A broking company has told investors Trinity Mirror's proposed cut-price national newspaper launch is a "low-risk exercise".
A well-placed source told Press Gazette that those working on the project were either on secondment from other Mirror departments or on three-month contracts.
They also highlighted that Trinity Mirror under chief executive Simon Fox has not been afraid to experiment and abandon failing projects.
They said: "With the closure of UsVsTh3m and Ampp3d, Fox has shown that if new formats don't work, he will shut them down." They also pointed to People.co.uk, a Buzzfeed-style website launched in November 2013 and closed less than three months later.
This morning, broker Peel Hunt said in a note to investors: "Given truly dreadful print advertising trends and a previous commitment to growing digital, this may seem a counter-intuitive strategy by [Trinity Mirror].
"In fact, it is a low-risk exercise, which could prove usefully accretive even on fairly modest volumes."
The broker also suggested that Trinity Mirror "clearly eschewed" the i newspaper, which is being sold by ESI Media to Johnston Press for £24m, "in favour of an organic approach".
Last week, Peel Hunt told investors it was "confused" by Johnston Press's decision to acquire the i. And it said its "initial thoughts" were that investors should reject the deal.
Trinity Mirror has remained quiet about New Day, despite Press Gazette reporting a team – led by Sunday Mirror editor Alison Phillips – was working on the title more than a month ago.
Sky News reports that the newspaper will cost 25p. The Guardian, meanwhile, reports it will cost an initial 20p and be aimed at a mid-market audience, in competition with the Daily Mail and Daily Express.
Peel Hunt estimated that a 20p newspaper with a circulation of 300,000 could generate Trinity Mirror incremental revenue of £18.7m. It said: "This is not a ‘game changer’, but helpful."
Press Gazette reported in January that the new cut-price title was set to launch in late February/ early March. Reports yesterday suggested it would be published for the first time on Monday 29 February – the day Trinity Mirror's annual results announcement. But one well-placed industry source said newspapers tend to launch on Tuesdays because Monday is generally the weakest day of the week for news.