One of the nice things about writing a weekly column is that one
minute you’re sitting there wondering how to fill the next one when
someone rings up to complain about the last one ... and your problem’s
solved.
So my thanks go out to a man from the Independent who rang up to give me
some grief about last week’s column.
Naturally we had to agree to disagree, but in the course of the
conversation we touched on the vexed subject of the Times’ 10p Monday
sale and its latest ’outrage’ - copying the Telegraph subscription
scheme by offering the Times and Sunday Times for pounds 1 a week (yes,
folks, that’s the same subscription scheme News International spent all
summer slagging off) - which is denting and will continue to dent the
circulation of both Independent titles. ’Well,’ I said, ’what are you
going to do about it?’, fully expecting the Independent to respond in
kind.
His answer surprised me, the nub of it being that the non-Murdoch
newspapers believe they have a case under the Government’s new
competition bill. To this end, they plan to get together to force the
Board of Trade President, Margaret Beckett, to confront the issue. In
both Australia and America, my new best friend told me, it is illegal to
sell something at below production cost. Therefore, just as the dumping
of cut-price Czech washing machines should be outlawed, publishers (ie
the Times) should not be allowed to sell at a cut price. Hooray, we
said, having at last found something to agree on.
But on reflection I found myself wondering if the Times or Telegraph
shouldn’t be able to sell for any price they choose. Seductive it may
seem, but the parallel with Czech washing machines is not helpful. If
you make washing machines, your only revenue comes from the sale of the
machine. But newspapers get revenue both from the product itself (the
cover price) and ad revenue.
So, in a free market, why shouldn’t a publisher be able to forego one
(ie cover price) in order to maximise the other? In a nutshell, whether
via the newsstand or the subscription offer, this is the route chosen by
the Times and Telegraph.
Funnily enough, this practice goes on all over the place in the world of
magazines and regional newspapers - it’s called controlled
circulation.
And it’s not anti-competitive: wherever you look, there’s no evidence to
suggest that, on their own, frees have ever put paid-fors out of
business. In Campaign’s own sector, three of the four titles have chosen
to forego cover price revenue to concentrate on ad revenue, leaving one
(that’s Campaign, for those of you who hadn’t worked it out) to earn its
corn from both. I defy anybody to claim our sector is neither lively nor
competitive.
While I don’t wish to be an apologist for the Times, there comes a
moment when the prospect of more special pleading from the national
press is a turn-off. If they don’t like the heat, they know what to do
