Fairfax chief executive Greg Hywood has reiterated the media company would move to a digital-only model in the future but only if the print business becomes unprofitable.
At the Fairfax Annual General Meeting this morning, Hywood emphasised the company's strength in digital. He conceded Fairfax and the media industry continue to face challenges as a result of a difficult market conditions but the management board has plans in place to deal with them.
He said: “Your board and management are clearly and decisively preparing for the time – which may be in three years or 15 years – when print publications in the Metro business can become unprofitable and we move to a digital-only model. We are taking the necessary steps now and will in the future take further action if required. We will manage the business in the world of reality and not sentimentality.
“But while there is cash flow to be generated from print, we will still be there.”
Hywood said while there is less revenue in digital, there is also less costs and therefore a higher profit margin. He added the Metro business will not be subsidised by any other Fairfax business.
He added: “We can deliver this transformation because Fairfax Media is ahead of our Australian competitors and ahead of most traditionally based media companies in the world, and has built a massive – quality – online and digital audience. It is this audience that will secure the Metro's success in whatever mix of digital and print platforms we have in the future."
He said the future of media will be predominantly digital.
Hywood told the meeting revenues for September and early October has seen a slight improvement on August. In August, revenues were down 10% year-on-year, whereas in September and October, it was down 7.5% on the previous corresponding period.
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