Australian Newsagency Blog

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Nine newspapers do a deep dive on Bauer’s Aussie foray

Mark Fletcher
July 4th, 2020 · 13 Comments

The Age and the SMH today offer up How a German media company brought Australia’s greatest magazine empire to its knees, a deep dive into the Bauer family’s impact on the once great ACP magazine empire and the wreckage it left. It is worth the read for the reminder of history, the (finally!) acknowledgement of what a stuff up the Bauer influence has been in Australia. It ends on a note of  hope for a brighter future.

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Category: magazines

13 responses so far ↓

  • 1 Steve // Jul 4, 2020 at 1:50 PM

    Clearly the 5th generation Bauer owners are no Kerry Packer. Unfortunately entrepreneurial genes are not often passed down from generation to generation. German arrogance also appears to have played a strong role.

    One common trait with all good entrepreneurs is that they listen to the smart people around them. It looks like the Bauer family are now paying the price for failing to do so. Time for a fresh start and a new Kerry Packer.

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  • 2 Colin // Jul 4, 2020 at 2:39 PM

    And if someone was inclined to write about Fairfax (Age, SMH, IPS, ACM, Rural etc etc) it would be all sunshine and roses and unrivalled success during the same period. Not.

    Gee these publishers love to slag each other.

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  • 3 Peter // Jul 4, 2020 at 3:53 PM

    Very intriguing why Bauer bought ACP in the first place. Surely they could see where magazines were headed. It’s the same deal with South African Woolworths buying David Jones. Hindsight is a wonderful thing, but all the signs where there on magazines and department stores over a decade ago.

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  • 4 Lance // Jul 4, 2020 at 6:48 PM

    I think Peter is on the mark….
    “Surely they could see where magazines were headed”
    These companies don’t spend their $$$s without due diligence.
    They know exactly what they’re buying.
    I feel they bought with intentions of decimating their holdings as a good business decision on their part. They have little regard for the consequences here.
    I believe similar has happened here in Vic concerning Hazelwood Power station.
    Buy It and Burn It………..

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  • 5 Graeme Day // Jul 4, 2020 at 11:08 PM

    Acknowledging the position of trends and thinking it may change or one can do it better is no different than buying a newsagency today or for that matter any other business
    What makes the newsagency buyer smarter than any other person going into business when there is so much uncertainty in the retail sector or consumption business?
    Baurer bought the business thinking they could do better by reversing the trend with the knowledge they had -wrong, the trend was set and it’s a model that can’t be changed except by it’s distribution method which is electronic therefore unable to be competetive on a basis with their business model of income with advertising revenue – no different to newspapers. Where it fails or breaks even in profit mode – only the consumer will decide this Maybe the publisher will pull the plug and close the business altogetherAt least the newsagent can change their model and compete online with a new offer whilst they have the traffic flow of conversion to do so.

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  • 6 Steve // Jul 5, 2020 at 9:33 AM

    My point exactly Graeme. Those newsagents with the entrepreneurial gene are identifying opportunities and adapting to change. Those without it are scared of change and only see risk. They continue to do what they have always done and blame others for decline in sales and profits. Eventually they put their newsagency on the market and if they are lucky they sell though with significant loss on their original investment.

    The 5th generation Bauer family failed to see opportunities and continued to do what their Great Great grandfather did before them. Colin is correct that the 5th generation Fairfax family had the same issue. Opportunities are greater than ever.

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  • 7 Peter // Jul 5, 2020 at 10:56 AM

    I’m not sure what Bauer, or any 5th generation could do differently. The fact that it’s fifth generation is part of the problem. What media business is going to last 1 generation let alone 5 these days. Will Mark Zuckerberg, Jeff Besos or Elon Musk have a business to pass on to their children and grandchildren. I doubt it. Technology is moving so fast these days that they will surely be usurped by the next big thing.

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  • 8 Mark Fletcher // Jul 5, 2020 at 11:16 AM

    I don’t see any of this being about generations of business ownership. It is about what any business is about, giving people what they want / need, when they want / need it and for a price that is reasonable / affordable.

    With content vendors, the challenge that the pace of change in that space is fast right now and many have not adopted.

    For years newspaper and magazine companies had partners at the consumer coal face, newsagents. They ignored them. Now, with their partnership focus more on mass, that opportunity has passed.

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  • 9 Peter // Jul 5, 2020 at 11:48 AM

    I do see it about generations of business ownership. Newsagencies always held that promise, that it was a long term stable and predictable investment. Many newsagents did indeed pass the business onto their children and grandchildren. You paid a premium for that. In return you could bank on selling a large and predictable number of stock items. If you sold 500 Suns on a Sunday,100 New Ideas on a Monday and 70 Trading posts on a Thursday, you’d do the same again next week. The rapidly declining sales have broken that stable and predictable model. Yes, you can introduce new items such as plush and gifts. But you’re not going to have those predictable and stable sales. This is a challenge for newsagents and publishers alike. Newsagents are closing and publishers are reducing their footprint. No one is to blame for this, it’s just that the advantage the printing presses had for over a 150 years has been broken.

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  • 10 Mark Fletcher // Jul 5, 2020 at 11:55 AM

    Peter, that all ended in 1999 when the then coalition government took steps to end authorisation that provided newsagents the commercial certainty in your comment. The situation further changes when print media sales started to decline in the early 2000s, a trajectory that has been maintained ever since except for 6 weeks caused by Covid.

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  • 11 Peter // Jul 5, 2020 at 12:09 PM

    For most newsagents deregulation wasn’t the big change. I believe the real catalyst was the introduction of the iPhone in 2007. The Trading post ceased printing in 2009 with the ipad released in 2010. These were the seismic events for Newsagents and all print circulation rapidly declined from then on.

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  • 12 Mark Fletcher // Jul 5, 2020 at 12:17 PM

    Everyone will have their own view of the when.

    Deregulation substantially weakened the position of newsagents, making them more vulnerable that they would have otherwise been.

    I don’t see one single inflection point. Rather, email, hand held tech, online ad sites like seek.com.au, disinterest in news, diminishing returns from print media ad spend, social media and more are all inflection points, and, there are more.

    The early 2000s gave us plenty of warning signs and some newsagents acted, to their benefit. The next decade gave more signs, and more newsagents acted.

    The reality is, as I’ve been noting publicly for close to 20 years, no one will lead newsagents through this. It is up to each business owner to make their decisions, to position their businesses for their future.

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  • 13 Peter // Jul 5, 2020 at 12:23 PM

    The moment the consumer had the ability to access news and information, for free from a phone carried anywhere in their pocket was the truly Seminal moment for publishing. Yes, the writing was on the wall earlier, but circulation figures entered double digit declines after this.

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