Wordblog

An intriguing detail in today’s Times story about the Lebedev purchase of the Standard is the involvement of Matthew Freud. This suggests a line of communication to the heart of News Corporation (Freud’s wife is Elisabeth Murdoch). Could it provide an escape from the inane, debilitating free-sheet war between thelondonpaper and London Lite?

A fresh start for the Standard may be the best thing that could happen to it. Like so many newspapers it was suffering from a declining circulation and the migration of advertising to online well before the recessions.

For newspapers as a whole this recession is much worse than those of the past. An already weak industry is faced not only with revenue reductions and fresh competition but the vulnerability that comes from floating on a raft of debt.

A year ago David Montgomery’s Mecom group was riding across northern Europe scooping up papers, financed by seemingly limitless credit. This week, after a temporary deal with banks to avoid breaking financial covenants, Mecom sold its German interests.

As Roy Greenslade said, “it should now just scrape through” but with shares down 94% on the year it looks very weak especially after yesterday’s resignation of the finance director and five non-executive directors.

Debts which have been strangling a lot of newspaper business for some time are looking more toxic than ever. The best future for many could be new, better financed owners.