Guardian Media Group looking to close The Observer

(photo by Florian)  The world’s oldest Sunday newspaper, the London-based Observer, is on the verge of closure as its Guardian Media Group owners look to save costs. The Scott Trust foundation which owns the GMG is drawing up plans to turn the 218-year-old title into a mid-week news magazine. Foundation members opposed drafts of the proposal last month and executives have gone back to the drawing board to determine the best way forward.

The decision was forced on the GMG after an annual loss of $180m last week with its flagship newspapers The Guardian and The Observer losing $74m. The group immediately began work on a three year strategic plan to come up with radical measures to staunch the losses. But while the charter of the Scott Trust (“to secure the financial and editorial independence of the Guardian in perpetuity”) means The Guardian will be protected, there is no protection for the Sunday broadsheet the Trust bought in 1993. GMG’s chief executive Carolyn McCall said the paper could withstand the losses this year (and last year) but it could not do so three years running.

Donald Trelford, Observer editor between 1975 and 1993, told the BBC’s Newsnight last night the problem is caused by a combination of factors. He blamed the large Saturday newspapers which take all weekend and beyond to read, competition from free content on the Internet, and the Scott Trust protection of The Guardian from the open market. Trelford said that without The Observer “we’d be left with the Sunday Times […] and the Sunday Torygraph [sic] and I can’t believe that would be a healthy thing for British democracy”.

Mark Hanson
of The Independent (with a similarly troubled Sunday edition) says The Observer is paying the price for bad strategic decisions by Guardian editor-in-chief Alan Rusbridger. In May Rusbridger announced a merged team would operate across three platforms (the two newspapers and the website that would keep the “distinct voice” of each platform separate. Hanson claims Rusbridger sunk $120m into bespoke printing presses that no other newspaper can use because of the papers’ unique Berliner format.

This is not the first time The Observer’s future has been threatened. GMG tried to shut the paper down five years ago. They commissioned consultants who suggested the Trust replace the newspaper with a magazine. The proposal was fought off by members of the trust and then-editor Roger Alton. Despite the decline of the British newspaper industry since 2004, the paper still has a healthy readership. The paper has a circulation of 420,000 (17 percent of the Sunday market) and a readership of 1.37 million.

If it does disappear it will be a sad moment in British history. W. S. Bourne founded the paper on 4 December 1791 with a commitment to the free communication of truth. Initially subsidised by the government in return for favourable reviews, it gradually found its own voice. Under David Astor in the 1940s it became a liberal, trust-owned publication, with no political affiliations. The paper became a pawn in Tiny Rowlands’ war with Mohammed Al Fayed in the 1980s before being taken over by the GMG after a House of Commons motion opposed its closure. It is difficult to believe today’s parliament will feel a similar sense of outrage.


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