News Corp Australia chief Michael Miller says content is still king

News Corp Australia’s investment in digital content has built a ‘sustainable’ long-term model for journalism, executive chairman Michael Miller says.

News Corp Australasia chairman Michael Miller. Picture: Liam Kidston

News Corp Australia’s deep investment in digital content in recent years has built a “sustainable model” for journalism in the long term, according to the company’s executive chairman Michael Miller.

Despite the many obstacles faced by the industry in recent years, the media giant’s increased focus on premium content and multimedia storytelling — and its commitment to growing commercial partnerships — has paid dividends, Mr Miller told The Australian.

“We have a growing audience and a record audience, and they’re growing because they’re digitally oriented. Additionally, our clients are wanting to spend more time and more money on digital,” he said.

Mr Miller said that while the company’s printed newspapers continued to be an integral part of the media organisation’s mix – “last week, we sold three-and-a-half million print copies” – it was critical to “invest in where the market is moving”.

“Our print business, while declining, is still funding our investment with digital,” he said.

“We’ve been employing video editors, podcast editors and data scientists, and we’re investing in AI and other forms of technology to ensure we’re reaching audiences in different ways,” he said.

“The reality is that the mix of our business has changed and the mix of our workforce has changed with it.

“I’m confident that we now have a sustainable model for journalism and I look forward to the years ahead and the increased scale of our subscriptions.”

Mr Miller said that while advertising income was still a bigger slice of News Corp’s revenue pie than subscriptions, the gap was narrowing.

“We are still a majority client-funded business. I can see a point in the future where it is 50-50, but we’re not there yet,” he said.

Mr Miller said that in an industry that had experienced a greater level of digital disruption than most, one of the great challenges for modern media companies was to maximise the opportunities that new technologies provide while balancing the developments with core business.

Artificial intelligence model ChatGPT has the potential to be “a very valuable journalistic tool”, Mr Miller said, but it could not replicate the broad skill-set of a journalist.

“ChatGPT has yet to show how it can replace that inquisitive lateral thinking of a journalist in seeking truth, and providing analysis and context,” he said.

“It’s an important tool for journalists but it’s not a replacement for them.”

Mr Miller also addressed the industry-wide issue of “subscription churn”, prompted by the increasing cost-of-living pressures across Australian households.

While subscription numbers for streaming services such as Netflix have dropped post-pandemic, Mr Miller said News Corp’s mastheads were executing strategies to retain and build audiences.

“I think the cost-of-living pressures and the re-evaluation of (household) spend will only worsen in the coming six months. So we’ve ensured our teams are focused on retention and providing value to our existing audiences,” he said.

“We spend a lot of effort and time in acquiring a subscriber, so it’s far smarter to keep someone than to try to reacquire them later on.”

Mr Miller said while News Corp’s churn rates “aren’t worsening, we don’t want to be in a situation where we leave remedies too late”.

“We want to get ahead of what we anticipate to be a ‘reconsideration moment’ in the coming months,” he said.

The News Corp Australia CEO was upbeat about the future of the existing publishing deals between major media companies (including NCA) and tech giants Google and Meta (formerly Facebook).

There has been speculation that extensions to the current deals, which were signed after the former Morrison federal government introduced the news media bargaining code in 2021, may be resisted by Google and Meta when some of the contracts expire as early as next year.

“We’ve got good working relationships with them locally,” Mr Miller said.

“Having met with both organisations recently, the view of our local team and their local team is that we had an agreement and let’s keep on working to maximise it.”

On the looming job cuts at News Corp (the company’s global chief executive Robert Thomson announced in February that the media organisation planned to lay off 5 per cent of its workforce), Mr Miller said the current economic headwinds demanded that “we need to recheck and make sure we’ve got the right balance”.

But he said that notwithstanding the redundancies, which will be processed before the end of this financial year, the company’s focus on delivering premium content would not be compromised.

“Content – and trusted content at that – is at our core. That is what our audience and clients ask of us,” Mr Miller said.

On Monday, News Corp will showcase its latest digital innovations at its annual D_Coded marketing event for clients, commercial partners, marketers, media executives and digital specialists.

This year’s centrepiece will be “Total Commerce”, a concept based on media, technology and retail channels converging into a single consumer experience.

“Content is what’s driving ‘Total Commerce’,” Mr Miller said.

“People want to purchase products and services off websites that they know and trust, and that trust is based on the information that the site’s content delivers.”

News Corp is the publisher of The Australian.