Last week, British newspaper The Guardian announced it plans to cut up to 180 jobs from both the editorial and commercial sides of the business. About 110 of those jobs will come from advertising, marketing, Guardian Jobs and live events. The remaining 70 will come from editorial. This represents about 12% of the newspaper’s staff. Like so many other media organizations, The Guardian has been negatively impacted by the pandemic. Demand for news is higher, but revenue has declined, making it harder to provide that information.
Editor-in-chief Katharine Viner and Guardian Media Group chief executive Annette Thomas made a joint statement to staff to share the somber news. The statement told staff that the pandemic has caused an uncertain and unstainable financial outlook for the media organization. Revenues are expected to be down by over £25 million, approximately $31.4 million U.S.
“We face unsustainable annual losses in future years unless we take decisive action,” said Thomas and Viner in an email to staff.
Other cost cutting measures include delaying across-the-board pay raises, furloughing 100 employees, and cutting marketing and travel expenses, reports The New York Times.
Keeping It Free
In spite of the dire news, Viner and Thomas said they want to keep The Guardian free to readers and not adopt a paywall as so many other news organizations have done. The Guardian gets its revenue from advertising and from reader contributions, including print and digital subscriptions. Digital subscriptions include access to The Guardian Daily, premium access to The Guardian Live app and provide readers with an ad-free experience at TheGuardian.com. In addition, The Guardian Weekly, a print, global, weekly magazine is available via subscription.
“Despite the pressures that coronavirus has placed on our business, our unique reader relationship model has proved successful, and the strategy of the past few years has been the right one,” Viner and Thomas said.
2019-20 Year End Financials
The Guardian also released its 2019-20 year-end financials for the period ended March 29, 2020. Highlights include:
- During the 2019-20 fiscal year, 1.5 billion unique visitors generated 16.4 billion page views, a company record and a 200% increase over the prior year.
- The newspaper has seen an increase in contributions and subscriptions. On March 29, The Guardian had more than 790,000 paying supporters plus 340,000 one-time contributions, bringing total paying readers over the 1 million mark.
- Group revenue decreased by 0.4%, but reader revenue helped offset declines in ad revenue and newsstand sales.
- Digital revenue represents 56% of total revenue.
- The Guardian had notable growth in the U.S., Australia and Europe.
“In common with many businesses in our sector and the wider economy, the COVID-19 crisis has had a significant impact on revenue projections for the 20/21 financial year. Our current revenue outlook for 20/21 indicates revenue declines across many parts of our business due to the impact of COVID-19 on the advertising market and wider economy, although we continue to expect growth in recurring reader revenues,” said The Guardian in its year-end financial report. “Given that the duration and severity of the pandemic and its economic effects remain unclear, the Group has implemented a range of cost saving measures across the business, and we continue to keep all aspects of our business under review.”
This is sad news for The Guardian and the journalism community. In recent years, The Guardian has been very successful engaging readers and sharing their value proposition, proving their value to convert readers into supporters. The increase in readership, reader contributions and subscriptions shows that their strategy has worked. It is a shame that the pandemic has slowed that progress and forced the elimination of so many positions. While 12% of an organization’s work force may not sound like a lot, 180 jobs does. That’s 180 people who will be out of work and who will not be able to help further The Guardian’s mission.