OPINION: Merger shows way to a brave new media world

Hip-hip hooray for Lords Stevens and Hollick. The merger of their two companies lays down a benchmark for the brave new media world. Theirs, probably the first of several such deals, is a bold move and worthy of applause, for it is an attempt to carve out a territory where British media companies need not fear domination by their world counterparts. The City certainly sees it so, moving quickly to mark up shares in both companies.

Hip-hip hooray for Lords Stevens and Hollick. The merger of their two

companies lays down a benchmark for the brave new media world. Theirs,

probably the first of several such deals, is a bold move and worthy of

applause, for it is an attempt to carve out a territory where British

media companies need not fear domination by their world counterparts.

The City certainly sees it so, moving quickly to mark up shares in both

companies.



But what are the likely consequences of the merger for advertisers?

Certainly, the new company is very much a British one. It isn’t a world

player, unlike Rupert Murdoch’s News Corporation, nor a European one.



Nevertheless, the news is good for both Express titles. Lord Stevens may

continue to be at the helm of the papers, but there should be more

resources to invest in them. As part of a larger group, there will be

less pressure to use the papers as cash cows to prop up United’s

dividend. Instead, the new company can take money from other parts of

the group to invest in the papers.



That is cheering for all those who long for decent competition in the

mid market. But what of the Daily Star? A hard-nosed entrepreneur like

Hollick may be less wedded to it than Stevens, whose baby it clearly is.



Second, and perhaps of greater long-term significance, is the potential

linkage between United’s strong regional newspaper portfolio and

Meridian’s TV interests, specifically Channel 5 and whatever it might do

with digital TV. For if there is one area where the benefit should

emerge, it is between local newspapers and ‘local’ TV of the possibility

offered by Channel 5 and digital.



Further out, the new company’s ability to orchestrate cross-media deals

with big advertisers will be a true test of the merger’s synergies. For

all the talk of integrated media companies, advertisers have found these

to be singularly lacking. It would be nice to think this might change.

Then it won’t be just shareholders who benefit.



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