THE WAR OF ATTRITION
The press:
Paul Johnson predicts eventual
victory for Maxwell
YOU can read what you like into the settlement Robert Maxwell reached with the NGA on Sunday. To me it looks more like a temporary truce than a peace treaty. By getting the union's agreement to take away the printing of Sporting Life from the high-cost Holborn Circus plant to the lower-cost plant in Bermondsey, Maxwell can be said to have won the point which ostensibly gave rise to the dispute. On the other hand, since he plans to sell Sporting Life anyway (it has been losing the Mirror Group three million pounds a year) the NGA concession can be presented as a face-saver to a Maxwell who suddenly found himself over-extended, having adv- anced an ultimatum too far. Maxwell is an exceptionally determined fellow who, if you look at his record, nearly always gets what he wants in the end. But he is an intuitive operator, a man of sudden im- pulse and equally sudden retraction. Last week's crisis was probably a probing opera- tion on his side, to test the reactions and weaknesses of his enemies and the strength of his own position.
Maxwell's difficulties spring from the fact that a newspaper proprietor who stops operating in his existing plants starts to lose money, in cover price and advertising receipts, from the first lost issue, while the saving of costs accrues much more slowly, since he has to issue protective notices of dismissal to workers not directly involved in the dispute. He can't just stop paying them all instantly. So he is caught in a squeeze. Maxwell is reputed to have got a £100-million line of credit from US banks, and the promise of £300,000 a week from other members of the Newspaper Pub- lishers' Association for fighting their bat- tles. That would help, of course. But he also has to take into account the damage to his assets. He lost nine complete issues of the Mirror plus a couple of issues of his two Sundays. This comes at a particularly bad time for all three papers. The latest National Readership Survey, which lists total readership, as opposed to the figures of copies sold per issue compiled by the Audit Bureau of Circulation, produces totals for January-June 1985 which do not reflect too badly on Mirror Group News- papers. According to this, all the dailies, except the Times, lost readers compared with the first half of 1984, but the Mirror's loss of 132,400 or 1.3 per cent was very much lower than the Sun's of 563,000 or 4.5 per cent. The Sunday Mirror actually put on 3.5 per cent or a total of 355,750 new readers. However, the really remark- able figure revealed by this survey was the 1,424,300 new readers for the TVIGN's most dangerous rival, the News of the World, representing a gain over 1984 or 12.3 per cent. The week before the Sunday Mirror and the People failed to appear, the News of the World passed the five-million barrier for the first time since 1977, and the first week the two MGN papers were out it printed 6.25 million copies and sold them all. Presumably it did even better last Sunday. Now that the NoW is a tabloid, and with a colour supplement to boot, it stands a strong chance of keeping a large slice of these sales. There is something anomalous about the. Mirror Group pub- lishing two Sundays anyway — though their publishing histories are very different and so were their editorial characters, at least until quite recently. A long absence might have driven Maxwell to the drastic step of amalgamating the Sunday Mirror and People, which he may still have to do.
Again, losing nine issues of the Mirror brought joy to the Sun, which was enjoying a strong summer showing anyway, printing many more copies in August than in July, against the seasonal trend. The magazine Progessive Newsagent reported that, in the absence of the Mirror, 72.5 per cent of the readers would go to the Sun, 22,5 per cent to the Star and five per cent to the Express. This, of course, is on the assumption that copies were available. So much for the left-wing loyalties of readers of the Mirror, Labour's most faithful newspaper! We must assume, then, that the Sun has been the great gainer during the Mirror's abs- ence, and many of these readers, too, may not go back. When Maxwell bought the Mirror Group he promised the daily would overtake the Sun within a year or two. That now looks impossible. The danger, rather, is that the Sun will establish the kind of commanding lead the NoW has achieved in the Sunday field. Every day the Mirror failed to appear made this prospect more likely, and that must have been a factor pushing Maxwell towards a settle- ment.
Maxwell might have been in a much stronger bargaining position if he had managed to get copies of his papers printed in Manchester. He hoped to exploit the conflict of interest between the Manchester NGA men and their London brethren. But after some pressure from the national leadership, the Mancunians decided to put union loyalty first, and that closed off Maxwell's best option. By the end of last week he had already forfeited about eight million pounds in lost revenue, with no immediate prospect of getting his papers on the streets by alternative methods. He is the biggest owner of printing presses in Britain but he does not possess any im- mediately available and capable of printing a normal Mirror. An Eddy Shah-type operation is theoretically possible but would have taken a lot of time to get going. The new technology is indeed miraculous by Fleet Street's old hot-metal standards, but the miracle does not just happen: it takes many weary months to bring about, as Brian MacArthur and his editorial team at the new Shah paper are discovering. Hence Maxwell's threat to close down at High Holborn was as drastic as it sounded, and if carried out would have meant the disappearance of his titles for a long time. There are some who say that Maxwell has in reserve the ultimate deterrent of break- ing up Mirror Group Newspapers and realising its assets. It is true that, if you tot up the value of its various properties, you come to a theoretical sum not far short of what he actually had to pay for the Group. But such a move would be highly distaste- ful to Maxwell, who has a well-deserved reputation for turning round ailing or loss-making firms, wants to enhance it by a big success at MGN, and above all loves the power and glamour of being a news- paper baron. To scuttle is not his way. Nor is it his nature to accept defeat or even stalemate.
For all these reasons, I expect last week's costly offensive, which had a world war one flavour about it, will turn out to be merely the first phase in a long war of attrition Maxwell will wage against the entrenched union interests at MGN. He has sustained some casualties. But I still back him to win.
Previous page
