AAP’s newswire to close in June

The national newswire will shut down after 85 years, with other media divisions to be sold off.

Australian Associated Press will be broken up after 85 years, with its national newswire to be shut on June 26. Picture: AAP

Australian Associated Press will be broken up after 85 years, with its national newswire to be shut on June 26 and some of its remaining media operations sold off.

The decision to close the newswire, plus its Pagemasters sub-editing and production business at the end of August is a blow to the local media industry, which is grappling with declining advertising revenue and rising competition from technology giants such as Google and Facebook.

AAP chief executive Bruce Davidson informed staff at 2pm of the decision by its shareholders, which include News Corp Australia, Nine Entertainment, Seven West Media and Australian Community Media.

Mr Davidson told staff that Nine and News Corp, publisher of The Australian, will boost their staff numbers and “there will be opportunities for some of our staff”, according to a tweet by AAP’s political reporter and chief of staff Daniel McCulloch.

AAP will be closing.

— Daniel McCulloch (@dlmcculloch) March 3, 2020

AAP chairman Campbell Reid described the newswires as Australian “journalism’s first responder”.

“It is a great loss that professional and researched information provided by AAP is being substituted by with the unresearched and often inaccurate information that masquerades as real news on digital platforms,” added Mr Reid, who is also a senior News Corp executive.

AAP blamed the decision on the “decline in the number of media companies subscribing to the news wire service in recent years”.

“The unprecedented impact of the digital platforms that take other people’s content and distribute it for free has led to too many companies choosing to no longer use AAP’s professional service. We have reached the point where it is no longer viable to continue,” AAP said in a media release.

AAP management carried out a major restructure in 2018, which led to more than 30 journalists being axed and the closure of its New Zealand Newswire, in a bid to cut costs.

Mr Davidson said AAP has been a “critical part of journalism in Australia since 1935, and it is tragic that it will come to an end”.

“Hundreds of wonderful journalists made their start at AAP and went on to brilliant careers. Many others chose to stay with the agency for several decades and are part of the revered ‘AAP family’,” he said.

AAP’s press release distribution business Medianet and media intelligence unit Mediaverse will be sold off, but the Pagemasters editorial production service will be shut down at the end of August.

John Murray, Sydney stockbroker and partner at Aitken Murray, told The Australian he had been looking at AAP assets since the Nine-Fairfax Media $4bn merger over a year ago, after predicting Nine would likely pull out of the AAP newswire partnership.

Mr Murray has been tapped by Mr Davidson to find solutions for other profitable parts of the business, such as Medianet and Mediaverse.

“My mandate is to examine opportunities for the rest of the business, and that might not be a total sell-off but a reorganisation, a partnership, new capitalisation or a new owner,” Mr Murray told The Australian.

“Unfortunately the newswire service doesn’t seem financially viable.”

This week's top images, selected by AAP's Head of Photography, Neil Bennett.https://t.co/uZ732w31qi#aapphotos #sports #floods #coronavirus #covid2019 #jacindaardern

— AAP Newswire (@AAPNewswire) February 28, 2020

Mr Murray said AAP had been hoping to draw on a $50m government fund for independent journalism and had been in talks with tech giants Google and Facebook, however, it seems unlikely a deal will go ahead.

“We have been working hard to engage the $50m government fund that is not provide for independent journalism in a partnership with the internet giants, but we have not of had a lot of success to be honest.

“If Google and Facebook were to buy (AAP’s) news, then News Corp and Nine would prefer to sell that themselves obviously.

“Bruce Davidson has genuinely worked as hard as he could to make sure as many people as possible have a job and has fought hard with the owners to get a good deal for his people,” Mr Murray said.

Australia’s biggest media union, Media Entertainment & Arts Alliance, lashed out at the decision, which will affect about 180 editorial jobs, and urged the government to “rein in digital giants”.

“Google and Facebook are riding the coat-tails of news outlets, using the outlet’s news stories to lure away their audiences and advertisers which leads to the platforms also taking from the revenue streams that those news outlets sorely need,” MEAA media federal president Marcus Strom said.

“This erosion of media revenues through the proliferation of sharing of content for free by the giant digital platforms is a major cause of why AAP is losing subscriber revenue.”