Investor Buffett spends $142 on newspapers

Billionaire investor Warren Buffett is spending $142m on 63 US newspapers, according to a report in the Financial Times from Andrew Edgecliffe-Johnson and Dan McCrum on 17 May, 2012. The deal should guarantee rapid returns, according to the FT.

Buffet - a former paper boy himself - invested $200m on the publisher of the Omaha World Herald, his local newspaper, six months ago. Now his investment company, Berkshire Hathaway, is buying most of the titles of Media General, based in Virginia.

The group includes 18 television stations and the titles ranging from the Richmond Times-Dispatch, with an average of 164,000 Sunday readers in 2011, to The Culpeper Star-Exponent, with just 6,000. Its websites had 12.6m monthly unique visitors in 2011 and it is moving towards a subscription model with seven sites already charging for some content online and another 11 currently rolling out paywalls.  The group is expected to earn $30m before interest, tax depreciation and amortisation in 2012.

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One in ten in UK would pay for online content

A new report from market researchers, the Internet Advertising Bureau UK (IAB) and ValueClick, suggests that only a small minority of UK consumers - one in ten - would be prepared to pay for online content. By contrast, over half the respondents among the 2,000 people surveyed were happy viewing online ads in return for access to free content.

Some mainstream titles, such as the Financial Times and the Wall Street Journal, have successfully put content behind paywalls, but it is no coincidence that these are both financial titles. The Times’ traffic plunged 59 per cent after it introduced a paywall in 2011, and general online publications, including the leading UK online titles - the Daily Mail and the Guardian - have opted for ad financing with their web editions (although iPad and Android editions are generally paid for). The Mail has become the world's most popular online newspaper with 45.3m visitors in December 2011, according to comScore. The Guardian heads the quality titles.

Ad-supported content appears to be widely successful, but it does not translate into increased revenues. Recent US figures from the Newspaper Association of America claim that newspaper digital ad growth actually slowed in the US in 2011, growing only 6.8 per cent for the full year compared with 10.9 per cent in 2010.

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New evidence in the US anti-trust case against Apple, Macmillan and Penguin

Thirty-one US states have now joined the US Department of Justice class-action against Apple and a number of leading publishers over e-book pricing. The release of an amended complaint has included some previously redacted evidence, including an illuminating e-mail from Steve Jobs about e-book pricing.

The case hinges around Apple's attempts to introduce the 'agency model' of publishing for e-books in which publishers, not retailers like Amazon, set book prices. Five publishers were originally included in the action, but three have since negotiated a settlement with the DoJ. Macmillan and Penguin have not. 

In a report from the PaidContent website, which broke the story of the Jobs e-mail, Laura Hazard Owen says that the e-mail was written 'to an executive at the parent company' of one publisher who was hesitant about signing with Apple. It seems to support the DoJ's contention of price fixing.

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Hedge fund wins as Yahoo!'s CEO loses own job

New York hedge fund, Third Point LLC, which owns 5.8% of Yahoo!, will get three out of the four seats on the Yahoo! board it has been seeking, as part of a deal which has seen chief executive Scott Thompson lose his job. Ironically, a few weeks ago Thompson launched a major redundancy programme which will see 2,000 Yahoo! employees lose their jobs.

Following investigations by Third Point, it was revealed in early May 2012 that Thompson's résumé inaccurately claimed an academic qualification in accountancy and computing - his qualification had, in fact, been in accountancy only.

Yahoo! said in a statement that its global media head, Ross Levinsohn, will become interim CEO - the fourth person to hold the position in the past year.

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Oracle wins half the war with Google

A half-and-half verdict in a court case in San Francisco last week leaves Oracle unsure of what to do next and Google rolling up its sleeves for a second round in this important copyright battle.

Oracle had sought a clear decision that the search giant had breached its copyright in writing an application programming interface (API) for the smartphone operating system, Android, that looked a lot like Java, the language developed by Sun and now owned by the database company.

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US Newspaper Circulations on the Rise

Good news from the Audit Bureau of Circulations in the US for those concerned about the fate of newspapers. Helped by recent rule changes that allow US newspaper publishers to include paywalled web editions, tablet editions, e-reader editions and so on, US newspaper circulation has increased in the last six months, according to latest figures posted on 1 May 2012, in some cases dramatically. These are the first year-on-year figures under the new rules. Here's the story:

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UK court rules Pirate Bay must be blocked, BT still considering its position

The High Court in London has ruled that five of the UK's largest internet service providers (ISPs) must block access to the Pirate Bay website, which is based in Sweden and is still subject to ongoing legal action in that country, for offences relating to breach of copyright. The blocking orders were made on 30 April,  by Justice Arnold after he had ruled in February that both the operators and the users of the Pirate Bay were responsible for copyright infringement.

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The information economy exposed

A recent story by Anna Leach in The Register gives the lie to the myth of the information economy which politicians have argued for years is the solution to the UK's economic woes.

'Almost no apps cover their development costs and software services only make money in "extremely unusual" cases, some proper engineers have told MPs,' wrote Leach in The Register on 23 April.

The Parliamentary Science and Technology Committee has been taking evidence from a wide range of individuals and organisations in an inquiry, launched late last year, entitled 'Bridging the "valley of death": improving the commercialisation of research'. Written evidence from the UK Computing Research Committee (an expert group set up a decade ago by the British Computer Society, the Institution of Engineering and Technology and the Council of Professors and Heads of Computing) pours cold water on the idea of an information economy based on exploitation of the internet.

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Other stories

A new NUJ branch for London: 19 April: Event on the lessons of Twitter

TUC's Netroots UK returns to London

Book publishing looks into the abyss

Yahoo! on job cuts spree

Does Facebook really own the word 'book'?

ACTA - How America tries to own the world

A 'right to be forgotten': the EU's false prospectus for data protection

New branch for NUJ members in new media in London

EU asks Google to delay privacy changes

Iran steps up attacks on blogs, websites and print media

Parliament may debate the Google privacy changes

Leveson: the Internet Pops In

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