The West chief a true believer

THE death of the newspaper has been greatly exaggerated.

At a time when the global media story of the day is about the closure of newspapers, the head of Western Australia's only local mass-market daily, WA Newspapers Holdings chief executive officer Chris Wharton, believes that hard copy papers have still got a major place in the market as they battle against the latest form of electronic rival - online news.

Mr Wharton took the helm soon after media magnate Kerry Stokes won his battle with the previous board of the publisher.

Returning to the newspaper business with a message of back-to-basics publishing, the former Channel Seven Perth chief disagrees hard copy news is in terminal decline.

That is especially the view emanating from the US, where online news is ahead of Australia and several well-known daily papers have either been shut down or are in trouble, a fact reported with glee by the growing voices in online media, which is seen as the principal reason for their demise.

Given American industry is often several years ahead of ours, the financial difficulties encountered there are viewed by many as the canary in the coal mine, especially for regional dailies such as The West Australian, which WAN publishes.

This year, The Boston Globe said it faced closure unless it could make annual savings of $20 million, while the owners of the Los Angeles Times, Chicago Tribune, and Philadelphia Inquirer have all declared bankruptcy.

"It is different in Australia," said Mr Wharton who believes newspapers in the US were too heavily concentrated.

"Look at us, one daily paper to service Western Australia."

Mr Wharton arrived at WAN from Channel Seven Perth, but before his television experience he headed Community Newspapers.

His installation followed a nearly-year-long battle by Seven and Mr Stokes to wrest control of the board. During that time, the Seven camp was highly critical of WAN's management and strategy.

In the past six months Mr Wharton has changed most of the senior management reporting to him, outsourced the internet platform, and made significant cutbacks through a big redundancy program.

Yet he denies he'll be revolutionising the business.

"I don't think I want to change it that much," Mr Wharton said.

"There are certainly some things that have to be changed but I don't want to throw the baby out with the bathwater.

"We have a company that prospered over a period of 176 years.

"I am doing things a different way in different times."

Among the many criticisms levelled at WAN is that it has been persistently slow on the uptake in the digital world.

In the late 1990s, its lack of online presence meant its share price was left for dead during the technology boom. While the subsequent crash returned the market's attention to traditional and profitable enterprises, a decade later WAN is again seen as being behind the times.

Mr Stokes, the chairman and major shareholder in Seven Network, which is WAN's biggest shareholder, took the question of The West's digital strategy up with gusto during his failed first attempt to spill the board a little over a year ago.

Since he prevailed late last year, many wonder what solutions he has.

In the digital space, Mr Wharton has cut its in-house IT development, shown the door to former IT chief Gavin Burnett, and hitched its content to Seven's internet joint venture Yahoo!7.

Its online presence in classifieds is limited, and it's understood the previous management's plan to extend this has been jettisoned.

To outside observers, this appears to be WAN living up to its Neolithic reputation, despite the 'under new management' sign hanging over the front door.

But Mr Wharton said he did have a unique strategy for WAN online, now headed by Nick Sertis, but was in no rush to commit the publisher until he thought the time was right, much as a previous regime under former managing director Denis Thompson did.

"You have to do it right," he said.

"Thommo, in a way, he was right.

"He said hang on, I'm not paying millions of dollars for I don't know what, it's like pinning jelly to the wall. Show me how to make a quid out of it, or sell me the Brooklyn Bridge.

"You have people like Rupert Murdoch saying you have to charge for it.

"He has been giving it away for 10 years, remember. It is unsustainable.

"I won't be stampeded by analysts or anyone into doing dumb, and you can quote me, dumb shit at their behest.

"It is easy from the cheap seats.

"We'll be doing the right thing by our shareholders."

Mr Wharton hasn't abandoned the internet, however, especially for classifieds where the major erosion of newspaper advertising is occurring.

"We have got a plan," he said.

"Just because we have not done that yet doesn't mean we don't have a plan.

"I am not sharing that plan with anybody just to appease some analyst temporarily; it is not going to happen."

Mr Wharton said focus was on the core issues of editorial, sales and circulation - with a strong customer focus underlying that.

Editorial has two new key managers with Brett McCarthy replacing Paul Armstrong as editor and Bob Cronin returning to the role of editor-in-chief, a position made redundant when he left nearly a decade ago to pursue other interests, including a recent role with the Stokes joint venture newspaper the Shanghai Daily.

Sales is now headed by David Bignold, who joined the company in January to run classified advertising and has since taken over from former general manager of sales Peter Stevens, who accepted a redundancy package recently.

Interestingly, circulation remains in the hands of Rob Billington. Circulation issues at The West were a primary point of attack by the Seven camp, which was critical of distribution delays that exacerbated friction with newsagents and home delivery franchisees.

The previous WAN management blamed teething troubles with the new presses for what it claimed was a short-term issue. The fact that management of this key area remains the same provides some evidence that this was the case.

Nevertheless, the distribution agents had started legal proceedings against the company and Mr Wharton believes the change in management at the top of the company has generated some goodwill and helped to bring the parties back to the negotiating table.

Mr Wharton is bullish about the prospects for circulation, which he claims is performing more positively than it has for 15 years. He attributes success in this area to old-fashioned newspaper rules.

"Firstly, get it to the printer on time, make sure the merchandise is in the shops, engage with newsagents," Mr Wharton said.

Without genuine growth in the newspaper business, Mr Wharton believes WAN will have a much harder time than in the past pushing through advertising rate increases.

"The West has gone out in the marketplace year upon year and said there is your rate increase for your advertising, like it or lump it," he said.

"They made more money because they printed less newspapers and charged more for it.

"At some point the marketplace says 'I have had a gutful' and that see-saw goes the other way.

"That is why that focus on the circulation is so important, because if we are going to command a rate increase, or even demand a rate increase, we better start showing our customers some increase in circulation to justify it."