I spoke with Catrin Thomas – Director of Retail Circulation at News Limited, this morning about their decision to suspend the T2020 newspaper distribution consolidation trial in Queensland.
The trial itself is what has led to the decision to suspend T2020 as planned and to move to a more free market approach. News will shortly announce details of how newsagents can engage in their locally-driven territory consolidation models. They will also launch a new website to support this.
Catrin advised in the call that News remains committed to consolidated territories but that they will not set a size requirement for a consolidated territory. They are also committed to their public statements regarding financial viability of distribution newsagents. News also remains committed to the separation of distribution and retail activity.
Newsagents will be invited to submit proposals to News. While I expect that Associations will suggest that proposals come through them, I’d encourage newsagents to develop plans and submit them directly through processes to be announced by News.
The challenges encountered in the trial remain and some newsagents who do not navigate these challenges will find themselves in difficulty in the more competitive world that will now emerge. The extent of difficulty will depend on geographic situation and other factors. News is not saying this – it’s purely my observation / speculation.
What has changed are the trial itself in Queensland and the roll out by News down the Eastern Seaboard. The goals and principles remain the same. The move to a more market driven approach will provide proactive newsagents an opportunity to move sooner. It also opens up the prospect of competition from outside a territory. This could play out well for existing newsagents but it could equally intensify the challenges they face.
There is no reason for a distribution newsagents to adopt a wait and see approach. Now is the time to be on the front foot, pursuing change, pursuing what is best for your business. No one can tell you what to do in terms of your business other than the fact that you now need to do something – the timing is yours to embrace.
Footnote: It’s been suggested to me that one or more associations may create a commercial entity through which newsagents bid for and or drive consolidation. I’d see such a move to be outside their role as an association. They have no role to play in operating commercial enterprises.