A woman leaves the Fairfax Media headquarters in Sydney June 18, 2012.rnCredit: Reuters/Daniel Munoz
MELBOURNE - Australia's Fairfax Media, publisher of some of the country's leading newspapers, will slash almost one-fifth of its staff, as the country's media struggles with a massive shift online.
Fairfax - which publishes the 181-year-old Sydney Morning Herald, the country's oldest newspaper - said it will cut 1,900 jobs over three years from its staff of 10,000.
The company, which also publishes the Australian Financial Review and Melbourne's The Age, will shut two printing plants and reduce broadsheet newspapers to tabloid formats as it refocuses on online distribution.
Overhaul of its top mastheads is also in the pipeline.
Fairfax also said its options include a digital-only future if revenues continue to slide.
'All the world's newspaper companies are experimenting with what sustainability looks like,' said Dr Margaret Simons, the head of the University of Melbourne's Centre for Advanced Journalism.
'There is no business model that can support the hundreds of journalists who are employed by companies such as Fairfax,' she said.
The media industry's old guard is struggling with a massive shift online, declining advertising revenues for newspaper and TV, and shrinking market share for free-to-air TV as consumers' choices multiply for news and entertainment.
Trends in the United States point to even tougher times ahead, as the newspaper industry's efforts to boost digital revenue and cut costs fail to keep pace with declines in the print business, a Moody's report said this month, while online advertising sales growth is stalling.
Fairfax's classified advertisements were considered 'rivers of gold' as recently as a few years ago, but revenues collapsed as online websites took over markets for real estate, job and car ads.
Its announcement is expected to be followed shortly by news of restructuring at its larger rival News Ltd, the Rupert Murdoch- controlled News Corp's Australian unit.
News Ltd controls around 70 per cent of Australian newspapers, one of the most concentrated levels of media ownership in the world, compared with Fairfax's 30 per cent market share.
News Ltd is preparing to announce job cuts of up to 1,500 staff from its workforce of 8,000, according to a report yesterday on The Conversation, an independent website run by former The Age editor Andrew Jaspan.
The Australian, a News Ltd newspaper, said yesterday that executives would brief investors on the restructuring this week.
A spokesman for News Ltd declined to comment on job cuts.
Communications Minister Stephen Conroy said the job losses at Fairfax were disappointing but the restructuring was part of a trend around the world as publishers adapt to the Internet.
'The Internet will continue its march and sectors that were profitable previously are going to struggle as the Internet cannibalises different parts of the economy. It's not something that you can stop, it is not something you can turn back,' Mr Conroy told reporters. -Reuters