As the multi-media revolution continues to thrive in a digitally disrupted world, the traditional newspaper business model is heading out the door, according to Gregory Hywood, CEO of Fairfax Media.

This requires a fast and furious transition from a print model to one that incorporates media across multiple platforms.

“We are absolutely on a journey from print to digital,” he said. “We know that some part of the future will be predominantly digital.”

Hywood discussed how Fairfax looks to reconfigure its news model at Sydney Morning Herald and The Age, “restructuring so when the time comes, we’ll be ready.”

Continuous shifting and fragmentation of media consumption are changing the news market, which means companies must look to develop creative production.

“The restructure is driving innovation,” Hywood said.

Because the news industry is heading toward a multi-media-focused future, Hywood recognises that Fairfax must respond by radically changing its business model.

As advertising print revenues decline and digital viewership continues to increase over short- and long-term, news industries must implement a new model that embraces digitalisation and represents their readership.

With an audience of more than 9 million, 70% of whom access Fairfax’s publications by digital means, the company looks to hone in on serving this digital audience.

“Today we are more connected to our audiences as ever, and our audiences are as big as ever,” Hywood said.

Recently announcing a “Fairfax of the future,” the company has implemented newsrooms that focus on digital-first production. The new structure streamlines revenue generation.

Hywood presented three concepts companies must consider if they aim to generate revenue by making the shift toward digital:

  • Understand what costs are required to run a newsroom.

  • Think about the benefit of a newspaper and its relevance to an online audience.

  • Consider broader network effects.

These concepts lead to a reduction in cost. And while profitability is the goal, Hywood notes that defining whether or not a publication is profitable can be complicated.

Like all print news organisations, Fairfax’s core focus has been a commitment to profitable newspapers. According to Hywood, the revenue must come from understanding the industry’s changing dynamic and acting on it.

“We believe that newspaper profitability can’t exist solely on a stand-alone days of the week basis.”