Sunday, October 04, 2009

The Evening Standard Gambles On Free

Newspapers can’t seem to decide what to charge or not charge for their content and the impact is not just with digital but physical copy too. Rupert Murdoch had said his websites which include the Sun, the Times and the Wall Street Journal will start charging for digital content. The Financial Times announced it planned to rely less on advertising revenue and more on subscriptions as it charged readers to access much of its web content. However in a move that somewhat took many by surprise the London Evening Standard is to give its physical paper away free after 181 years of people paying for it.

Russian billionaire Alexander Lebedev bought a controlling stake in the loss-making London Evening Standard in January for a nominal sum of £1 after almost a year of secret negotiations with Lord Rothermere's Daily Mail & General Trust. The colourful Lebedev is a former KGB agent who developed a love for the Evening Standard when he was based in Britain at the Russian embassy.The Standard, which is 75.1% owned by Lebedev and 24.9% owned by Associated Newspapers, will go free from 12 October. In August the paper sold just 107,680 at the full cover price. A further 8,500 copies were sold at below the basic cover price. The Evening Standard is understood to lose more than £10m a year.

The Standard plan to increase from about 250,000 to 600,000 copies a day and in doing so hopefully double its current readership. The aim is to be more attractive to advertisers and increase its appeal to readers across London. It could certainly mean the end of the existing free evening paper, London Lite, only a few weeks after the other London free evening paper The London Paper withdrew from the streets (perhaps they got wind of the Standard’s plan). The thing that differentiates the Standard from the free papers is its quality and content and its going to be interesting if this can be maintained under the new model.

The Standard is taking a huge gamble and one that has little room for manoeuvre if it fails – they can hardly reverse the policy and say they got it wrong. They also have doubled their costs in their print run and distribution and also upset their distribution channel in small shops and sellers on the street. The Standard are also widely reported to be in advanced discussions with Network Rail, WH Smith and Canary Wharf about distributing the 182-year-old title.

1 comment:

Anonymous said...

Your blog reveals a poor understanding of the business of publishing newspapers. Distribution costs will be slashed if it goes free, of course, and printing costs should rise little. And why should they care what the newsagents think ? They've already said they are going to retain their vendors.