Out With A Bang

For obvious reasons, this fascinates me…

And apologies about being a couple of days out-of-date; blame www.2gether08.com – and fair play to Mr Steve Moore for organising said event.

But anyway, the suggestion that TrinityMirror and Johnston would be best advised throwing their hand in together…

http://www.independent.co.uk/news/business/sharewatch/market-report-broker-moots-merger-of-trinity-and-johnston-858351.html

Or more particularly…

“ABN Amro said that, given the problems faced by the media sector, “shareholders and management will increasingly press for industry consolidation”. “These are desperate times, and they call for desperate measures: we believe a Trinity/Johnston combination makes sense,” ABN said.

“The geographical fit is no ‘dream ticket’, but Trinity has an urban bias, while Johnston has a rural bias, so geographically the fit is not bad.”

“According to the broker, a merger of the two will bear estimated cost savings of up to £40m, or 5 per cent of the combined cost base.

“ABN also upgraded Trinity to “hold” from “sell”, citing confidence in national newspapers. The stock fell regardless: negative comment from a number of brokers, and an inclement market, took Trinity down by 13.75p to 95.25p. Johnston Press also succumbed to the market trend and lost 5.25p to 46.75p…

The end of the week has brought little imptrovement, of course. Trinity finished the week at 91.50; Johnston at an eye-watering 31.50. Imagine the cold that Deutsche Bank would have caught had they still been sat on their recent position – of under-writing the rights share issue at 53p a pop.

But, for me, that’s not where the interest lies in The Independent piece.

It’s the use of the word ‘geography’. Twice.

Or rather ‘geographical’ and ‘geographically’ – as in the ‘fit’ being ‘no dream ticket…’

It only improves in the broker’s eyes when you view Trinity in an ‘urban’ light; Johnston in a ‘rural’ one.

Which for me, has a slight air of straw clutching to it.

E-bay makes no such distinction; nor does FaceBook; nor RightMove.

These – as we’ve said many a-time before – are communities without boundaries; the web doesn’t do geography. End of. Hyper-local or hyper-niche – yes, potentially.

Hyper-national (stroke global); yes. It does nothing in-between.

http://outwithabang.rickwaghorn.co.uk/?p=44

The other intriguing point to all this is the ‘very upbeat’ assessment the Newspaper Society chose to deliver to Lord Fowler’s House of Lords committee; which in turn ensured that their lordships recommended little or nothing that would make such consolidation an easy process.

In fact, quite the reverse. Now you could have OfCom’s mits all over any deal as well….

http://outwithabang.rickwaghorn.co.uk/?p=99

But it is clear that both recognise that they have to abandon geography as an organisational principle ASAP; it is, you suspect, what Trinity were thinking with the recent launch of their ‘Banter…’ sites…

http://outwithabang.rickwaghorn.co.uk/?p=80

Team up with ‘rural’ Johnston and now, in theory, they could have a way of pumping, say, MKDons football content through the Banter brand… provided, of course, that Johnston was happy for its own content to be re-branded in that fashion…

The only difficulty being, of course, that Johnston’s title in the rural, rolling farmland of Milton Keynes is their weekly free paper the Citizen… which then poses all manner of integration issues content-wise if you are seeking a 24/7 digital feed out of a weekly – or, indeed, a bi-weekly title.

Again all of these boys have already – at great expense – built their own, bespoke CMS systems; branded their local sites icBirmingham in one case, PeterboroughToday in the other; their classified ad sections can be icMotors or jobstoday… but if consolidation is ever to drive the kind of savings that they need, then this whole delivery structure needs to integrate.

That way an advertiser in Peterbrough can ‘cascade’ his advert down through Birmingham elegantly and easily.

If not yet through Bristol, Nottingham, Derby, Leicester, Hull or Stoke.

Or, indeed, Norwich, Ipswich or Colchester.

Irrespective of whether or not the OfCom-enhanced Competition Commission of Lord Fowler’s imaginings actually allows the kind of consolidation the market is screaming out for – remember: consolidation doesn’t come at the expense of journalists’ jobs – if the geograpical fit between Trinity and Johnston is no ‘dream ticket’, then you can bet your bottom dollar that fitting their existing advertising and editorial platforms together in a bid to re-organise themselves in a truly, super-efficient fashion will be no dream ticket either.

It’ll be the proverbial nightmare. It’ll cost an arm and a leg and take forever.

Right now few of us have got either that much time or that kind of money.

And as those share prices tumble ever further south, as far as TrinityMirror and Johnston Press are concerned day by day they have even less time and even less money before the darkness descends.