Fairfax Media sees improved results, prepares to charge for online content

Posted by Savita Sauvin on August 27, 2010 at 3:55 PM

Australian publishing giant Fairfax Media showed much-improved financial performance for the year ending June 30, with annual net profits of AU$282 million after incurring a $380 million loss last year, caused due to declines in advertising revenues. Fairfax will also begin charging for content online and across emerging mobile platforms, to survive in the competitive newspaper industry, Agence France-Presse reported today.

Fairfax's online payment strategy will centre around a two-tier model, wherein users will be required to pay for accessing premium content, while generic content will continue to remain free, Sydney Morning Herald reported. The general news on websites of The Melbourne Age and Sydney Morning Herald will remain free, while "premium niche content" such as that on The Australian Financial Review's website will be charged.

The media group aims to pursue "greater sharing of editorial content and collaborating across print, online and mobile, more integrated selling and monetising our content online and on emerging platforms," Fairfax said in a statement to the Australian Stock Exchange, according to AFP.

The publishing giant has media interests in New Zealand and the United States, and plans to launch smart phone and tablet applications for a number of its products. It also moved all of its newspapers online, including 160 regional publications.

Fairfax's media strategy comprises of three broad elements: defending and growing newspapers, driving growth in Internet businesses and adapting to be a multi-platform company, NBR.co.nz reported. The group is also "investing in short-form video and have recently signed deals with both Ten and the ABC to expand the amount of video content on our sites."

Without revealing any specific details of the media group's long-term strategic initiatives, Fairfax Media chief Brian McCarthy said the company plans to harness the potentials of both online and print, while positioning itself to combat challenges in the industry space surrounded by a market of segmented audiences, circulation decline and online advertising push, according to the Sydney Morning Herald.

"Within the company, we will always have a two-tiered policy," McCarthy told reporters at the company's full-year results presentation on Friday, according to the Sydney Morning Herald. "I think the positioning of having a high-premium paid site and then a more universal free site, I think that strategy is the way to go."

The group's digital network saw growth by 18 percent since last year, with 30 million unique visitors per month. The online-only flagship business publication of the media group, the Australian Financial Review, witnessed strong revenue gains and the company's major competitor, News Corp., is expected to expand its service to Australia later this year, according to AFP.