Page 7 - Newspaper of the Future Case Study
P. 7
JP
JP
JP possessed economies of scale which would allow them to reduce the cost
of everything from newsprint to payroll and pensions. However, at the time of
purchase of the Scotsman JP said it had no plans to cut jobs at the company
and would instead invest in content.
With such assurances the sale also had the backing of Scotland’s top
politicians. In particular the government saw regional press as important and
regulators were 'relaxed' about consolidation. Scottish editions of right-wing
unionist newspapers headquartered in London are more popular in Scotland
than its own indigenous papers despite the fact that this is a nation now
dominated by left-wing voters who support independence and the SNP.
In 2007 JP’s share price peaked but thereafter declined rapidly. By 2009 JP’s
share price had halved from its 2007 peak of 491 pence to 250 pence as
investors took fright when the advertising market stalled. The unwinding credit
crunch and the financial downturn ensured that there would be little chance of
its recovery.
