The publisher of the Sun and the Times has warned of impending job losses as part of a major cost-cutting programme as the coronavirus pandemic hammers newspaper sales and advertising revenue.
Rebekah Brooks, the chief executive of News UK, has sent an email to staff announcing that the business needed to “reset” with the coronavirus hastening the shift towards digital publishing.
“In the coming months, we need to streamline the business and take some tough decisions, saying goodbye to some valued and talented colleagues,” said Brooks. “In order for us to be able to continue to invest and to deliver a profit, we need to have a laser focus on costs and to take a hard look at the whole business. We need to fast-forward our transformation programme towards a digital future. We are now starting a process of reviewing the business in detail and determining the areas that will drive our future growth.”
Newspaper publishers have benefited from record digital audiences as readers crave news on the coronavirus. However, with businesses shut down and many advertisers keen to steer clear of running promotions around content relating to the pandemic, publishers have suffered a significant decline in print sales and advertising revenue.
Brooks indicated that there was set to be an even closer alignment of the printed editions of its papers, following the move to share resources between the Times and the Sunday Times last year, which had operated strictly independently since Rupert Murdoch acquired them in 1981.
“Print remains a vital part of our business and will continue to do so for many years to come, but in some areas it may make sense to change the package that we offer to customers,” she said. “We need to maximise our resources, remove duplication and become a simpler business. We need to transform ourselves and leave legacy ways of working behind.”
Brooks is undertaking the review after setting the company’s overall budgets for the next financial year to June 2021. Executives have now been told to “review and reshape” their own area and “consider all of their output and assess how we can do things better - and what we might stop doing”.
She added that News UK would start to work more closely with parent company News Corp, which also owns book publisher Harper Collins and Dow Jones, parent of the Wall Street Journal, to centralise business support functions.
The Sun and Sun on Sunday made a loss of £68m last year, while the Times and Sunday Times, which has more than 300,000 digital subscribers and has now branched out into radio, made a profit of £3.4m.
“It is my duty to ensure that the business is reset for a secure and sustainable future,” said Brooks.
Separately, Reach, the publisher of the Daily Mirror, Daily Express and hundreds of regional titles including the Manchester Evening News, has been hit with a collective grievance case from the National Union of Journalists on behalf of journalists over how coronavirus cuts have been implemented.
The grievance summarises a range of issues over the lack of a formal consultation process by management when almost 1,000 staff were furloughed and employees took a 10% pay cut. The measures were unilaterally announced on 6 April, with the cuts backdated to 1 April, despite government guidance that management should consult with staff over contractual changes.
“No prior warning or consultation took place either at local, regional or national level before employees were informed,” said Chris Morley, northern & Midlands senior organiser at the NUJ, and Laura Davison, national organiser, in the letter to Reach.
“Members seek resolution with a declaration by the company of when the pay cut will cease and mechanism by which the sums deducted will be compensated for, including the element retrospectively cut. If our members’ concerns are not resolved through the grievance process, then those members reserve their right to issue [legal] proceedings.”
