Nine pulls out of joint venture with Daily Mail

Nine Entertainment has pulled the plug on its online joint venture with British newspaper the Daily Mail amid mounting losses.

Nine Entertainment has finally pulled the plug on its online joint venture with British newspaper the Daily Mail amid mounting losses and rows between the two publishers.

Renowned for its “sidebar of shame” — detailing the fashion disasters, romantic liaisons and even facial expressions of celeb­rities — the MailOnline’s Australian operation has been beset by problems since its launch two years ago.

Legal disputes and accusations of plagiarism involving News Corp Australia, publisher of The Weekend Aus­tralian, and Seven West Media, have cast a cloud over the business. Some advertisers avoid booking ads on the website, which they see as a toxic, negative environment with its glut of vicious ­celebrity stories.

The move comes just two years after Daily Mail Australia was launched amid much fanfare. ­Global MailOnline publisher and chief executive Martin Clarke flew to Sydney this week to rescue the relationship with Nine, to no avail.

While the Daily Mail Australia website has built a large online audience, growth has stalled and operating costs have increased, pushing the business into the red.

Despite surging demand for online advertising, Daily Mail Australia’s top line has gone backwards quickly.

Revenue amounted to £16.5 million for the year ended September 30, according to documents disclosed to the London stockmarket in November. This compares with £18.5m in the previous corresponding period, a drop of 9.1 per cent.

Despite surging demand for online advertising, the website has been crunched by falling rates for digital advertising space amid an explosion in supply as journalists, overheads and traffic-acquisition costs pushed up operating costs.

Recently installed Nine boss Hugh Marks will embark on a new digital strategy as part of an ­attempt to differentiate the company’s websites from those owned by News Corp and Fairfax Media.

Mr Clarke vowed to continue investing in Daily Mail Australia, which is one the nation’s top five news and entertainment websites.

The relationship came close to being dissolved a year ago because of a furious row about the sales deal between the two companies.