It's War
A few weeks ago the Times was abruptly transferred from the famously intimidative and influential Thunderer into a give-away newspaper. Anyone could go into a newsagent and pick up a copy for nothing. In fact they could go there and pick up all the copies and walk out with them—which, considering the price which old newspapers now command, might not have been a bad idea.
This was not the result of Rupert Murdoch doing his misguided bit towards introducing a system of free access to wealth. What actually happened on that unusual day was that the entire print-run of the Times—which, in expectation of a surge in demand had been doubled—was bought by the Microsoft computer firm who then gave them away. Well, not exactly gave because the operation was part of the huge, expensive publicity drive for Microsoft’s new Windows 95, which is going to make life so much easier for us as long as we don’t mind the continuance of a few minor problems like war and famine and poverty and homelessness . . . It was also an episode in the circulation war which has been raging for the past two years between the newspapers, in which the Times and the other Murdoch papers are the most aggressive and the most successful.
"Giving away" the Times was an extreme example of the price-cutting which has been the weapon most often used in the circulation war. The Murdoch papers began this, two years ago, by straightforward reductions in the price of the Sun and the Times. Since then it has taken the more complex form of a discount on the price of a Sunday paper provided you buy its stablemate on a Saturday and fill in a coupon (which, unless you are careful, can also result in bringing you a shoal of junk mail as your name and address are passed on to numerous mailing lists). So anyone whose form-filling skills enable them to complete the coupon can get the Sunday Times and the Observer for 50p each and the Independent on Sunday and the Sunday Telegraph for 10p each. Of course they may not then be able to find time to read them all, nor to mention all that junk mail, but they will have done their bit for the circulation figures.
Attrition
At times the price-cutting has resembled the attrition of the First World War trenches; in fact to some observers it has been not far off mass suicide. The Murdoch papers, for example, may have lostaround £100 million over it and the total loss for all newspapers is estimated to be as much as £200 million. But, unlike what went on in the trenches, Murdoch can show some significant advances. Over the past two years the circulation of the Sun has gone up by 16 percent and of the Times by a staggering 94 percent. On other sectors of the front, the Daily Mail and the Daily Telegraph (where the losses have been about £45 million) have crept forward by some 4 percent, while the Guardian and the Daily Express have both been forced into retreat. To put this into perspective: overall sales have increased by just over 3 percent and for the Sunday papers they have dropped since 1984 from about 18¼ million to 15½ million now. Which does not say much for the liberating and expansive results supposed to flow from what is known as free competition.
Price-cutting has been part of a pincer movement on newspaper finances, the other jaw of which has been the soaring cost of newsprint, now 50 percent higher than it was at the end of 1994. (Which is why it would have made good sense—the sort of initiative which Rupert Murdoch should approve—for some thick-skinned operator to snaffle all those "free" copies of the Times and flog them to the nearest scrap merchant)
It is not surprising that out the smoke and noise of battle the best chances of survival are with those who are wealthy and diversified enough to withstand temporary losses—or even to provoke them in order to damage the opposition. The two big groups now are Murdoch’s News International and the Mirror Group, which control 11 of the 21 better known national newspapers, commanding about 63 percent of the market. It is worth remembering now that the so-called Murdoch revolution which moved the newspaper works out to the bastions of Wapping, smashed the trades unions, sacked thousands of workers and tamed those who survived, was justified on the grounds that from it would emerge a freer industry in which smaller, independent newspapers would flourish.
Profits
In case anyone is any doubt about how big they are, in August News International announced a doubling of their profits to £778.7 million. A lot of this was due to the sale of the group’s stake in satellite TV but is was also helped by the £57.5 million higher revenue from newspapers (although this was cut by the increased cost of newsprint). Additional unease came from higher advertising rates—usually a reflection of confidence about circulation figures—which in the case of the Times and the Sunday Times are notably successful part of their operations.
So in all-in-all Murdoch’s group is in buoyant mood. This, after all, is what capitalism is all about—competing for markets, screwing the best deal possible in a disputed situation, treating human beings who are employed by you as figures on balance sheets. It is also about that most important function of the press— deceiving people in the mass that this is the best, historically the highest and most efficient, way to run society when in fact it is the most effective and ruthless way of exploiting people, of repressing them and when the time comes disposing of them.
Ivan
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