The Tribune in trouble?

For most newspapers the loss of a comic strip or “funnies” writer would be inconsequential to its operations. However when said feature has been described by the newspaper’s editor as the reason why most people buy the paper it’s a different story.

As smugly recounted in The Irish Independent recently, Ross O’Carroll Kelly writer Paul Howard has called it quits with the perpetually-struggling Sunday Tribune newspaper. Given that just a year ago the newspaper made Howard’s creation the single focal point of a massive advertising campaign should imply just how prized a possession the weekly column was for it and how damaging its loss will be.

This negative development is just one of man problems facing the Tribune at the moment. The newspaper has been propped up by INM loans since its 1992 takeover bid was blocked – the cost of which are in the tens of millions – but the media landscape in Ireland has changed dramatically since then, as has the situation for INM.

The reason for INM’s involvement in the Tribune is largely because of Rupert Murdoch‘s Sunday Times, which was in the process of setting up an Irish edition in the early ’90s – around the same time that The Sunday Tribune hit financial difficulty. The impending arrival of an Irish Sunday Times threatened to eat into the Sunday Independent’s readership and give Murdoch a foothold in the Irish broadsheet market for the first time. Had the Sunday Tribune been allowed to collapse it would have created a large gap in the market for Murdoch to exploit and so INM salvaged it and have since then used it as a buffer to try and stifle the Sunday Times’ growth.

But despite so much INM capital spent to secure the Sunday market via the Tribune, successive circulation figures suggest that the tactic has been a failure. At present the Tribune has a 5.6% share of the circulation market; The Sunday Times has long overtaken this and is currently at 8.5%. But despite this INM’s fears of losing much of its Sunday market seem to have gone unfounded and The Sunday Times has failed to get close to The Sunday Independent’s massive readership.

Combining its three other Sunday newspapers – The Sunday Independent, Sunday World and Star on Sunday – the company controls around half of country’s Sunday circulation. In fact The Star on Sunday, which was launched in 2003, is only 14,000 copies shy of the Tribune and the gap is quickly closing.

The fact that the Tribune seems to have failed in its supposed raison d’etre may explain why fresh rumours had been doing the rounds, claiming that INM was ready to cut the paper unless it started paying its way. With recent developments in INM it’s clear that at least one significant shareholder agrees with that approach to doing business.

Denis O’Brien has been building his interests in INM since January 2006 and with 8.36% of the company under his control he has made it clear that he plans to be anything but a silent partner.

In his recent assault on the INM board one of O’Brien’s main targets was INM’s ownership of The Independent in Britain, which has always been a loss-leader for the company since it invested in it in the 1990s. O’Brien wants INM to ditch what he sees as a vanity project and focus on its profitable operations instead – logic would dictate that he would also feel the same about their investment in the Tribune.

While O’Brien is unlikely to launch a takeover bid of the company any time soon his vocal nature is sure to draw sharp focus on some of INM’s operations. O’Brien could slowly chip away at shareholder confidence in Tony O’Reilly if he can show that his investments are not what’s best for the company. More importantly if INM believes a hostile takeover is on the way it will be forced to tighten its belt and get its house in order – expensive stragglers with no purpose will not be welcome under such circumstances.

But all is not lost for the Tribune; far from it. The reality is that while O’Brien is putting pressure on INM he’s not expected to make a serious move for the company any time soon, if ever. As long as INM itself is willing to continue financing the newspaper for another few years it still has plenty of time to get itself in shape and into profit.

At present The Sunday Independent is moving further and further away from news, The Sunday Business Post is focusing on business and economics and The Sunday Times is still held back by its amount of British content. For that matter there is a huge opening for up-market quality Irish news coverage with an investigative and agenda-setting slant.

Assuming the publication wants to target this niché, the only concern it will have is how much time it’s got to make the change.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>