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Guardian braced for job cuts after burning through £70m in cash

16 January 2016

From The Financial Times:

The Guardian newspaper is braced for significant job losses after it burnt through more than £70m in cash last year, according to people familiar with its performance.

The left-leaning publisher, which runs one of the world’s most popular news websites, is preparing to embrace austerity as it cuts costs across the business.

It follows a year of torrid trading — marked by a sharp fall in print advertising sales, a rise in online adblocking, and a difficulty in making money from mobile devices.

. . . .

Rasmus Nielsen, director of research at Oxford’s Reuters Institute, said the Guardian was “taking a big bet” by investing in building an online audience.

“It’s been thinking more like a Silicon Valley start-up than a player in a sunset industry facing decline,” he said. “It needs to cut costs and increase revenues.”

. . . .

The Guardian has been lossmaking for more than a decade, but is nonetheless among the most financially secure publishers on Fleet Street. Its parent company, Guardian Media Group, has an investment fund of more than £800m, mainly compiled through the sale of its car classifieds business Auto Trader. That fund would need to make an annual return of 9 per cent in order to sustain the Guardian’s current cash outflow indefinitely.

. . . .

“What people expect from the Guardian is different from what people expect from BuzzFeed,” said Mr Nielsen of the Reuters Institute. “The risks if you get it wrong are much bigger.”

Link to the rest at The Financial Times (if you hit a paywall, do a Google search for the title of the article) and thanks to Barb for the tip.

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15 Comments to “Guardian braced for job cuts after burning through £70m in cash”

  1. Man it is tough dredging up sympathy for a newspaper as biased (mostly high quality bias, but bias nonetheless) as the Guardian. I’m trying though.

  2. Political bias notwithstanding (every newspaper has that one way or another),The Guardian has a feature that keeps me coming back to it again and again. It does better coverage of breaking news than any other source I’ve found. For a big, breaking story, the Guardian uses a rolling news feed with coverage from its own correspondents but also from the social media feeds of journalists, local residents, etc. The Telegraph, New York Times and a few other papers have tried this but fall way short of the Guardian. The coverage is curated in the best sense–without the political bias that shows in the rest of the paper but also without the noise of the raw social media feed. This feature plays especially well on mobile. If The Guardian finds a way to expand it, I think they’ll have an advantage over most of the dead-tree dinosaurs flailing around in the ever-advancing tar pits.

  3. Commenting so me can get emailed the comments …

  4. “The risks if you get it wrong are much bigger.”

    *Gigglesnort* The Grauniad? Get something wrong? Heaven forfend! What I expect from them is certainly different–I expect them to get pretty much everything, including their own name, wrong.

  5. “What people expect from the Guardian is different from what people expect from BuzzFeed,”


    I’m mostly left-leaning, which in American terms is roughly equivalent to full-blooded red Communist.

    I had the paper delivered for years and I would often take it to work, where it got me as much abuse as anything I ever did or said. A UK police station is not a place to wave The Guardian, or it wasn’t back then.

    I think it is a real shame that journalism is falling off the world. Celebrity obsessions are not news. I recall the great days of the Sunday Times insight teams who would work for months on great stories. Too expensive now.


    • Couldn’t agree more. The Guardian ran the Edward Snowden revelations when other papers shied away. It’s almost impossible to find a credible source of breaking or current news any more–and there is little to no investigative journalism being done. Illiteracy, aliteracy and oligarchy are not much consolation for our loss of participation and (at least the illusion of) democracy and a robust free press. A dystopia plagued by endless reports of Kardashian sightings, crude political swaggering and unfiltered spin is pretty useless and increasingly difficult to navigate, whether your leanings are left or right.

      • The press has never been freer. The internet demonstrates that. Want to participate? Go for it.

        Don’t like Kardashians? Don’t read about them. It works. My wife gave me a look of total disgust yesterday when I asked, “Who’s David Bowie?”

    • youre right Brendan, MHayes. Investigative reporting on whomever occupies vast power is the column of so-called ‘the fourth estate.’ When rich guys buy up newspapers and sports teams, they arent seemingly interested in upholding the reason for being in ‘the public’s right to know.’ Many suggest “blogs’ can replace newspapers. Not really. The costs of investigative reporting in time and money, even in one’s own hometown, are often massively– past the obvious and superficial– outside most blogger’s reach.

      THere are some like Snowdon, Manning, Penn who we call in my circle, citizen whistleblowers, not just on arrogant persons who really dont give a s about anyone except their own opinings, but on the MSM itself. That may be the future. There are exceptions. HUGE risks taken by B.Globe on stripping Cardinal Law of his pomp and hiding of pedophile priests over protection of children, over MASSIVE reports to him of sexual intrusion on children by priests. Without the massive amounts of money and time and real risk for the journos and their families going up against a huge institution, a hugely MONIED institution, is exactly the heart of investigative reporting. That the BGlobe couldnt be bought off, many of the reporters Catholic, in a town powered by many Catholics and the church for eons, was really quite something to watch unfold over the year[s]. Brave people.

      That would be an example of where the bar ought be set imo. Currently, it would be, among others, Flint. Much filth to be uncovered there by whomever has the money and time and a heart for it, and will broadcast the facts far and wide.

  6. Gotta wonder how much of that money burn goes to C-Suite Perks, Boni, and Golden Parachutes. Too bad for all the worker bees… 🙁

  7. I don’t know about the US, but over here a hallmark of the left is an inability to balance the books.

    • Why do we need the books balanced? Surely it’s more important to increase the size of the state (because the state is fairness).

      Sorry, just tried and failed to read Corbyn’s speech to the Fabians.

      • I live in Islington North, so Jeremy Corbyn is my Member of Parliament, and has been for decades. Every five years I go and vote for someone else, and he gets in again.


  8. Obviously, the Guardian and its pundits know best how to run an economy. Their model should be expanded to include the UK in its entirety, then the EU, and then the globe.

  9. If it was just the Guardian, that would be concerning, but not terrible. But it seems like all the decent news sources are drying up.

  10. I wonder how one burns though ’70M” in cash. Why cash, you mean someone delivered in small bills, suitcases full of cash? Nah, that cant be right.

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