Trinity Mirror chief executive Sly Bailey told the Leveson Inquiry yesterday that the business was facing ‘intense’commercial pressures – and likened the situation in its regional division to ‘a knife falling that is getting sharper on the way down”.
Asked about the main pressures facing the company, Bailey said they were the structural changes posed by the internet and the emergence of handheld devices coupled with the ‘cyclical pressures’of the recession.
While Trinity had adapted well to the former, it had faced major struggles since the end of 2007, particularly in its regionals division.
Bailey told the inquiry that while 60 per cent of revenue from its national newspaper business came from the cover price, the figure was just 30 per cent among the regionals, which had seen advertising turnover plummet during the economic downturn.
Recruitment advertising, for example, had fallen from £150m in 2007 to less than £20m in 2011, she said.
Bailey was asked by Lord Justice Leveson if there were any structural changes that could be introduced to help the local press, which he said was a ‘vital part of local democracy”.
She said her ‘biggest concern’was a regulatory one – namely that the completion authorities were opposed to further mergers in the regional newspaper market.
She cited the case of the KM Group’s failed bid to buy seven newspapers from Northcliffe last year, which has since resulted in job losses and title closures across both companies, before stating that the economic situation facing the regionals division since the onset of the downturn in 2007 has been like ‘a knife falling that is getting sharper on the way down”.
“The business has been under the most intense cyclical pressure as a result of the economic situation,” she added.
‘No evidence of phone-hacking’
Bailey also said she was unaware of phone-hacking taking place at any of her newspapers.
“I have seen no evidence to show me that phone-hacking has ever taken place at Trinity Mirror,” she said.
In her witness statement, she added: “With regard to the print media, I believe ethics to mean that our journalism has truth, accuracy and fairness at its heart, with no tolerance of bullying, or harassment, unlawful activity or corruption in our newspapers and websites.
“I see high standards of ethics being critical to our success.”
Bailey said that the company did not feel it was necessary to launch an investigation into phone-hacking at Trinity Mirror because there was no evidence it had ever occurred, describing a BBC Newsnight article about hacking at the Sunday Mirror as “terrible journalism”.
“They were running unsubstantiated allegations as if they were fact and I think that is terrible journalism,” she said.
She also discussed the company’s decision to fire former editor Piers Morgan in 2004 after he published fake Iraqi torture photographs.
It was a “catastrophic editorial error” that lost a lot of readers and led to a ‘maelstrom of interest in the business”, she said.
“Frankly it was not so much the publishing, which I do believe that Mr Morgan did in good faith, but what happened in the intervening period, the board lost confidence in him as editor and that is why we fired him.”
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