Bailey tells government consolidation essential in local newspaper sector

by John Reynolds, mediaweek.co.uk 16-Jun-09, 15:25

LONDON - Consolidation is essential in the local newspaper sector and "is not a silver bullet", Trinity Mirror chief Sly Bailey said today.

Speaking to a House of Commons Culture, Media and Sport Select Committee, The Future for Local and Regional Media, Bailey repeated her criticism of regulatory constraints on newspaper companies.

She said: "The industry needs to see consolidation. This is not a silver bullet, but more scale will give us more opportunity."

Meanwhile, half of the country's estimated 1,300 local and regional newspapers could close within the next five years, according to Claire Enders, founder and chief executive of Enders Analysis.

Enders said: "A lot of titles are being sustained by the good grace of the owners. We are looking at a fundamental shift in the economy and we are not going to come back."

She added that small circulation titles "were most at risk" of closure, but when questioned denied local newspaper owners should have better prepared themselves for the recession.

Guardian Media Group chief executive Carolyn McCall said an ad market recovery is unlikely in classified advertising, citing the strong competition across the property and car categories, adding that "deregulation will help, but it is not a panacea".

McCall added that changes to local media regulation would mean a stronger regional industry, adding "what is better? To have one strong title competing rather than two anaemic titles".

The long-running row between local commercial media and the BBC was also reignited, with McCall saying the Corporation should not be allowed to carry out what she perceives as its encroachment on local news.

She added: "The BBC is a global colossus. It does not do local well."