Our response to News Corp Industry announcement

News Corp Australia

News Corp has released their long overdue review here in all regions except for Tasmania, Alice Springs, Cairns and Townsville which we are still waiting on.

An FAQ explaining many of the points is here.

The most important detail we see is that they are offering a three-year contract. This is something we have been saying the industry needs since the failed T2020. The effect of T2020 has been that many buyers have been reluctant to move because of uncertainty in the industry. As such prices of newsagencies have fallen much more than they should have, Not only that but this announcement gives banks and finance companies more security in lending money to newsagencies. This contract gives certainty.

The other point we liked was the margins will remain the same and in fact, slightly better. A drop in margin would have hurt the industry, way beyond the financial.

Overall we see it as a good plus.