News Limited followed its rival, announcing a significant restructure of its own business with the slashing of 19 divisions to five and the cutting of an as-yet unknown number of jobs, and then surprised the market with a $2 billion bid for the James Packer-controlled Consolidated Media which owns half of Fox Sports Australia and 25 percent of the Foxtel cable television network.
The bid for Consolidated Media by News Corporation, which is incorporated in the United States, is subject to regulatory approval from Australia’s Foreign Investment Review Board and the Australian Competition and Consumer Commission (ACCC).
If approved, the bid would increase News Limited’s stake in Foxtel to 50 percent and give it full ownership of Fox Sports Australia.
In further consolidation of its move online, News Limited also confirmed the acquisition, reportedly for around $30 million, of the business websites, Business Spectator and The Eureka Report, from former Fairfax journalist and ABC presenter, Alan Kohler. News’ expansion of its digital business includes a $60 million investment in a new computer system to facilitate news delivery across the different platforms.
Both Fairfax and News have suffered from a reduction in print advertising and a drop-off in subscription revenues and circulation as readers – particularly the digital-savvy younger generations – increasingly get their news from the Internet.
News Limited, however, has said it is still committed to its print newspapers at the same time as expanding and growing its online media business, with news delivery through tablets, the Internet, smartphones, social and broadcast media.
Fairfax, on the other hand, while expanding its digital business has given no commitment to print and, indeed, indicated that if the print newspapers in the tabloid format don’t become profitable, they may well be closed.