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Reach results

By Tim Rogers
05 March 2024
Technology, Media & Telecomms

It’s not clear who first used the expression; “A licence to print money.” There are several claimants. Whoever it was, it was almost certainly a Media Baron talking about his industry.

That was back in the day, and that day is long gone.

Today, there is still money to be made. But the gradient is steeper, the swagger has left the building, and the Media world is fraught with uncertainty. Particularly in the UK’s nations and regions.

Financial results published today from regional titan, ‘Reach,’ do little to stem the anxiety within journalism.

‘Reach’ is reporting an adjusted operating profit of £96.5m in 2023, down 9% from the previous year. And profit before tax was down 10% to £93m on an adjusted basis.

It publishes more than a 100 local news brands, as well as national titles such as the Daily Mirror, Daily Express and Daily Star.

In some parts of the UK, it dominates whole nations – such as Wales – and regions across the UK, including the Northwest.

As recently as November last year, Reach announced 450 redundancies on top of hundreds more that have gone in recent years. But they are not alone.

The decline in traditional print has been well documented across the Western world. What makes today’s announcement particularly worrying is that the escape route for the Media – the transition to digital– shows signs of frailty too.

Digital revenues at Reach have been hardest hit. They fell by 15% to £127.4m. Falling referral traffic from Facebook and Google and lower returns from programmatic advertising contributed to the digital revenue decline.

Ironically, revenues from print were shown to be more resilient – but still down – falling by 2% to £438.8m. That doesn’t mean that print sales are holding up. It is more to do with the reduced cost of newsprint – 21st cheaper than 2022.

But ‘Reach’ is not alone. It is a bell weather of factors which make finding the silver lining in the Media cloud more difficult.

According to the UK Press Gazette, last year was brutal for the journalism industry. It estimates that 8,000 jobs were lost in 12 months in the US, Canada, and UK. And UKPG has found that this year hasn’t started any better. A further 1,000 jobs were lost in January alone. So quickly are jobs going, that the UKPG is keeping a log which is showing cuts are happening day by day.

To the end of February, cuts were announced a The Wall Street Journal, and online news sites such as Vice and Buzz Feed.

So, is journalism as we know it on a road to oblivion?

An MPs Department of Culture Media and Sport committee last year found that 300 local newspaper titles closed between 2009 and 2019. Without Government support – and special measures such as allowing newspaper to receive charitable status and tax breaks, the decline, and the impact on local democracy, will go on. But is the Government listening?

In British Universities and Colleges, Media Studies courses in the last 20 years have been oversubscribed. Not any longer.

The University of South Wales has scrapped its BA course in Journalism, and a consultation process has begun at the University of Kent to cut one of its journalism courses too.

It is probable that they won’t be alone. Setting up Media centres complete with newsrooms – radio and TV studios – is expensive. Easily cut in an uncertain world where the promise of jobs in journalism is diminishing.

But is this the complete picture?

Matt Walsh, Head of one of the UK’s most prestigious journalism schools at Cardiff University, remains optimistic. He says that while it is true that traditional routes into journalism – such as local newspapers and local radio – are diminishing, journalism and media graduates are finding employment and building careers.

He says, “It would be easy to paint a gloomy picture by looking at traditional Media, but there are still many opportunities across the creative industries as a whole.”

Cardiff University, and City University in London, are leaders in journalism education and training and they are likely to remain in high demand.

It is estimated that there are 100,000 still working in the Media industry and recent surveys show that figure is holding, despite diminishing returns for some of the larger companies.

In the industry, the word is that recruitment is focused on younger less experienced staff – as cuts, where they are occurring, impact older and therefore more expensive employees.

One prestigious journalism college surveyed alumni to gage the length of their careers in journalism.

They found that, on average, after graduating, males stayed in journalism for 18 years while females stayed in for 15 years. Most moved on after that, either out of the industry altogether or to other corners of the creative World.

So where does this leave us? With uncertainty, a nervous profession and change – inevitable change – ahead.

What shape that new form will take is the subject of continual debate. But no one is talking about a licence to print money anymore.