News UK’s apparent plans to cut journalists’ jobs shows the threat profit-hungry owners pose to journalism. Will the Government step in?

In 1981, News International (now News UK) completed its acquisition of The Times and The Sunday Times newspaper titles. The deal made News International by far the most powerful force in the national UK newspaper market, with the two titles joining the News of the World and The Sun in the Murdoch stable. Given the UK’s traditionally very high national press readership figures, this gave Murdoch unprecedented political influence in Britain.

But the deal for The Times and The Sunday Times came with conditions, negotiated between News International and the Government.

These can be broadly summarised as follows, in terms as they apply today:

  1. The Times & Sunday Times must be published as separate newspapers.
  2. News UK, cannot, without the consent of a board of “Independent National Directors”, sell the newspapers.
  3. The Independent Directors’ approval is required for the hiring and firing of editors of either title.
  4. Editors alone retain control over political comment in the papers.
  5. Only editors can give instructions to journalists.
  6. Editors alone retain control over newspaper content.
  7. Only editors can hire and fire journalists.
  8. Independent Directors must arbitrate any disagreement between editors and owners.

Further conditions, from which News UK were released in 2019, had prevented the sharing of staff and resources between the two titles.

These remaining conditions (described, in modern legislation, as “Undertakings”) were intended to protect employees, Times readers, and the general public, as well as providing protection for a healthy democracy from a single overweening proprietor.  So what are News UK’s reasons for applying for their release?

 

Cutting costs

News UK claim that dissolving the conditions will enable them to reduce costs – not an unreasonable objective in itself.

And indeed, savings can be derived from operational efficiencies.  If some administrative functions can be shared across titles, it may be possible to cut costs without losing journalists and suffering a decline in quality.

But as News UK set out in their application, these efficiencies were achieved in 2019 when the Government agreed they could be released from the conditions relating to resource-sharing (the reference to “acceptance of the undertakings” refers to this change in 2019):

While there are some shared services across non-editorial areas of News UK’s business (such as marketing, finance and procurement, logistics, paper and ink) and, since acceptance of the Undertakings, some sharing of journalistic resources between The Times and The Sunday Times, the two titles otherwise operate as entirely separate newspapers.

It soon becomes clear from the current application that this is not where News UK intend to make savings.

Despite already beginning to integrate journalists working across the titles in some areas, News UK fear that doing so in others might violate the remaining conditions.

The application adds,

There are now shared journalistic teams in the following areas: Sport, Sport production, Travel, Property, Money and Features production. Whilst maintaining the independence of The Times and Sunday Times news desks, News UK currently intends to take further steps to integrate feature desks across seven days, and to merge editorial services across both titles including pictures, graphics, subbing and production.

Across the industry, integrating editorial desks typically results in redundancies.

Enviously describing other titles, the application adds,

An important means of reducing titles’ cost bases, without compromising their quality, has been for publishers to bring about greater integration between the Monday to Saturday and Sunday editions for their papers; thereby eliminating substantial duplication of costs. Over recent years, most major national titles with Sunday editions have moved to a position where they not only share back-office functions, but have also achieved a significant degree of integration in their newsrooms; sharing reporters and editorial staff across Monday to Saturday and Sunday editions.

If that wasn’t clear enough, the application then points to the example of Reach, publisher of the Mirror, Express and Star, which has cut jobs by 70 through a similar process:

Indeed, publishers have typically appointed either a single editor for both editions, or an editor-in-chief into which the editor of each edition reports. In addition to savings from integration of weekday and Sunday editions, some companies have been seeking savings from across different titles.  For instance, Reach announced plans to reduce staff by 70, by combining operations across the Mirror, Express and Star.

Of course, while redundancies are damaging to newspapers, they are sometimes necessary – and many publishers have faced a squeeze on their finances over the last twenty years, with advertising income declining.

But The Times Group Newspapers – before COVID at least – was profitable.  In 2019, the paper boasted that,

“Increased turnover and reduced expenses helped the publisher of The Times and The Sunday Times to make an annual after-tax profit of £9.6 million”.

Owner News UK is a part of News Corp, whose revenue is counted in billions.

News UK’s application does vaguely refer to other costs associated with the conditions, specifically citing the costs of maintaining the Board of Independent Directors.  But this cost is likely to be minimal.  It seems clear that the real savings to be made will be from cutting journalism jobs simply to increase corporate profits.

The Government should reject it on that basis alone.

 

Arguments of competitive disadvantage and state oversight

In addition to financial disadvantage, News UK’s application also claims the conditions put them at a competitive disadvantage, and raises an objection of principle to “oversight” from a state Department (the CMA, which enforces these undertakings).

It is hard to understand how requiring an owner to stay out of a publication’s day to day editorial decisions would lead to a competitive disadvantage.  News UK appear to be short of arguments on this point, with much of their application focused on claims of financial disadvantage.

Their third complaint is a general objection to oversight from the CMA on the basis of it being a state organisation.  This would have more credibility if it came from an organisation which has not been so aggressively lobbying for such oversight of other kinds of media organisations.

In November of last year, The Times expressed its support for statutory regulation of social media platforms (which would be by Ofcom, an organisation chaired by a Government appointment):

It may be 2022 before the publication of the already long-delayed Online Harms Bill, which would finally introduce a statutory regulator for social networks.

The Times isn’t even averse to the CMA itself getting involved in regulation affecting its papers, when it suits the paper’s commercial interests.

In July 2020 it published an article from News UK’s own lawyer, backing a CMA Report which recommended a new regulatory body within the CMA for the online advertising market (which, The Times perceives, unfairly deprives newspapers of advertising revenues enjoyed by social media companies).

In any case, the CMA’s enforcement of the conditions is a minor form of oversight – and one News UK entered into, to protect the titles and the public, as a condition of its purchase of the newspapers in 1981.  Overall circulations may have decreased, but hard copy and online readership of News UK publications is still high, and the national press across all platforms retains its political influence in Britain.  Those concerns are therefore as important today as they were forty years ago.

 

This application should be rejected

In summary, News UK’s application could make way for a cost-cutting raid on journalists’ jobs.  There are no other compelling reasons for the publisher’s release from the conditions.

The Government will have the final say on News UK’s application.  In the interests of the hundreds of journalists who work at the titles, as well as sustaining a plural news environment, they should reject it.

 

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