POLITICS

In defence of the New Age

Nazeem Howa's reply to the attacks by City Press and others

In my previous life I was chief operating officer at Independent Newspapers South Africa. I defended to the death the approach of the incumbent publishing houses to new entrants to the market and certainly believed in my heart that there was nothing wrong in our behaviour at that time and that indeed we were true to our word on transformation and diversification of the industry.

Boy, was I wrong.

Now that I am part of a team at The New Age trying to sustain a proudly South African and fiercely independent voice, I know just how tough it is to operate in the same markets as the incumbents. The New Age turned two in December and we all proudly wear the scars of survival.

The latest attack on us in City Press yesterday comes at a time when we are starting to enjoy the fruits of our first two years of publishing and turning our attention to other areas of the media which will lead to major organic growth for our small business. Our intentions are clear and public - we will be a major publishing force and we will challenge the incumbents in their negative approach to reporting on our new democracy. We know that the attacks on us will increase as the impact we make in the market grows.

We were and continue to be very surprised by the role of the DA in these attacks. Surely, if you wish to ask parliamentary questions on advertising spend from the government we should be asking it of all media, not only The New Age. I suppose DA MP Kenneth Mubu's comment of us being an "ANC gazette" speaks volumes about his narrow and sectoral interests. Interestingly, his leader, Helen Zille, will appear as our guest at the The New Age Business Briefing of January 31. This will be Ms Zille's second appearance.

We have also had Patricia de Lille as a guest. My challenge to the DA now is that they ask similar questions of government spend in all media and let's see if the media houses will use this information in the same manner.

Independent research house Media Tenor has commended the balanced approach of The New Age, as has the Freedom of Expression Institute.

In growing our business we will at all times remain ethical in everything we do and innovative in strategy to ensure we do not follow the incumbents who are facing seriously challenging times in both advertising revenue declines and circulation volume drops.

Our story is a wonderful David and Goliath parody. Our growth is markedly different to that of our competitors. Commercial revenues are up 26% year on year, while circulation revenues have shown growth of 12% for the same period.

The numbers suggested by City Press are so far from the truth as to make them laughable. The harsh reality is The New Age is today bigger in sold-for copies than most daily newspapers, totalling nearly 50000 copies. In addition, we provide a further 25000 free copies to our markets to ensure proper response to our advertisers.

An interesting incident which speaks to the state of the media industry was that I was asked to resign my position as a director of the Audit Bureau of Circulation when I resigned from Independent Newspapers. A question we must ask ourselves is why would an "independent body" require me to resign as one of its longest-serving directors simply because I left the employ one of the big four publishers.

Very few of our competitors can come close to matching our circulation growth and it must worry them that we are able to grow while they show a decline. It is our deep belief it is this that is driving their anti-competitive behaviour. For the record, our distribution is done at great cost to us by our competitors, so they have a good understanding of our numbers. Our printing is done by another competitor.

The harsh reality is that newspaper revenues have not grown over two years since our launch. That we are growing market share means that someone is losing it. And that is a powerful motivation for attacking a competitor.

Why are we growing in a declining market? In a word, innovation. Our models are totally different to anything you will find in operation in South Africa today. Hence the jealousy around our business briefings breakfasts.

The revenue model is a mixed one, including advertising, marketing and promotions for our clients using both the briefings and our newspaper to ensure we provide proper return on investment for them. It is a model that we thought of and sold to various business partners. First, our competitors approached the SABC to replace us as sponsors, now they have turned to bullying our sponsors to kill our venture by frightening them off with all kinds of political innuendo. It is interesting, too, that both City Press and the Sunday Times had a full page advertisement from Eskom yesterday - an advertisement which is not booked to appear in The New Age.

What City Press misses is that all major companies sponsor events. It is a normal part of their brand-building and marketing strategies. It is just that we were quick out of the blocks to secure this event ahead of any competitor. We will certainly not be deterred by their bullying actions and we are sure that our supporters will stand resolute.

It would be great if these same dominant players were to declare the size of the advertising support they receive from the companies they have highlighted as supporting us as a new entrant into the market. Our piece of the cake, I am sure, will be minuscule compared to what they are getting from the key advertisers, but I suppose to them it is about ensuring that new players do not even get the crumbs of the advertising cake.

Much is made of the relationship between our shareholders, the Gupta family, and the president and the supposed benefits we derive from this relationship. Since the dawn of time, business people and politicians have had close relationships. That was the case with the owners of City Press in the apartheid times and even through to the Mbeki presidency. Should we ask if there was anything untoward in those relationships as it can only be that which is guiding this misconception by journalists at City Press?

On our side, we have constantly challenged the media to show us one example of any undue advantage we have derived from the relationship between President Jacob Zuma and our shareholder. Incidentally, that relationship predates by far the president's elevation to the Union Buildings and endured his tough times when he was relieved of the deputy presidency of the country and cast into the wilderness. It has never been a friendship of convenience, rather one building on a genuine closeness built on a shared vision for the betterment of South Africa and all who live here.

A consequence of pushing the line of a "cosy relationship" is also an anti-transformation agenda as it presumes that the executives at any of the entities with which The New Age has commercial relationships are unable to think for themselves and unable to negotiate to best advantage. It also presumes that the boards of directors are not performing their fiduciary responsibilities. And that The New Age has no leadership capable of forging relationships which result in opportunities for The New Age.

I know the media industry is keen to manage its own transformation and has set up a task force to do so. However, on current form I am not sure we can expect the poachers to mind the rhinos.

Perhaps it is time for a true reflection on the state of our industry, the rules and behaviour governing competition with new entrants. The alternative is that the same voices will continue to dominate the current discourse. All The New Age wishes to do is to provide an alternative voice to focus on a balanced outlook on what is really happening in our country. The business briefing breakfasts form part of that strategy of providing those in power the platform to report on their activities and to provide the electorate an opportunity to put challenging questions to those in power. As media, one would have thought the initiative would receive an all-round welcome as a genuine initiative to deepen democracy and accountability.

Unfortunately, competitors have allowed jealousy to get the better of them and placed their own selfish interests ahead of those of the nation.

Nazeem Howa is chief executive of The New Age. He has spent 30 years working in the industry, including stints at Independent and Times Media.

This article first appeared in The New Age, January 21 2013

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