Executive Editor of Business Report.
Executive Editor of Business Report.

Covid-19 last straw for some media in SA

By Adri Senekal de Wet Time of article published May 7, 2020

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CAPE TOWN - That the media landscape has changed over the past few years is one thing. The change we have seen in the past few weeks is another, entirely.

Change in this aeons-old industry started with the introduction of digital platforms and social media, then a steady decline in advertising revenue, circulation, along with a slew of new digital-first publications.

Lasting and permanent change has now been forced by lockdowns brought on by Covid-19, with many media houses across the world, and here in South Africa, facing demise.

Venerable publishing groups and titles across the country have announced some form of aggravated difficulty in running their businesses over this time.

Last week, Associated Media Publishing (AMP), one of South Africa’s most well-known independent media houses, announced that the company will be closing up shop, permanently. AMP chief executive Julia Raphaely shared the news that the company, which was launched 38 years ago, would cease trading and publishing its magazines, including Cosmopolitan, House & Leisure and Women on Wheels, from May 1.

Joining their ranks this week, it is the turn of Caxton and CTP Publishers & Printers, who on Tuesday said it had decided, in principle, to close its magazine division.

This affects at least 10 magazines, many of which are household names in South Africa that have been in circulation for decades.

According to a statement issued by the company, the board said it had begun withdrawing from magazine publishing and associated businesses. The titles affected are Bona, Country Life, Essentials, Food & Home, Garden & Home, People, Rooi Rose, Vrouekeur, Woman & Home and Your Family.

The board said the steady and continuous reduction in advertising spend in the magazine sector, as well as the decline in circulation revenues, had over a number of years significantly reduced the viability of the magazine business.

“Further, the negative impact of the recent Covid-19 lockdown on general economic activity and, as a consequence, on the ability of the business to trade normally in what were already difficult trading conditions for magazine publishers, has made this decision unavoidable”.

Hindsight being the perfect science it is, the writing was already on the wall when the Tiso Blackstar Group (now Arena Holdings), announced on May 15, 2019 that its tabloid newspaper, Sunday World, would be shutting down.

“The group will also embark on retrenchments across a range of its publications including the Sowetan, The Herald and the Daily Dispatch,” they warned last year.

The South African National Editors’ Forum (Sanef) said at the time that it was “disturbed about the closure of these publications”.

Sanef chairperson Mahlatse Mahlase said then that it was an indication that there was a bigger crisis in the media industry.

“We are quite concerned because this has been the trend in the past couple of years, where we saw the closure of the Huffington Post and we also saw the closure of another Tiso publication (now Arena Holdings), The Times.

“But we also know that in-between there’s also been retrenchments at other companies: Media 24, the Independent Newspaper Group, and that is quite concerning, because it has an impact on the quality of news that we are able to continue to pursue.”

Several media houses have announced plans to cut salaries by up to 40percent, Independent Media (Indy) included, and some have stopped commissioning the services of freelance journalists.

Many freelancers have lost out on 100percent of their income, because their work is often ad hoc rather than contractual, and they have been turned down for government relief funding.

The Current

Economist Mike Schussler said advertising ties the media industry to the rest of the South African economy and the impact of the national lockdown would certainly be felt by media houses going forward, if it had not been felt already.

“Media are going to be affected by what’s happening in the economy. If businesses close, they lose money. If they lose money, they don’t have enough money to spend on things like advertising,” said Schussler.

Professor of economics at the University of Stellenbosch and Media24 director Rachel Jafta said the closure of Associated Media was a wholly negative development for mainstream media in South Africa, at a time when the industry had already been struggling for years.

For at least a decade, media houses have faced numerous challenges. The rise of the internet and social media platforms resulted in something of an information overload for many consumers, sometimes at the expense of credible news agencies.

Major media houses in South Africa, including Naspers, Indy and Arena Holdings changed their business models to monetise online news. However, the immediate impact of the digital age for print media was on their advertising revenue.

As fast as media houses could adapt, tech giants like Facebook and Google began eating into advertising revenue that was meant to be the saviour of newsrooms migrating from print to a digital platform.

Then, in March, along with the worst global pandemic since before the Great Depression, media houses took a final, devastating hit to their revenue streams.

Lockdown measures across the globe in general, and in South Africa in particular, brought entire industries to a halt, sparking crippling declines in ad sales and preventing the hosting of events that would otherwise bring in life-saving income.

The Glasshouse

No opinion on the state of the media in South Africa would be complete without the mention of Indy’s chairman, Dr Iqbal Survé - and no, this is not in my guise as the so-called chief cheerleader. This is about fact.

Days ahead of the national lockdown activation announced by President Cyril Ramaphosa, Dr Survé called for a meeting of the national editors at the Indy.

He warned us - from his perspective as a medical doctor, a member of the board of trustees of the Global Influenza Surveillance Initiative, and as a businessman - that this pandemic would change the world as we knew it forever.

This was not doom saying, but cold hard rational logic. He told us then that we would inevitably be faced with salary cuts, and urged us to make the necessary preparations and arrangements with our banks and landlords, and inform our team members to do likewise.

Indy’s communications department responsibly issued employees with letters of support that went viral. This was an aphrodisiac to the hungry horde of Dr Survé detractors who (prematurely) dined out on Independent’s situation.

The Daily Maverick, one of a new breed of digital publishing interlopers (who incidentally needed bailing out several times till it had refined its business model), couldn’t wait to publish our internal communiqué on its website.

Disgruntled ex-employees of Indy too, seized the opportunity to feast, posting fake, false and skewed tweets about proposed salary cuts at Indy.

What do they have to say now They have become strangely silent

While many organisations have been forced to close and with more job losses and closures looming, at the Indy no such decision has been made. Instead, the much-maligned chairman has chosen to keep people employed. To do so, a variety of measures have been put in place, including salary cuts. This is not the first time Dr Survé has put the people at the Indy first, as I have previously written.

The Future

A new era dawns in the media and it is up to us who are left to shape it. This is an opportunity to cease what has hitherto been a truly ridiculous and unnecessary media war among the various houses.

Instead, we should become ambassadors for the country we love, work together, not against each other, so that collectively we can ensure that an independent news and media sector can not only survive, but thrive on the tenets of respect for one another, the truth and freedom of speech.

The consequences of not doing so are too dark to contemplate.

Adri Senekal de Wet is the executive editor of Business Report. 

BUSINESS REPORT 

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