In Sydney it'll be the Sydney Morning Herald and 2UE, in Melbourne it'll be The Age and 3AW. Not bad real estate. Here's how I explained the thinking in the Canberra Times:.
Australia’s quality capital city broadsheets - the Age, the Sydney Morning Herald and the Canberra Times - abandoned radio some 20 years ago.
The Fairfax newspaper group was forced to sell their iconic radio sisters 3AW, 2GB and 2CA in order to keep the company afloat.
An ill-thought-out takeover bid by the 27-year old Harvard-educated family heir Warwick Fairfax had pushed it to the brink of insolvency.
Along the way it also ditched its TV stations and the Canberra Times itself.
Until this year media laws introduced by the Hawke-Keating Labor government in the 1980’s prevented it from buying radio or TV stations back...
Keating famously declared that media proprietors could “become princes of print or princes of television, they cannot be both.”
Fairfax is the first media company to attempt to own both an electronic media outlet and a newspaper in a city since Helen Coonan and John Howard made it legal again this April.
It needs to because the “rivers of gold” that it was long believed would sustain the Age and the Herald are drying up.
The internet has turned the company’s near total reliance on classified advertising for jobs, cars and real estate each Saturday from an asset into a liability.
In order to continue to publish its quality capital city newspapers it needs to reduce its reliance on revenue from them.
Its aim has been to get their contribution to its revenue down below 50 per cent.
Figures prepared by a stockbroker yesterday suggest that its move back into radio, buying back premier talk stations in Sydney and Melbourne (but not this time in Canberra) will achieve that.
Along with its earlier merger with Rural Press, owner of the Canberra Times, it may have reduced the importance of its revenue from the Age, Sydney Morning Herald, Sun Herald and Financial review from 64 per cent to 38 per cent.
Those papers are more likely to survive.