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Shaping the Future of the Newspaper

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Thu - 02.10.2014


Hannah Vinter

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Paywalls are spreading, but that doesn’t mean that they’re popular: many readers feel put off when confronted with a subscribtion charge, as the title of a recent paidContent article “Does the LA Times paywall smack readers in the face?” suggests.

But as print declines, newspapers still need to make money online, so if they don’t go down the paywall route, what can they do? Google has suggested an alternative: microsurveys. Described by paidContent as a paywall “substitute”, Google Consumer Surveys ask users to answer a market research question before they are allowed to view certain types of content on a site. According to Mashable, Google charges businesses $0.10 for every response from a general US audience or $0.50 for every answer from a targeted demographic. $0.05 of that revenue then goes to the publisher.

On its blog, Google bills the surveys as "a model that benefits everyone”: publishers get extra revenue, and businesses get to know more about their potential customers. Last but not least, Google makes some more money. Google specifies that if users don’t want to answer a question, they should be given the option of performing an alternate action instead, such as handing over their email address to the publisher. This means that even if participating publishers don’t earn revenue through the surveys, they benefit from deeper engagement with their audience. According to Mashable, so far around 20 digital publishers are taking part.

In fact, although Google has announced the surveys as a “new way to access quality content online” on its blog, the idea is not entirely new. As Journalism.co.uk explained on its podcast about the initiative, the Texas Tribune has been using the Google surveys since August last year. The idea is older than that: as David Cohn, founder of Spot.Us explains, the community-funded reporting site introduced a very similar initiative in 2010, which allowed sponsors to pay Spot.Us for user engagement (answering a survey question, for example) and then earned the user “credits” to fund reporting.

The Journalism.co.uk’s podcast suggests that some of the publishers who have already adopted Google’s surveys are enthusiastic. April Hinkle, chief revenue officer at the Texas Tribune, tells Journalism.co.uk “we’ve been really, really pleased by the results”. According to Hinkle, “we’re earning on average about 5,000 dollars every 30 days from people just answering that one simple question.” This isn’t big money, but Hinkle describes the surveys as “another area of diversifying the revenue” of the Texas Tribune, rather than a way to finance the whole paper. And she notes that while the surveys are not the biggest source of cash, they aren’t the smallest either, and the money they bring in is consistent. What’s more, she suggests, there haven’t been any complaints about the survey acting as too much of a barrier to content: “it really hasn’t been a deterrent at all,” she states.

Adweek has also recently introduced the surveys, and Doug Ferguson, general manager of digital for the publication tells Journalism.co.uk that he has low expectations of the new model in terms of “betting the farm on it,” but that Adweek was keen to adopt the new scheme because “it seemed like a very low, low-risk test and an interesting business model.” Adweek experimented with a paywall before, he says, and did not make much money from it and while digital ad revenue has increased, there is still some way to go, so the survey is a possible attractive supplement to their income.

Ferguson emphasises that the survey model is flexible – publishers have the option to “lock” different types and different amounts of content behind survey articles, rather than taking a one-size-fits-all approach. In Adweek’s case, Ferguson states, users are only asked to answer a question on their second pageview, and will only be hit with the survey once within 24 hours, making the experiment as unobtrusive as possible. If the scheme is a success, he suggests, and doesn't bring down traffic to the site, Adweek might choose to dial it up later.

In fact, as the system is introduced, the questions only seem to affect users reading experience at a low level. Hinkle says the Texas Tribune only directs survey questions at users accessing the publication’s data pages and only those who come from outside the site. Neither Adweek nor Texas Tribune’s survey questions affect users outside the US. And Laura Hazard Owen at paidContent points out that the questions don’t work if users have an AdBlock app switched on.

At this stage, the surveys may be an interesting experiment to watch, but to find out whether they can become a significant revenue stream we have to wait for publishers to turn up the dials.

Sources: Journalism.co.uk (1) (2), paidContent (1) (2), Mashable, MediaShift, Spot.us

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Hannah Vinter's picture

Hannah Vinter

Date

2012-04-11 19:13

From East Coast business practices to Silicon Valley technology, European publishers have long looked to the US as a source of inspiration. But now, as media companies everywhere are seeking different ways to adapt to the new digital era, some European firms are coming up with smart solutions, which American news organisations could well learn from.

This is the argument made by media analyst Ken Doctor in a series of articles for Nieman Lab. Doctor, who is the author of Newsonomics: Twelve New Trends That Will Shape the News You Get, highlights examples of media companies that are thriving in Europe, including Schibsted in Norway, which has diversified into digital services and online classifieds, Gossweiler Media in Switzerland, which has created a successful community news model, and Sanoma in Finland, which has successfully persuaded print readers to pay more for digital access.

What else do American companies have to learn from Europe? And what more can European firms learn from the US? Doctor provides more detail in the following interview.

WAN-IFRA: In one of your recent articles you wrote that, while European publishers look to America, American publishers rarely look to Europe. Why is that the case?

DOCTOR: I think that 1) Americans tend to be myopic. We’re over here on the other side of the Atlantic, it’s a big country and oftentimes, not just in the news trade, people think more internally than they think externally. And 2) a lot of the early news innovation on the Internet did come out of the US. For both of those reasons I think, Americans have not looked that strongly at Europe.

WAN-IFRA: The successful European companies you focus on have done a good job of monetizing digital. Are there any US strategies for making money from digital content that you think Europe should learn from?

DOCTOR: One of the main ones would be on the sales side – the notion of local news companies being digital ad agencies. What a lot of companies are doing - Gannett and Hearst and Media News - is saying, we’re not just going to sell space on our own sites or in our newspapers, we’re going to offer you search engine marketing, we’re going to offer you mobile couponing, we’re going to offer you Facebook sites. And because we’re a trusted brand, we’ll be a trusted advisor in addition to being a publisher and an ad seller. There are a few publishers doing this in Europe, but for the most part they are behind the curve.

I think that I’ve seen less development in general in aggregation. The lesson of Huffington Post has also been exploited by a number of other American news companies. In general, the techniques of aggregation are underdeveloped in Europe. And I think those are very important cost questions because the cost of content is an important consideration going forward.

WAN-IFRA: You point out that Gossweiler Media forces advertisers to buy across different platforms and Sanoma’s Helsingin Sanomat makes it difficult for customers to buy only print. Should US media companies be equally pushy when it comes to getting customers to transfer to digital?

DOCTOR: You can only be pushy if you’re offering enough value. That’s the way of business, right? So in the case of Gossweiler, the fact that they are a must-read in local news and a must-have in terms of local commerce allows them to turn their system to an all-platform buy.

In the case of Sanoma, I think it’s similar to the New York Times in that there’s enough value in that newspaper [Helsingin Sanomat] that the customer is sold on the daily utility, or the weekly utility, of the newspaper. Once they’re sold on that continuing relationship, then to go to them and say “we know your habits are changing, we’re now making it easier for you to get this across platforms, just pay us another 10%”, isn’t hard to do. But the critical piece of it is that the unique selling proposition that a news medium has is fulfilled. That’s what’s really important.

WAN-IFRA: You’ve used Sanoma as an example of a company that’s been successful at charging extra for digital access, on top of a print subscription. Do you think this model could be transferred to the US?

DOCTOR: There are a number of large American dailies that are charging extra. There are really two models. There’s the New York Times model that says ‘one price, all access’ but then will price up over time. The other one, used by a number of dailies, is to say you’ve got to pay a little extra for digital access. I think that it can work. The product has got to be good enough so that when people are confronted by an additional price, they don’t say “no, I’m not paying that”. The non-print presentation has to be state of the art. If you have that relationship and you price smartly, maybe you go 5 – 10% up, and you do what Sanoma did which is to thoroughly integrate it in your marketing – which very few papers do either – if you do all those things, yes, it can be done.

WAN-IFRA: Is there a danger that some models that are successful on a small European scale could not be easily transferred to the US market – for example Piano Media, which has created national paywalls in Slovakia and Slovenia?

DOCTOR: I think there’s two ways that the Piano model could be applied. It could work on a regional basis, where people have a strong sense of state news or regional news being very important. It wouldn’t work on a national basis because there are clearly way too many national news players.

It could also work on a niche basis. Food sites for instance. If Epicurious got together with say a half-dozen top, gourmet recipe sites and charged one fee for it, that could well work. And you could take that metaphor to include certain kinds of sports, business, technology and health, if you had a critical mass of niche content in any area.

WAN-IFRA: With Gannett announcing it will erect paywalls on its 80 titles (except USA Today), it would appear "Paid Content 2.0", as you have referred to it, is in full swing in the US... Do you expect a similar trend in Europe soon?

DOCTOR: We’re already seeing that more than a tenth of US dailies are charging in one way or another for digital access. When I look at that strategically, it’s not a huge winning strategy in itself. What it does essentially is give you 5-10% extra circulation revenue, if you do it really well. And 5-10% plus circulation revenue is nice, it’s better than negative circulation revenue, but it’s not a huge amount of money. So it’s helping them a little in the short term, and that’s good, but the problem is that it’s mainly tapping their current readers, and current newspaper readers on both sides of the Atlantic are about 60 years old. Too many newspapers are trying to get more money out of the same audience, which is fine, but they’re not putting enough effort into getting new audience that they can monetize either through circulation or advertising.

WAN-IFRA: So how can news organizations court a new, younger audience?

DOCTOR: One of the most promising things right now is Facebook. The leaders here – the Wall Street Journal, the Washington Post, the Guardian and NPR – are saying, ‘we don’t care if new people come to our own site, or our own apps, we want them to come to our own content. And presumably our own advertising…’ They have essentially built out “site-lets” on Facebook and the Journal is monetizing that with advertising; Facebook at this point lets them keep 100% of that revenue. Facebook looks like the major way today to draw in new audiences who are not familiar with your brand, who can be definitely monetized with advertising and they may pay, if not for a subscription, then for a special product or special issues.

WAN-IFRA: You’ve written that media companies are becoming increasingly global, for example the Financial Times or the Wall Street Journal. Is this going to lead to further consolidation of media worldwide?

DOCTOR: I think yes, it will, but the timeline is really uncertain. One of the interesting combinations that’s come up recently is, if Rupert Murdoch is forced by investors to get out of the newspaper business, what about a combination of the Wall Street Journal and the FT, for instance? They’re serving a very similar market, and are both trying to be global business news players.

I think that we’re likely to see more roll-up within countries first. The nature of the technologies and cost reductions driving efficiencies mean that – as Digital First Media is doing – you can operate far more efficiently with greater centralization of technologies, finance and some national advertising on the web and really concentrate your unique resources, if they’re owned by one company, on content production and sales.

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Hannah Vinter

Date

2012-04-10 17:43

Okay. So you’re a billionaire businessman, you’ve bought all the villas and luxury sports cars you can get your hands on, and you’re still got piles of money left over. What are you going to buy? An art gallery? A sports team? How about a newspaper?

In an article for The New York Times last Saturday, David Carr suggests that it’s becoming increasingly common for billionaire impresarios to buy up newspapers, not for money, but for the status they offer. “Newspapers may be short on profits, but they have become a new form of ostentation,” writes Carr, “How rich is he? He can afford to own a newspaper, for crying out loud.”

As an example, Carr names Warren E. Buffett, who bought The Omaha World-Herald, despite famously telling shareholders in 2009 that the newspaper industry’s financial outlook was so dire, that he wouldn’t buy most papers “at any price.” Two other instances are are the developer Douglas F. Manchester, who bought The San Diego Union Tribune and hedge fund manager S. Donald Sussman, who bought part of the company that owns The Portland Press Herald.

Carr suggests that these rich men are attracted to newspapers not just as status symbols, but also because they know the papers might disappear altogether if they don’t receive financial help. But this comparatively harmless, motivation is sometimes combined with something more worrying; rich and powerful individuals have an interest in buying up papers to further their own agenda. Carr quotes media analyst Allan D Mutter: “As newspapers become less impressive businesses, people are going to buy them as trophies or bully pulpits or some other form of personal expression.”

Carr mentions a group of wealthy Philadelphia investors led by Democrat George E. Norcross III, and the parking lot businessman Lewis Katz, who recently bought up the Philadelphia Media Network. The New York Times pointed out in an earlier article that PNM “newspapers and Web site routinely cover Mr. Norcross and the rest of the potential owners,” leading to concerns that the buyers might influence the paper’s coverage.

 As the SFNblog reported last week, PNM’s new owners have signed a pledge, vowing that “the editorial function of the business shall at all times remain independent of the ownership and control of the company,” but the fact that the statement had to be signed suggests that worries about newsroom neutrality were running high. As previously reported, an earlier member of the Philadelphia investor group was Edward G. Rendell, the former mayor of Philadelphia and Pennsylvania governor, who bowed out of the bidding as a result of accusations that his political interests would interfere with the neutrality of PNM’s coverage.

Yet is it not preferable to have a newspaper saved at any cost, than to see it simply closed up? This is what Carr suggests, as he quotes David Nasaw, a professor of history at the CUNY Graduate Center: “People just have to be aware that other agendas exist, and the owners should be clear about that, but any time a big city newspaper is saved, I think we should stand up and salute.” Besides, Carr argues, it may be that the new owners "catch the journalism bug" and their papers will go on to produce good reporting.

The American Journalism Review has a different way of looking at the new generation of American newspaper buyers, which is simultaneously more upbeat that Carr and more gloomy. On the one hand, AJR suggests that the new buyers may have genuine interests in the newspapers as business propositions. Newspaper profit operating margins have fallen from over 20% 10 years ago to 10% at present, writes John Morton, the author of the article, but “a 10 percent operating profit margin, or even a couple of points lower, is not unattractive. Some industries don't hope to achieve 8 to 10 percent margins in the best of times.”

On the other hand, Morton suggests that the new “nontraditional” owners will take the slash-and-burn approach to newsrooms if profits decline too much more “in a misguided attempt to make their investments pay off.” In contrast to this dramatic asset stripping, Carr’s description of rich businessmen continuing to pour money into papers out of love or self-interest may be preferable.

Sources: The New York Times (1) (2), Sfnblog, American Journalism Review

Image by Benjamin Sperandio, via Flickr

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Hannah Vinter

Date

2012-04-10 16:45

Google has unveiled “Project Glass” - new augmented reality glasses, which allow users to interact with Google products and see extra information projected onto the world around them. Slate has a link to Google’s impressive video about the new product. 

Sky News has responded to Guardian reports that its News Managing Editor Simon Cole authorised a journalist to hack into the email account of a woman charged with helping her husband to fake his own death, reports Poynter. Sky maintains that its conduct was “editorially justified and in the public interest” and suggests that the Guardian is guilty of “double standards” for not acknowledging its public interest defence. The Guardian writes that “sensitivities at Sky News are running high” as its parent company BSkyB is investigated by the media regulator OfCom in the wake of the phone-hacking scandal at the News of the World.

WikiLeaks founder Julian Assange submitted evidence to the Leveson Inquiry into press standards today, in which he accused the PCC of failing to enforce “proper standards of fairness," reports Journalism.co.uk.

Digital guru Clay Shirky spoke to Guardian editor Alan Rusbridger about online censorship, data journalism and new kinds of reporting at the Guardian’s Open Weekend. The Guardian has published a full-length video of the interview.

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Hannah Vinter

Date

2012-04-05 18:20

A small spat has arisen involving the Newspaper Guild of New York, Reuters and TheBaron.info, an independent website aimed at Reuters’ past and present employees, which raises interesting questions about Reuters’ editorial direction.

On February 23, The Baron posted an article stating that Reuters’ editor-in-chief Stephen Adler, deputy-editor-in-chief Paul Ingrassia and COO Stuart Karle told staff in a meeting that “Reuters is adopting a new editorial approach aimed at winning Pulitzer Prizes: long, in-depth, investigative special reports from all bureaux.”

The Guild reported at the beginning of last month on The Baron’s original post, which reads, “asked about the business case for such a radical switch in journalistic priorities, the editorial chiefs said the chairman and majority owner David Thomson wants Pulitzers, and this is the only way Thomson Reuters can get them. He is a very rich man – the world’s 17th wealthiest billionaire according to the most recent Forbes magazine reckoning – and that is what he wants, chief correspondents were told.”

Yesterday the Guild wrote that Karle and Ingrassia had “both vigorously denied the report”, calling the idea behind it “stupid”. The Guild states that Karle had labelled the Baron’s original report as “factually incorrect and based on a flawed premise” and had termed the Guilds’ earlier reporting of it as a “cheap shot”. The Guild quotes Karle as saying “You do this stuff (quality journalism) because it’s a good in itself. It’s explicitly not a goal to win prizes.”

However, the Guild also reports that Barry May, an ex-Reuters journalist an editor who authored The Baron article stands by what he wrote, stating that he expressly verified the report before publishing it. May adds that in the three weeks after the report’s publication, no one from Reuters contacted him to say that it was false. What’s more, a later article by The Baron points out that Reuters deputy-editor-in-chief Paul Ingrassia wrote in a blog post a few days ago that, “online media companies (including my own…) have been investing serious cash in upgrading the quality of their reporting and have made no secret of gunning for their print counterparts when it comes to journalism awards, including the granddaddy of them all, the Pulitzer.”

Despite the sharp words from Reuters, the subject doesn’t actually seem to merit that much attention: it’s not exactly news to hear that a media organisation wants to win a Pulitzer. What is interesting about the issue, however, is the way it highlights editorial changes being made at Reuters. Lucia Moses published an article in AdWeek last Monday, highlighting the rise of Reuters and Bloomberg, in contrast to the decline of traditional print newspapers. In her headline, Moses describes the news agencies as “The Future of News: They're rich, they're global, and they're snapping up A-list journalists”. Moses points out that Reuters has not only hired an extra 600 journalists over the past four years, giving it a total newsroom staff of 3,000, it has also made a commitment to investigative journalism and has been hiring top journalists like Jack Shafer, formerly of Slate.

Although Reuters posted financial losses in February, Moses points out that, like Bloomberg, its news operations are supported by substantial revenue from financial data and services rather than shrinking ad money, and its costs are spread across multiple platforms.

These financial resources have given Reuters a platform to widen and deepen its coverage, and there’s little doubt that this is what it is trying to do. In a memo to staff, Steve Adler writes that, while Reuters remains absolutely committed to “fast, accurate, and fair” reporting”, these criteria, “are no longer sufficient in a changing company and a changing world”. Now, writes Adler, Reuters is focused also on providing “insight”, and this strategy will involve developing “Breakingviews, op-ed commentary, enterprise journalism, data mining, innovative video programming, stronger financial graphics, and other ventures that provide differentiated value”.

These changes manage may distance Reuters from the reputation that Moses says it has for creating stories written to make “a handful of people even richer”.

And if the shift is a success and helps Reuters along the way to a Pulitzer, it doesn’t seem like anything to squabble about…

Sources: TheBaron.info (1) (2), Newspaper Guild of New York (1) (2), Reuters (1) (2), AdWeek

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Hannah Vinter

Date

2012-04-05 17:01

For a long time, advertising revenue has been the life-blood of newspapers. But as media companies manage the switch from print to digital publishing, their advertising sales strategies have to evolve rapidly too.

How can you integrate print and digital sales teams? How can you still get the most out of print ads? How can you harness social media to boost your advertising? And how can you find new online revenue streams?

These were some of the questions addressed at WAN-IFRA’s 22nd World Newspaper Advertising Conference in Prague at the beginning of last month, where speakers included Will Goodhand, "Juicy Evangelist" at BrainJuicer in the UK, Peter Zollman, Founding Principal of AIM Group and Classified Intelligence and Halvard Kristiansen, Head of Behavioural Targeting for Schibsted in Sweden.

WAN-IFRA’s full summary of the conference is available now to download here.

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Hannah Vinter's picture

Hannah Vinter

Date

2012-04-05 12:38

German publisher Axel Springer’s subsidiary StepStone GmbH, is buying up TotalJobs, the UK’s second most popular jobs classified site, reports paidContent today. The sale, made on 31 March for a total of $110 million, marks the latest round in a “growth offensive in the area of digital classifieds” by Axel Springer.

In a press release about the sale, the Axel Springer explains that early last month it went into partnership with General Atlantic LLC in a move to expand more aggressively into the classifieds market. Axel Springer owns 70% of the new joint venture, which operates StepStone and the French and German real estate sites SeLoger and Immonet. TotalJobs, which employs 340 people and is described by Axel Springer as the “largest online recruitment business in the United Kingdom”, will add to StepStone’s portfolio of job sites across nine countries.  

The fact that Axel Springer is moving into the classifieds market stands out, because in recent years digital classified have represented more of a burden that a business opportunity to most publishers. Ashley Highfield, CEO of Johnston Press, is quoted in an earlier article by paidContent, observing that, “to say the wind was knocked out of the sails of the regional press when all the classified advertising went online is, to say the least, an understatement.”

However, a few well-positioned publishers have found remarkable success by diversifying into the online classifieds market. The most obvious example is the Norwegian publisher Schibsted, which invested almost 60 million in digital classifieds last year. Media analyst Ken Doctor examined Schibsted’s model in an in-depth article in Nieman Lab in February, and found that Schibsted’s online classified businesses, spread across 28 countries, contributes 21% of the company’s overall revenue. Doctor also highlights the “49-percent profit contribution of booming online classifieds business, even though it generates only about a quarter of revenue.”

Thanks to this investment in classifieds and other digital services, writes Doctor, Schibsted has significantly reduced its reliance on print advertising and circulation – something that most other publishers continue to struggle with. The model is obviously something that Axel Springer is trying to reproduce, and its growing portfolio suggests that it might be finding some success.

But there’s a potential problem for other companies that want to follow suit. Doctor states that when it comes to online classifieds; “one of the lessons Schibsted learned is that being less than the market leader isn’t worth much on the web. Dominance takes time to build, but it pays off. It leaves little room for others to compete,” he writes.

Big Axel Springer may find success as it makes its first foray into the UK – where, incidentally, Schibsed doesn’t list a presence – but UK publishers themselves haven’t had much luck in the same market so far. PaidContent writes that big UK publishing houses “have long since branched out from print small ads and now operate several specialist job websites like TotallyLegal and big-brand sites like Jobsite. But none of them rank the top five UK job sites for traffic, according to comScore.”

If Doctor’s right, online classifieds offer exciting new revenue streams for a few market leaders, but not everybody will find it easy to get a slice of the pie.

 Sources: paidContent (1) (2), Axel Springer, WAN-IFRA, Nieman Lab, Schibsted

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Hannah Vinter

Date

2012-04-04 18:53

The Wall Street Journal reports that Yahoo has announced it will be laying off around 2,000 employees – 14% of its total workforce. The Journal states that the decision has been “long-expected” as the digital company has been struggling with a lack of revenue growth and decreasing traffic to some of its sites. According to a source, further cuts are anticipated.

Foreign Policy magazine writes that, despite earlier commitments made by the US government to preserve “Internet freedom”, the US produces a high proportion of the tools used around the world to supress freedom of speech online.

Bambuser, a video broadcasting service, joins forces with the Associated Press to allow users to share citizen journalist videos directly with the wire service, according to thenextweb.com. Bambuser users have covered events in Egypt and Syria.

Journalism.co.uk reported that a group of UK students will soon launch a liveblogging platform called Ocqur. Users will be able to share tweets, videos, audio and photos in the posts.

The Verge carries an interview with The New York Times’ David Carr, who discusses the ethics of curation, WikiLeaks and The Guardian’s open journalism model, among other things.

For more industry news, please see WAN-IFRA's Executive News Service.

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Hannah Vinter

Date

2012-04-04 18:17

What should professionals in the printing business be doing right now? Last month’s WAN-IFRA Printing Summit in Berlin tackled this question and called on members of the industry to provide ideas about how publishers can harness technology and adopt new business strategies to help their print products survive and thrive, even in these testing times.

Speakers included Rainer Esser, CEO of Die Zeit, Gary Hughes, CEO of Canada’s of Transcontinental printing company, and Alexis Lozano Medina, director of Artes Gráficas del Atlántico.

A full summary of the Printing Summit 2012 is now available to download here

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Hannah Vinter's picture

Hannah Vinter

Date

2012-04-04 15:30

A little over a month ago, James Murdoch stepped down as chairman of News International. Now it has been announced that he is resigning as BSkyB chairman too. The Guardian writes that Nicholas Ferguson will replace James Murdoch as chairman of the UK satellite company as it continues to assessed by OfCom to determine whether it is a “fit and proper” broadcaster in the wake of the phone-hacking scandal at News International.

News International chief executive Tom Mockridge has been named as the new BSkyB deputy chairman. James Murdoch will continue as non-executive director of the company, said BSkyB in a statement, quoted in full by The Guardian. He will also continue in his role as deputy chief operating officer of News Corp.

In the statement, Murdoch explained that "as attention continues to be paid to past events at News International, I am determined that the interests of BSkyB should not be undermined by matters outside the scope of this company.

“I am aware that my role as chairman could become a lightning rod for BSkyB and I believe that my resignation will help to ensure that there is no false conflation with events at a separate organisation."

News Corp owns 39% of BSkyB and previously made a bid to buy the whole company, but withdrew its offer under pressure in the aftermath of the phone-hacking scandal last year, as Poynter explains.

James Murdoch presided over BSkyB and News International at the time of the scandal that led to the closure of the News of the World. The BBC writes that he has been “braced for serious criticism of his stewardship” from the upcoming report into the allegations of wrong doing by the Commons Culture Media and Sport select committee. Murdoch, who has twice appeared before the committee to give evidence, has denied that he had knowledge of phone hacking at the News of the World while it was taking place, or that he tried to cover it up.

The Guardian speculates that “by standing aside now, James Murdoch hopes to draw the sting from any criticism, but it remains the case that members of the committee will try to agree a verdict on his running of News International.”

According to the BBC’s business editor Robert Peston, it was Murdoch’s own decision to leave the UK satellite broadcaster. The Guardian writes that his decision to step down has “surprised friends, given that only a few weeks earlier he resolved to stay on a Sky even as he relocated to New York and gave up his job as executive chairman of News International, the publisher of the now closed News of the World, the Sun and the Times.”

Peter Kafka at All Things D writes that "News Corp. is making a show of publicly backing James Murdoch" as he stands down. Kafka quotes a joint statement given by News Corp CEO Rupert Murdoch and COO Chase Carey: “we are grateful for James Murdoch's successful leadership of BSkyB. He has played a major role in propelling the company into the market-leading position it enjoys today – and in the process has been instrumental in creating substantial value for News Corporation shareholders."

Sources: sfnblog, Guardian (1) (2), BBC (1) (2), Poynter, All Things D

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Hannah Vinter

Date

2012-04-03 18:37

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