2006 in journalism: advertising's hard times

0 Comments | Sunday Herald, The, Dec 31, 2006 | by STEVEN VASS, MEDIA CORRESPONDENT

MOST of the important things that happened in media in 2006 were linked to the horrendous advertising market and the digital future's coming of age.

Channel 3 companies SMG and ITV might have tottered on with dismal programmes and poor digital strategies for years, but they were both found out as the advertising pennies dried up.

ITV survived a private-equity-backed takeover bid by Greg Dyke in the spring, but when even the World Cup failed to lift the advertising gloom, the suits decided enough was enough. Chief executive Charles Allen was sent packing before the summer was out.

Over at SMG, Andrew Flanagan was ousted too, his come-uppance for years of racking up debts and doing deals at crazy prices. Former Channel 4 director Rob Woodward and former SRH chief executive Richard Findlay lobbied shareholders to take over, and it might have worked had the board not threatened a walk-out in response.

Instead SMG ended up in merger negotiations with Belfast's UTV, which ended when they couldn't agree on their values but restarted after an SMG profit warning hauled its share price further down.

ITV looked to be going the same way in November, when cable group NTL made a takeover offer and Five owner RTL prepared to do the same, but there were two big surprises in the pipeline.

Rupert Murdoch's BSkyB suddenly bought 18per cent of ITV and effectively took it off the market.

Then, when everyone thought former Ofcom boss Stephen Carter would become ITV chief executive, BBC chairman Michael Grade snatched the prize.

His defection, at the most sensitive stage in BBC licence-fee negotiations was a blow to director-general Mark Thompson, who had been having a good year.

Another 10-year Royal Charter had been secured; a restructuring had undone much of the production/broadcasting split imposed by John Birt in the 1990s; and Thompson had placed the BBC at the digital forefront with his Creative Futures plan even if he had annoyed commercial rivals in the process.

There was more bad news to come as it emerged just before Christmas that the annual licence-fee increase would be below inflation and the move to Salford would be forced through. This was such a thumbs down to Thompson's negotiating skills that he might conceivably have walked himself.

Meanwhile, BBC Scotland saw the shock resignation of news head Blair Jenkins in August in protest at endless cost-cutting. His replacement, Atholl Duncan, arrived before Christmas with a brief to keep BBC journalists in line.

If TV on demand and mobile TV got serious as technology improved, with Channel 4 and ITV for instance announcing on-demand programme plans, there were Damascene digital conversions in newsrooms everywhere.

Ad revenues and sales had been thumped for so long that the once- popular belief that you should not give stories away online for nothing vanished as even the Daily Mail "got" the net.

GUARDIAN Unlimited and Times Online kept on refining, but it was the newly named Telegraph Media Group that stole the limelight. It shifted its staff to new offices in London's Victoria to pioneer an integrated newsroom that now sees print and digital editorial decisions planned coherently throughout the day.

Will Lewis was made editor of the daily, having been elevated three times since he arrived as business editor from the Sunday Times the year before.

The Scotsman Publications had a bumpy year after Johnston Press took over from Telegraph owners, the Barclay brothers, in January. Out went managing director Steven Walker, replaced by Michael Johnston. Scotland on Sunday editor Iain Martin left next for an assistant editorship at the Telegraph group, and is now deputy editor of the Sunday title.

No such luck for John McGurk, the former Scotsman editor who pursued Martin to the same group soon after but was surplus by the autumn. Over 100 Scotsman staff were made redundant as backroom functions merged.

Both Johnston replacement editors were surprises. Scottish Sunday Times boss Les Snowdon got SoS over acting editor Tom Little, which led to Carlos Alba getting the Sunday Times Scotland.

But the real shock was The Scotsman, where Johnston opted for unknown Portsmouth News editor Mike Gilson over candidates who had worked in Scotland and at national papers. This seemed the ultimate cost-cutting move, but the paper has, at least, improved a little.

Together with Charles McGhee's installation as editor of The Herald in January, it put fresh blood at the top of both of Scotland's leading qualities.

Johnston Press had also been hotly tipped to buy the Aberdeen Journals titles from Associated Newspapers, but was unexpectedly beaten when DC Thomson swooped in with GBP132 million in March.

It was a testing year for the Daily Record, which was overtaken as top selling Scottish daily by the Scottish Sun in the summer after a long price war.

The 10p Sun switched Rob Dalton for David Dinsmore as Scottish editor to achieve this. Neither a voucher loyalty scheme nor the PM editions of the Record could stem the tide.