Guardian to cut costs by 20% over next three years
Guardian News & Media (GNM), publisher of the Guardian, is looking to cut costs by 20% over the next three years - shaving off more than £53 million from its current £268 million annualised cost base.
In plans outlined by GNM editor-in-chief Katharine Viner and Guardian Media Group (GMG) chief executive David Pemsel on Monday, the three-year strategy comes as the business looks to offset both declining print revenues and slower-than-expected growth in digital revenues, which no longer sustain its outgoings. Various reports also suggest that a number of jobs could be at risk.
Alongside ambitious cost reductions, which reflect a 23% increase in operating costs over the last five years while revenue growth has fallen to 10%, GNM has set out a number of editorial, commercial and membership goals in a bid to break even by 2018/19 - as well as looking for support from international growth in the US and Australia.
Pemsel said immediate action needed to be taken in order to 'safeguard' the long-term future of Guardian journalism.
"Against the backdrop of a volatile market, we are taking immediate action to boost revenues and reduce our cost-base in order to safeguard Guardian journalism in perpetuity," Pemsel said.
"This plan will ensure our business is increasingly adaptable and better able to respond quickly to the pace of change in the digital world."
guardian.com continues to perform well as the second most-popular news website, with the latest ABCs reporting more than 7.8 million unique daily browsers.
However, its print business has been in steady decline for some years, dropping -6.7% between December 2014 and December 2015.
During that time, print advertising fell by an estimated -25%, and as a result of otherwise healthy digital revenues unable to keep up with a fast decline in print, GNM operating losses for the year ending March 2016 are expected to be as high as £52 million.
Viner, who succeeded Alan Rusbridger in 2015, said that a much greater emphasis needs to be placed on the publisher's digital arm if its model is to remain sustainable.
"Over the next three years, a growing and far deeper set of relationships with our audience will result in a reimagining of our journalism, a sustainable business model and a newly-focused digital organisation that reflects our independence and our mission," she said.
GNM is owned by The Scott Trust, which was created in 1936 to secure the financial and editorial independence of the Guardian and safeguard journalistic freedoms. Unlike other publishers, it means GNM does not necessarily need to make a profit, using the Trust as safety mechanism to ensure survival.
Further details of the plan are to be set out in due course.