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| Monty is back - a rational man to rationalise regional newspapers | Monty is back - a rational man to rationalise regional newspapers |
| (about 1 hour later) | |
| Updated 10.30am: When David Montgomery was ousted as chief executive of Mecom in 2010, I wrote a lengthy appraisal of his remarkable career as both a journalist and newspaper businessman. In the final paragraph I said: | |
| "It would be foolish to write off a man who has had comebacks to rival those of Frank Sinatra. As he said when The Guardian bumped into him at last week's party to celebrate 40 years of Saatchi & Saatchi, 'Some people think me and retirement don't go.'" | "It would be foolish to write off a man who has had comebacks to rival those of Frank Sinatra. As he said when The Guardian bumped into him at last week's party to celebrate 40 years of Saatchi & Saatchi, 'Some people think me and retirement don't go.'" |
| Indeed. Retirement for an ambitious man - now aged 63 and with an unshakeable belief in his own talents and a burning desire to prove his detractors wrong - was unthinkable. | Indeed. Retirement for an ambitious man - now aged 63 and with an unshakeable belief in his own talents and a burning desire to prove his detractors wrong - was unthinkable. |
| So the only surprise in the revelation that he has constructed a company, Local World, to effect a consolidation of regional newspapers is that has taken him as long as two years to make a comeback. | So the only surprise in the revelation that he has constructed a company, Local World, to effect a consolidation of regional newspapers is that has taken him as long as two years to make a comeback. |
| That said, can Monty really bring it off? He is acutely aware of the continuing advertising revenue problems that are besetting the industry across the world, having suffered its effects at the helm of Mecom. | That said, can Monty really bring it off? He is acutely aware of the continuing advertising revenue problems that are besetting the industry across the world, having suffered its effects at the helm of Mecom. |
| As a consistent cold-blooded cost-cutter, he has plenty of experience in making cuts. He will have been watching from the sidelines as the current owners of the largest chains have carried out a prolonged series of cutbacks. | As a consistent cold-blooded cost-cutter, he has plenty of experience in making cuts. He will have been watching from the sidelines as the current owners of the largest chains have carried out a prolonged series of cutbacks. |
| But he will also be aware that cuts are not, by themselves, the answer to extending the life of regional newspaper businesses. The next step for large newspaper groups struggling to maintain profitability is an extensive rationalisation of the entire nation-wide structure of the industry. | But he will also be aware that cuts are not, by themselves, the answer to extending the life of regional newspaper businesses. The next step for large newspaper groups struggling to maintain profitability is an extensive rationalisation of the entire nation-wide structure of the industry. |
| Proprietors believe that greater consolidation is long overdue, allowing for improved economies of scale and title closures and mergers. | Proprietors believe that greater consolidation is long overdue, allowing for improved economies of scale and title closures and mergers. |
| Regulators have stymied deals between owners - as they did with Northcliffe Media's attempt to sell off titles to the KM Group in Kent - and that has scared off other plans for title swaps and mergers. | Regulators have stymied deals between owners - as they did with Northcliffe Media's attempt to sell off titles to the KM Group in Kent - and that has scared off other plans for title swaps and mergers. |
| Monty, however, is just the kind of newspaper manager who will be willing to confront the authorities. He is not afraid to take risks. And there could not be a more rational man to carry through a rationalisation. | Monty, however, is just the kind of newspaper manager who will be willing to confront the authorities. He is not afraid to take risks. And there could not be a more rational man to carry through a rationalisation. |
| It is particularly interesting that the heart of his proposed new empire should be Northcliffe Media. It has been guided for 18 months by Steve Auckland, a manager sent in by the parent company, Daily Mail & General Trust (DMGT), to carry out a ruthless rationalisation of the business. | It is particularly interesting that the heart of his proposed new empire should be Northcliffe Media. It has been guided for 18 months by Steve Auckland, a manager sent in by the parent company, Daily Mail & General Trust (DMGT), to carry out a ruthless rationalisation of the business. |
| To that end, he turned dailies into weeklies, closed some titles, switched frees into paid-fors and reduced staffing. The result was a return to profitability, prompting Auckland to tell investors in April this year: "Many of you may see Northcliffe as a challenged operation, but I see this business as an unappreciated asset." | To that end, he turned dailies into weeklies, closed some titles, switched frees into paid-fors and reduced staffing. The result was a return to profitability, prompting Auckland to tell investors in April this year: "Many of you may see Northcliffe as a challenged operation, but I see this business as an unappreciated asset." |
| Unappreciated, evidently, by DMGT itself. Well, not quite. Note that the reports of Monty's initiative suggest that DMGT would take a stake in Local World. | Unappreciated, evidently, by DMGT itself. Well, not quite. Note that the reports of Monty's initiative suggest that DMGT would take a stake in Local World. |
| Monty's other partner is Yattendon, the family-owned media and property group, which runs 39 titles - such as the Cambridge News and the Hertfordshire Mercury - through Iliffe News & Media. | |
| Updated pars: According to the latest reports, Yattendon, DMGT and Trinity Mirror would between them own close to 75% of Local World, while Monty will have a substantial stake himself. He will surely be in the driving seat. | |
| Bringing together Northcliffe, with 91 titles (including the Leicester Mercury, Bristol Post and Derby Telegraph), and Iliffe means a merger of companies that are currently listed as the fourth and 11th largest publishers by circulation. | Bringing together Northcliffe, with 91 titles (including the Leicester Mercury, Bristol Post and Derby Telegraph), and Iliffe means a merger of companies that are currently listed as the fourth and 11th largest publishers by circulation. |
| The addition of titles from Trinity Mirror, the biggest regional publisher, could potentially take it to the top of the league ahead of the other two big players, Johnston Press and Newsquest/Gannett. | |
| But Monty is sure to see his new company merely as the beginning of a process. He was very upset at being forced to stand down in 2000 after the Trinity Mirror merger and I understand he has never come to terms with that reverse. | |
| So I would expect Trinity to figure in some way in his ambitions. If Local World gets off the ground I think this could well be a major turning point for the whole industry. | So I would expect Trinity to figure in some way in his ambitions. If Local World gets off the ground I think this could well be a major turning point for the whole industry. |