News Corp UK suffers £3.5m loss after £51m profit the year before
Rupert Murdoch’s British newspaper and publishing division suffered an operating loss of £3.5m in the year up to June 2014 compared to a £51m profit the year before.
The loss by News Corp UK & Ireland, which owns the Times, Sunday Times, the Sun and the book publisher HarperCollins, is revealed in accounts filed by the company, without fanfare, at Companies House.
One stand-out feature was the plunge in the profitability of the Sun, where operating profits were down to £35.6m from £62.1m in 2013.
The Sun’s revenues fell 5.5% to £489m, due, says the report, “to continuing market decline in newspaper circulation, particularly for the popular segment”.
Last month, the paper revealed that some 225,000 subscribers had signed up for online packages, which it regarded as a success, but it did not compensate for the continuing decline in print revenues.
Similarly, earlier this month, News UK made much of Times Newspapers having returned an operating profit of £1.7m, but the accounts reveal that it suffered a pre-tax loss.
After a previously positive financial outlook from their pay wall system and released profits it seems as though the pay wall has not been so successful after all. Despite encouraging signs with 225,000 people subscribed to the Sun the profits were not enough to make up for the failing print platform. This perhaps suggests that even a pay wall may not be enough to save newspapers considering that even with that many subscribers it can't make profit. However the article does speak of the heavy fines faced by Newscorp due to their hacking scandal which have significantly contributed to their losses. I therefore feel that the pay wall is the future of newspapers as the print format, as proven by The Sun is no longer economically viable.
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