A massive increase in newsprint prices expected this year will threaten the viability of many Australian newspapers, publisher ACM has warned a federal parliamentary inquiry.
"It is perhaps the single biggest threat to the viability of our publishing business, after COVID and its economic effects," ACM managing director Tony Kendall says in the company's submission to federal parliament's inquiry into regional newspapers.
"We are confronting extra costs for paper alone that are equivalent to the salaries of 50 journalists," Mr Kendall says.
"These increases will likely cause the closure of titles that are teetering on the edge of profitability and will put even our biggest publications under significant cost pressure."
In a sobering outline of the crisis facing hundreds of local newspapers serving the 36 per cent of Australians living outside the major metropolitan cities, Australia's largest independently owned publishing business has painted a stark picture of an industry at "breaking point" and in need of urgent government attention and assistance.
ACM, the publisher of this masthead, has told the inquiry committee chaired by Victorian Nationals MP Dr Anne Webster and made up of Liberal, Labor and Nationals MPs that the company would have stopped trading without the federal government's timely support through JobKeeper and the Public Interest News Gathering fund.
Emergency funding granted under the $50million 12-month PING program had enabled ACM to return more than 100 mastheads to print or digital publishing through the pandemic - more than was originally foreshadowed in its 2020 grant application.
The publisher's 5000-word submission to the inquiry also reveals:
The ACM network, which includes 14 daily newspapers such as The Canberra Times and Newcastle Herald, reaches 6.4 million regional Australians every month online and in print and has more than 110,000 digital subscribers across more than 40 mastheads.
The company, which employs more than 1300 people around the country including 600 journalists, says it has "made every effort through the COVID disaster to maintain as many of our local mastheads as possible and employ as many regional journalists as possible".
Of the 50 publications that had not returned to printing through the pandemic, more than 20 retained a digital presence and 20 others were free titles circulated in areas already covered by another ACM newspaper.
"In cases where we have been forced to make changes to titles, communities have felt let down and abandoned. We understand this completely," Mr Kendall says in the submission.
"It is understandable, given the intense sense of ownership regional communities feel for their local newspapers, that they are viewed as a community service rather than as a business. But newspapers, like any business, must be profitable to survive. We cannot run them at a loss."
In a message to staff on Tuesday, Mr Kendall said: "Our submission paints a stark and honest picture of the situation, but we are fighting every day."
ACM says it is continuing to invest in training, new apps for its daily newspapers and a redesign of its websites.
"We have expanded the political bureau at The Canberra Times so that it can serve our entire network with accurate, balanced, independent reporting from federal parliament. We have expanded our video and audio capabilities and launched new titles in some areas where News Corporation has closed its newspapers. And we have hired a small team of property reporters to drive audience to our real estate portal in the hope that this will provide a longer-term source of revenue to sustain our journalism."
Programs like the government's newly announced $10million Journalist Fund to train junior journalists in the regions were welcome, but Mr Kendall said ACM did not want to "become reliant on continuing government handouts".
Instead, the company has urged the inquiry to consider long-term changes to support all regional newspapers.
The measures it recommended would allow regional publishers "to survive and grow on their own merit" and remove the need for "Band-aid" measures such as grants. They include:
The ACM submission also emphasises the need for Australia's outdated media ownership laws to be overhauled to level the playing field for regional media.
Different rules applying to regional and metropolitan media prevent ACM from merging with a regional television broadcaster without divesting parts of its publishing portfolio.
"It's illogical and unfair that a regional company like ACM is prevented by decades-old legislation from growing in the same way that metropolitan media has been allowed to evolve in the Netflix age," Mr Kendall says. "ACM is the only company in the country that is trying to build a 21st century media business to serve regional Australia, but we are doing it with one arm tied behind our back."
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