No fancy stuff: At the Indy, Ivan Fallon passes “Go” and saves £2m on rent

In the end, there was no cross-industry shared sourcing. No fancy joint operating agreement. And certainly no acquisition deal.

Nope – just a saving of £2m on rent and rates.

As Reuters puts it, Associated Newspapers is going to take in the Independent and the Independent On Sunday as lodgers.

Nothing much else is on the agenda. According to IN&M’s statement, the two groups’ “editorial, management and commercial operations will remain entirely separate”.

Notably, however, Simon Kelner has raised the possibility of “sharing other back office services” with Associated in the future. And Roy Greenslade thinks it won’t be long before we see the emergence of “some kind of editorial connection, in production at least”.

Maybe. Presumably, however, Associated has shied away from getting involved with the Indy‘s back-office operation at the moment because this would have involved making even more of its own staff redundant.

(Under employment law, the two companies couldn’t simply have decided to offload Independent employees. But justifying further Associated redundancies in the wake of a deal that visibly benefits IN&M would have been a nightmare internally.)

For IN&M, the £2m saving generated by moving from Canary Wharf to Kensington comes on top of the £10m restructuring programme announced last week.

Against the recent suggestion that the Independent is losing £12m annually, IN&M’s UK chief executive Ivan Fallon seems to have pulled a plump little rabbit out of the hat.

He suggests that this is enough to “transform the prospects” of his papers. It’s not. But hopefully, it will afford IN&M a breathing space.

As for Roy Greenslade’s recent suggestion that the O’Reillys should ditch print and push the Indy online, it still looks a bit previous.

Greenslade’s maths suggests that ditching print would allow £5m of further savings in editorial, and £5m in marketing.

Even after this, he suggests, an online-only Indy would still be forced to surrender £30m in print-related advertising and circulation revenues.

It’s hard to know whether numbers like these originate from the back of a fag packet — or a weightier exercise.

For two nationals that generate a large chunk of IN&M’s £200m UK revenues, the quoted downside of £30m-£40m is much smaller than I would have expected.

Of course, if Greenslade’s source is a proponent of ditching print, he or she may have an interest in accentuating the positives of transition.

Alternatively, the online-only plan may turn out to involve some print advertising revenue after all (perhaps in the form of a weekly news magazine). This would help to ease the transition.

Regardless of the detail, it’s obvious that ditching the Independent‘s daily print editions remains a non-starter. At the moment.

But if Greenslade’s figures are anywhere near correct, the transition could start to look plausible as print revenues decline further during 2009.

It’s worth bearing in mind that print-based ad revenues will fall faster at the Indy than most other nationals next year. This is what tends to happen in a recession if you’re not a market leader.

For the Independent, taking rooms above a shop in Kensington could turn out to be the prelude to real boldness.

The big assumption, of course, is that Messrs Fallon and Kelner can get over their apparent distaste for the web.