Fairfax and News Have One Similarity - Going down together

Fairfax chief executive officer David Kirk has one characteristic of the journalists he rules over: he is happy enough for his papers to hand it out but thin skinned when it comes to taking it. I'm not sure what it is that makes those in the media quite so hypocritical on this matter of criticism but it is something I have noticed many times during my 49 years in the profession. David Kirk might himself be a bean counter rather than a journalist but his speech to the Sydney Institute showed him very touchy indeed about having his work questioned.
Singled out for a special display of petulance was Eric Beecher, a former editor of the Fairfax owned Sydney Morning Herald and the current proprietor of a range of news websites including Crikey for which I regularly write.

But I must say it is galling to have to listen to the self-appointed experts prattle from the sidelines. Some people think we should give up the fight. Eric Beecher has been a poisonous critic of our company, for reasons best known to him. He was asked about our future on Lateline in August, and this is what he said:

VIRGINIA TRIOLI: Eric Beecher, what would you do with Fairfax if you got your hands on it tomorrow?
ERIC BEECHER: Well, the first option would be to sell it or break it up and sell it.
That's what I would do.
VIRGINIA TRIOLI: You wouldn't bother with trying to stick with this behemoth?
ERIC BEECHER: Well, the problem is, if you owned 100 per cent of it and there wasn't a share market to deal with, yeah, you could do lots of things with it. You could actually say, as the New York Times does and to some extent the Washington Post, the journalism is the centre of the fabric of what we do and that comes first and we'll deal with the profits separately in some way, but whilst you've got a share register which is just open like there's, no I don't think there's anything you can do.

So there you go, a self-proclaimed champion of the cause of quality journalism in Australia, and publisher of that quality online site, Crikey, telling us to roll over and die. We won’t be throwing in the towel.

CEO Kirk was keen to elaborate on this theme mentioned by Beecher of the restraints imposed on quality journalism by the public company structure of Fairfax without the benefit of a capital structure that separates voting shares from ordinary shares (which is the type of structure in place for The New York Times, the Washington Post and News Corporation, among others). He said at one point:

"Some critics of Fairfax Media point to News Corporation as an example of what should be done to continue to promote quality journalism. I am an admirer of Mr Murdoch and News for all their achievements. But it is critical to recognise that News Corp’s publishing business, because of its corporate structure, scale and voting stock, is simply not subject to the same market requirements for performance as is Fairfax Media."

What Mr Kirk did not refer to is the very similar treatment that the stock market has given to the two media companies despite their different structures. The graph at the top shows the relative performances over the past two years.