Events | 2009.08.20
The London Paper set to close
The London Paper faces closure as News International begins consultation with 60 staff
In pictures: the London freesheet war
News International said today that it planned to close its afternoon freesheet, the London Paper.
The paper will continue publishing for about a month while News International consults with 60 staff members. It is understood that the London Paper\'s final day of publication is likely to be Friday 18 September.
Today\'s announcement signals an end to the London freesheet wars, which began almost exactly three years ago in August 2006, when News International decided to launch an afternoon freesheet and Associated Newspapers retaliated to protect the London Evening Standard and its morning freesheet Metro by launching London Lite.
"The strategy at News International over the past 18 months has been to streamline our operations and focus investment on our core titles," said James Murdoch, the chairman and chief executive, News Corporation Europe and Asia.
"The team at the London Paper has made great strides in a short space of time with innovative design and a fresh approach but the performance of the business in a difficult free evening newspaper sector has fallen short of expectations. We have taken a tough decision that reflects our priorities as a business."
A spokesman for Daily Mail & General Trust, which owns Associated Newspapers, said: "We are watching developments with interest."
The London Paper recorded a pre-tax loss of £12.9m in the year to 29 June 2008 on a turnover of £14.1m. In the previous 10 months it had lost £16.8m. The paper had a free distribution of 500,348 copies in July, about 100,000 more than London Lite.
London Lite got to the streets first on 30 August 2006, while the London Paper launched on 4 September. The ongoing battle hit the Evening Standard\'s paid-for circulation and eventually forced DMGT to sell control of the title to the Russian businessman Alexander Lebedev earlier this year.
News International\'s other aim in launching the title was to take on DMGT\'s successful morning freesheet, Metro, which in good times before the recession made profits of £8m a year.
The company hoped ultimately to bid against Metro for the morning London tube distribution contract. But News International did not reckon on the ferocity of DMGT, which counterattacked with its own freesheet, published through its national newspaper division Associated Newspapers.
Associated had already given up its rights to the afternoon tube distribution contract following an Office of Fair Trading ruling in 2005.
The former London mayor Ken Livingstone tried to sell an afternoon distribution slot on the tube network after the OFT\'s 2005 ruling, prompting interest from Richard Desmond\'s Express Newspapers and News International.
But the afternoon tube contract became redundant when, instead of bidding for it, both NI and Associated decided to employ an army of distributors to hand out their rival freesheets to commuters.
From August 2006 the streets of central London were flooded with copies of the two freesheets, with evening commuters running the gauntlet of London Paper and London Lite distributors attempting to thrust copies of the brightly-coloured papers into their hands outside tube and mainline train stations.
The problem of what to do about the discarded copies of the free papers that littered the streets of central London soon became an issue, leading to rows with London councils, particularly Westminster, which demanded that both companies pay some of the costs of cleaning up the mess.
In January 2008 NI and Associated finally agreed to install 35 recyling bins each in the West End and Victoria at a cost of £500 each. Six months later Westminster council revealed that 120 tonnes of paper – the equivalent of 1,920 trees – had been collected via the recyling scheme.
The announcement of closure comes two weeks before Sun editor Rebekah Wade becomes chief executive of News International. She had reportedly been tasked with negotiating an agreement with Associated\'s parent company Daily Mail & General Trust chairman Lord Rothermere to stop the heavy losses at both titles.
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