Scott Trust people getting as much as they can before the money runs out. Have you seen their offices? Madness.

    I forget which one it is… Salon or Slate, but one of those is going straight after the Guardian’s market. And I’ll bet they aren’t paying anyone Polly’s salary.

  8. Remember folks, this is the industry your sons and daughters are fighting to get into, willing to work for nothing just to get a foot in the door. Bizarre.

  9. Mr Ecks,

    “What if your shop had its own mini-print works and could produce any one of millions of volumes in a few seconds?”

    And your book would cost upwards of £50. That’s roughly what a single book costs to print via online services.

    Book printing is all about scale. You have massive printers in factories doing the same thing repeatedly. Set up Harry Potter and the Chamber of Secrets, kick it off, print a few thousand.

    It’s one way that Kindle benefits – if you’re after an older book that’s rarely printed, you avoid the higher costs of smaller print runs. Dorothy L Sayers’ books are about 2/3rds the price on Kindle than print.

  10. It’s how to run the pharma companies too: the Golden Age of medicine is long over. So they take each other over and sack lots of staff. Repeatedly. Pity, but there you are. Unlike climate scientists, they can’t just make it all up.

  11. Stigler: “And your book would cost upwards of £50. That’s roughly what a single book costs to print via online services.”

    Today –yes you are right. However, technology advances all the time. It would take some work but the text of millions of books could be stored as part of the machine and the book printed, bound and even given covers rapidly. Solving the old “We can order it for you” routine. It would be quicker than the net –for real not e-books. Amazo has to post real books. Yours could be printed in-shop while you drink a cuppa in comfort.

  12. And your book would cost upwards of £50. That’s roughly what a single book costs to print via online services.

    Really? lulu.com has been around for a while now, and as far as I can tell their print-on-demand prices are comparable to other dead tree books.

  13. I have to diagreee with Ecks over the Kindle damning viewpoint. I must admit I was skeptical over ebooks and reading from screens when they started, but the uncomparable advantage is that I can access any ebook in my library from any of my devices wherever I am – which I find very useful when boning up on technical references on the move.
    The lacking of lending or passing on is a disadvantage, but the ability to buy a book instantly and read it anywhere wins out for me.
    Also not having to devote space to storing and moving them.

  14. I doubt you would make any money by buying the backlist because the publishers know what it is worth. The comissioning/editing/rights selling of new books may take place in fancy offices in the West End, but once they are in production everything else happens out of a warehouse in the provinces.

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