Tuesday, July 17, 2012

The Guardian and Observer report losses of £44.2m for last year; point to app development as contributing factor

While The Guardian's iPad app got lots of attention upon release, in the end it was no revolution in tablet publishing. But the Guardian Media Group is pointing to the development of its iPad. Facebook and Android apps as a contributing factor in reporting a loss of £44.2 million last year.

Despite reporting a 16.3 percent increase in digital revenues last year, losses grew for the British daily and Sunday papers. Last year the Guardian Media Group reported a loss of £31.1 million.

In the end, it was expenses that drove the increases losses. While revenue fell to £196.2 million from £198.2 million the year before, losses grew as the outfit launched a U.S. website and launched new apps.

As a result, Alan Rusbridger, editor-in-chief, said the newspapers would attempt to save £7 million through cuts in the editorial department, and would seek between 70 and 100 "journalist redundancies" - Brit talk for firing reporters.

What the Guardian Media Group needs instead is a P&L savvy publisher as a watch over operations. (Yes, I'm volunteering.)

Meanwhile, like many other titles, the Guardian and Observer are leaking print readers. In its earnings announcement the papers, which are owned by the Scott Trust, reported that Guardian circulation was down 10.7 percent to 211,511 copies a day from one year ago, while Observer circulation was down 10 percent to 243,946.