First proposed at Ifra 2003 the COLORMAN XXL has had a remarkably short gestation period, just 18 months from concept to production press, and it may prove to be a very successful press for both its users and MAN Roland. The press at A Beig is the first, and smallest of four orders that Roland has already received, totaling an impressive 1100 printing couples. Foremost among these is the order for 22 presses from Rupert Murdoch’s News International UK and Ireland, which has not only boosted the German press manufacturer, but has galvanised the worldwide newspaper printing community. The fact that Rupert Murdoch has decided to invest almost Euro1bn in newspaper printing presses has given the unmistakable signal to all in the industry that it has a bright future, for that money would certainly have gone elsewhere if it were not so.
The press at A Beig has just two printing towers, two reel splicers and one folder, with three formers. Maximum web width is 1890mm, and it prints in the Berliner format. Beig uses it to produce a daily newspaper with five regional editions. It also prints for other newspaper publishers and for retailers. Total weekly output is in excess of one million copies.
Nanette Wolf, the 30-something managing director of A Beig says the press was chosen to enable the company to produce high quality products, rapidly, and with flexibility to meet its current and future customer needs.
At the Pinneberg launch event several leading luminaries gave their thoughts on the state of the newspaper industry in a series of presentations, led by MAN Roland CEO, Gerd Finkbeiner. Having developed a reputation for passionate honest public appraisals of the printing industry in the years since he took on the top job at Roland, Finkbeiner did not disappoint the assembled newspaper people.
He began by stating that the past three years since the terrorist events of September 11 had been very difficult for the global newspaper industry, with many countries experiencing double digit drops in advertising revenue every year since then. He then said that although the global economy looked like it was beginning to turn the corner the industry could not go back to the way it was before that catastrophic day. With the global economy set to grow at five per cent this year he said the story varied from area to area, and while display advertising was recovering, classified were a difficult area for newspapers, with the internet encroaching onto this market.
Finkbeiner believes that structural change is necessary for the newspaper industry to regain the growth it showed in the latter years of the 20th century, he thinks the industry cannot tamper with the edges but needs to engage in changing the way it operates. As an example of this he pointed to the major changes going on in UK newspaper publishing, with first the Independent, then the Times, relaunching in Compact format, and he says we will all see and need to engineer more significant change and become customer related. Although speaking at the launch of a new Roland press, Finkbeiner said he was not there to talk about the technology, that was a given, but look at how that can contribute to reducing the costs of newspaper production. And Finkbeiner isn’t talking about shaving two or three per cent of those costs, but chopping 15 or 20 per cent off.
His big three areas for consideration are the cost cutting, new applications and ensuring the highest quality. For the latter he is looking for consistent quality across the print run, and site to site, so that customers are satisfied with what they see whichever version of their newspaper they pick up. According to Finkbeiner this all means that managing change is the key, and will determine the success of failure of newspapers over the coming years. From his own company’s perspective Finkbeiner highlighted the differing formats the COLORMAN XXL is available in, six altogether. He also drew attention to the News International order saying a Euro1bn investment was a “massive signal” to the industry that providing it looked to new methods of production, as News has done with the Times, then there was a rosy time ahead.
The future though may surprise some. Finkbeiner believes that newspapers will become more like magazines, in format, layout, colour and target groups.
Building on Finkbeiner’s optimism was Jim Chisholm, Strategy Consultant of WAN, the worldwide association of newspapers. In a lively presentation the amiable Scotsman spoke under the title ‘The Renaissance of Newspapers’. His lecture was based on a WAN project he has been involved with for the past 18 months, and which has resulted in six new reports, including one entitled ‘Profit from Digital’ which Chisholm says is a serious misnomer. Chisholm says that he has moved from a position of nervousness 18 months ago to one brimming with optimism now, with new titles, new concepts and new methods of production abounding.
He too pointed to the Times and Independent in London, saying that in less than a year of publishing in that new Compact format their success had inspired 50 other papers around the world to follow suit. This has led to a four per cent jump in tabloid’s share of the market this year, up from 34 per cent to 38 per cent. Five years ago it was 30 per cent. What is more, the number of newspaper titles published each year is growing as well. However, he warned that there were issues with tabloids, for instance their yield is 11 per cent less per page than broadsheet, although there is no logical reason why this should be so. He also believes that the downsizing in page size is not limited to tabloids, he pointed to Austria as an example of a country which now had A4 and even A5 newspapers.
One area of success in newspaper publishing is undoubtedly the Metro papers, the free papers given away to young city workers. According to WAN there are now more than 130 cities worldwide that have a Metro, adding up to a 15 million circulation, and just as importantly bringing young readers into the newspaper experience. The concept is still growing rapidly, Chisholm says that in Seoul, Korea, there are not only free newspapers, but two free sports dailies and a free cartoon daily, although he admitted struggling to understand the profit opportunities of that one. He said Metro was also pioneering the concept of cross edition advertising, he cited companies such as Mitsubishi and British Airways that were buying global advertising in Metro through one source.
Like Finkbeiner he believes that magazine style newspapers, or newszines as he called them would rise in the coming years, of course they exist already in publications such as Time and Newsweek, but they were certain to proliferate, according to Chisholm at least.
Of interest to all assembled in Hamburg, and to the wider community, Chisholm believes that newspaper may become the new mass media, as digitalisation leads to the fragmentation of television. When there were only a handful of TV stations advertisers could be fairly confident they would reach everyone. Now with all countries experiencing an avalanche of stations, several hundred in many cases, their position as mass media is being diluted, possibly leaving the road clear for newspaper to step in. Already companies like Procter & Gamble, mainstay TV advertisers for five decades, are leaving the medium because of fragmentation. In the UK for instance the big commercial station is ITV, which as recently as 1999 had a 39.5 per cent share of the audience, today that is down to 23.6 per cent and falling.
Chisholm says that while TV news programmes around the world have trouble paying for their costs no-one would pay to receive the programme, however 800 million people around the world pay for a newspaper everyday, giving them a value that TV news doesn’t have.
Chisholm then gave the results of a study into 18 circulation winners around the world, newspapers that have grown their circulation significantly over the past three or four years. He presented the reasons why, or at least the areas they had in common.
Firstly, was a management that took a long term view. They had an established management, took a consistent position and engaged in slow evolution of the product. He cited the London Daily Mail, which has only had two chairmen and two editors over the past 30 years, and which in terms of profit is the most successful UK daily.
Secondly, these newspaper clearly defined their market, in terms of geography, or groupings or demographics, there was always a clear definition, and then they stuck to it. Next they determined to be the best, hiring the best people and investing in the best technology. They didn’t look to get resources on the cheap, but would look to means to ensure they invested in the best. Interestingly he said that monopoly positions, like those enjoyed by some Australian city papers did not necessarily mean success.
Fourth, all these papers took the view that circulation today equals profit tomorrow, and were focused on building their circulation first. They also all had teams that were committed to each other and the product, Chisholm said in none of these instances did he find the scenario where the ad manager and editor weren’t talking, there was no evidence of backstabbing, sulking or plotting.
He said they also had an outlook that viewed the reader as the customer, with journalists thought of as service providers. He cited Pravda, the former house newspaper of the Russian Communist party as a very successful example of this concept, it continually invited its readers to feedback, and took their comments seriously. They also spent on marketing, an area, which has traditionally been low spend among newspaper publishers.
Surprisingly far from focusing on youth they all focused on the baby boomers, people born in the 15 years after the Second World War and who were now approaching retirement, but who had money to spend. They also focused on females. Of the 18 newspapers 14 had a higher female to male readership, very unusual in newspapers.
Finally Chisholm said they had all faced a ‘moment of truth’ at some point in the recent past, where they had faced the fact that things were not going well, and had put into place actions to stop the rot.
In his conclusion Chisholm said that the industry was in great shape, was emerging with new models, concepts and titles, and was moving from an art to a science He said print media is in robust health, is well placed to take advantage of the opportunities opening up, and that a new younger management was coming into the industry with bright ideas. Renaissance, said Chisholm, is about challenging traditional ideas, and the newspaper industry in certainly in that period.