‘Foreign invaders’ threaten struggling Australian media
SYDNEY: Australia’s role as a testing ground for global media giants such as the New York Times, Daily Mail and the Guardian could hasten the decline of embattled local players as they fight for eyeballs and advertising dollars, analysts warn.
With traditional sources of circulation and advertising revenues drying up, the world’s biggest news brands are spreading their wings to grow digital audiences.
One of the first places they have set up, producing local content for the domestic market, is Australia – already home to some of their largest foreign audiences, and with a ready population of early technology adopters and keen news consumers.
But with the market near-saturated, analysts say the foreign outlets, with their deep pockets and mostly fre e content, are eating into struggling local media’s revenues.
This has helped accelerate job cuts and belt-tightening at some of the country’s main publishers – Fairfax ( Sydney Morning Herald, The Age) and News Corp Australia ( The Australian, Sydney Daily Telegraph).
The foreign publishers “don’t require a subscription, don’t have a paywall and the problem is that’s weakening and disrupting all the existing players”, media analyst Steve Allen of Fusion Strategy told AFP, dubbing them “foreign invaders”.
“So it’s a nasty convergence of new entrants taking eyeballs away from the traditional mastheads and eroding their revenue base.”
Advertising revenues are already under siege from Google and Facebook, with Morgan Stanley estimating last year they would suck up 35 to 40 per cent of the total pool of A$ 13.9 billion ( US$ 10.3 billion) in Australia.
“The size of the (ad spend) cake is staying the same and growing by inflation at best. So for a new entrant to come in and take money, they take it off an existing player,” media analyst Peter Cox told AFP.
“So that’s what Google and Facebook have done...therefore there’s not much cake left for firstly the newspapers, but now increasingly television stations as well.”
Local providers can no longer count on the “rivers of gold” print classifieds to boost income, with digital advertising not yet able to bridge the gap.
Fairfax, a takeover target of US private equity giant TPG Capital and investment firm Hellman & Friedman, said last month it was axing a quarter of its newsroom to save A$ 30 million annually in the latest round of redundancies.
News has also announced severe cost- cutting, while the country’s third-ranked commercial broadcaster the Ten Network is on the ropes after posting dire half-year losses, citing poor advertising spend.
A battle is also taking place to win readers.
Fairfax, News and ABC are the most-read news websites in Australia, but Britain’s Daily Mail, Guardian and the BBC – which all have bureaus in Sydney – are making inroads.
The British titans were the fifth, sixth and seventh-most read according to March data from audience measuring service Nielsen. — AFP