Friday, 27 November 2009

At 78, Is Murdoch Continuing To Outwit Us All?

After reading an article posted on the Guardian this week – I was left wondering how, at 78, Rupert Murdoch continues to keep all media moguls at bay with his controversial decisions gaining the kind of coverage that consumer brands would dream of.
Australian-born Murdoch began with one paper within his native country quickly rising through the ranks he began to dominate both the print media and television market (creating Sky in 1989) and this year Forbes were forced to continue recognising his importance – as the 132nd richest person in the world, it cannot be disputed that Mr Murdoch knows a thing or two about his media.
However, the recent criticism has addressed Murdoch’s supposed ‘venture’ to remove stories from Google and encourage the public to pay for content online. Arguably, certain case studies prove paid-for content does not work online – for the consumer or the entrepreneur looking to make a fast buck. A good example can be found back in September 2005, when the New York Times (with an all encompassing daily circulation of around 1.5million) announced a subscription-based service that would now be in place for daily columns known as TimesSelect. Costs were relatively low, but the service was hardly a success with bloggers working around the rule and re-posting the content online.
TimesSelect was discontinued in 2007 reflecting a growing view (that still very much exists and garners much support today) that subscription fees cannot outweigh the potential ad revenue from increased traffic to a free site – a view that Murdoch appears to be ignoring in favour of pioneering new techniques. According to a report in yesterday’s FT, Murdoch’s choices go beyond spitting his dummy out at common web beliefs and towards cosying up to Bill Gates and Microsoft’s newest search engine venture Bing (which, since its launch in June, has quickly been established as Google’s biggest competitor). According to the Guardian, it would seem that ‘Microsoft may be willing to do what Google, so far, has resisted: pay news organisations for the privilege of featuring their content on its site’.Perhaps we shouldn’t be so quick to write off Murdoch and his old age; after all he is sitting on a 4 billion fortune - a testament to his success. And just as Murdoch’s alliance with Thatcher saw The Sun credit itself with helping John Major to win an unexpected election victory in the 1992 general election – the News Corporation could be first to succeed with paid-for online content, leaving Murdoch laughing all the way to the bank.

Thursday, 26 November 2009

Crude politicking will hurt Cameron

Just got back from a visit to a client during which the conversation turned briefly towards David Cameron’s fact checking issue. As my client eloquently put it. “What a c#ck up. I bet he got back to his office and tore a strip off somebody.”

The facts of the case are almost immaterial but, for those not in the know, Dave accused the Prime Minister at PMQs of state funding two schools with links to Islamic extremism. The BBC this morning ran with the fact that the Conservatives had been forced to concede they had got some facts wrong.

Couple of points. Firstly, what beggars belief is why the Tory party chose this line of questioning yesterday. There are plenty of vulnerable areas to attack this Government on, domestic terrorism is not one of them.

Secondly, Cameron has now given a Brown a wonderful put down for PMQs. Expect Gordon to be asking “has the Leader of the Opposition got his facts right this time?” every time he gets to his feet.

These are dangerous times for the Conservatives. As many commentators have rightly pointed out there is no groundswell of popular support for them. In many ways they are the least worst option. And, as the Prime Minister himself has found out over the last two years, seemingly small issues can grow disproportionately in the public’s mind to become issues of leadership and credibility.

Cameron has benefited in the last year from the fact that the media spotlight has not been trained upon him. Any more c#ck ups like this and that spotlight may begin to turn.

Wednesday, 25 November 2009

Hung Out to Dry

Interesting and increasingly topical article in today’s Independent by Steve Richards, who is hoping for all the drama and back door deals that a hung parliament would bring. It can be found HERE.

I like Steve Richards’ stuff but I can’t help feeling that he is viewing this through the prism of the Westminster bubble (can you view a bubble through a prism?). Anyway, I’ve no doubt a hung Parliament would be hugely exciting (particularly for the political commentators), but I worry about its effect on the economy and wider business confidence as a whole. From where I am standing, business badly needs the certainty of a Government with at least a workable parliamentary majority (circa 40-50 seats). What it certainly does not need is for the current ‘limping along’ to carry on past a General Election. If it was anything like 1974 that would mean circa 5-6 months of limping before a second election in the late Autumn.

In recent days I’ve had two conversations, one with a client and one with a former colleague, both of whom have echoed this same point. My client, acutely aware that the Conservative Party has vastly different views on the climate change debate in comparison to the current Government, wants clarity on key proposals, particularly in relation to renewable technologies and their finance. My former colleague, (I’d call him a City Grandee but he’s only 46, sorry John!) rightly pointed out that relations between the main parties are so fractious that a governing coalition is all but impossible. He’d like a public information campaign to warn the public of the dangers of having Brown, Cameron and Clegg squabbling for six months (God forbid!).

As ever, the financial markets will be first to deliver their verdict and I would be more than willing to bet that the FTSE will take a serious hit the day after an election if we have no outright winner.

Friday, 20 November 2009

A Damascene Conversion

Interesting article in today’s FT by Martin Wolf which can be found HERE. Martin, arch-proponent of capitalism, is proposing a windfall tax on bank bonuses. This is the economic equivalent of Sir Alex Ferguson announcing at a pre-match press conference: “Premiership referees are the best in the world. I will never question them again.”

Much of what Martin says has been heard before, but it is worth revisiting, if for no other reason than to marvel at the sheer audacity of the global investment banking institutions. The banker argument, most recently espoused by Lloyd Blankfein, CEO of Goldman Sachs (who memorably told the Sunday Times a few weeks ago “I’m doing God’s work”) is as follows: “Yes, we took the money, but now we’ve paid it back so we can do what we want”. Blankfein is of course referring to the $10 billion of Federal Government money which kept the firm from going bankrupt in October 2008.

Of course, as Martin points out, this is a gross over-simplification. The institutions now making these enormous profits are effectively being underwritten by Governments around the world (the “too big to fail” argument). Secondly, the enormous profits are in large part due to the unprecedented amount of public money that has been pumped into the financial system, which investment banks are now happily, trading and hedging and collateralising. Thirdly, those making the enormous bonuses are exactly those who almost destroyed the financial system in the first place. Four, ordinary chaps (you and me) are hurting most and will be paying the bill for the bail-out for the next 20 years.

As Martin says “windfall support should be matched by windfall taxes.” However, he does miss out one other key factor in the investment bank re-birth, namely lack of competition. The banking crisis effectively narrowed the field considerably as Bear Stearns, Lehman Brothers, Citigroup and others, for different reasons, are no longer playing. So, in short, the likes of Goldman’s has a bigger, better playing field to play on and fewer opposing teams. Not bad is it?

In the past, the banks have been able to defend themselves against this sort of attack by shooting the messenger, but Wolf is highly respected. They might struggle with that strategy this time.

Thursday, 19 November 2009

Ladies and gentlemen, the President of Europe

Tonight Europe’s great and the good meet in a smoke filled room to select our new President (how democratic!). I confidently predict that there will be no street parties, bunting or celebration of any kind, not least because you probably won’t ever have heard of him or her.

For Tony Blair supporters this is bad news, but in all honesty I don’t believe he ever stood a chance for two reasons. Firstly, he’s damaged goods. Although he may not realise it himself, Iraq and his slavish following of the Bush Administration severely damaged his reputation in Europe and positioned him for all time as an ‘Atlantic Man’ rather than a European.

Secondly, and this is key to understanding who we are likely to get, Blair, though damaged, remains a big beast, capable of generating international headlines. Sarkozy, Merkel and Berlusconi won’t want that. If anyone is going to be photographed having tea with the Obama it is them, not some new President.

So what can we expect? My guess is that we will get a faceless bureaucrat who will be greeted in this country with a chorus of “who’s that?”

Tuesday, 17 November 2009

It’s the Sun wot spun it

Apologies to my fan (sorry Mum) for not blogging over the last few days. I’ve been out of the office with no access to a computer which meant that I was unable to do a quick update on The Sun’s treatment of Gordon Brown (see Real Callousness – Wednesday 11th November). Anyway, towards the end of the blog I mentioned that we could expect the Sun to try and make amends for its mauling of Gordon with a gushing piece on Sarah over the next few weeks.

And lo and behold Friday’s paper had this news story (I use the term news in its loosest sense) complete with a review of Sarah’s wardrobe by the editor of Cosmopolitan magazine. Members of the public relations profession will recognise the happy confluence of the Sun’s need for a positive Brown story (“look we’re not that bad, we’ve been terribly nice to his wife”) and some excellent work on the part of Sarah Brown’s PR people.

However, I suspect this story was not a difficult sell. Sarah Brown, formerly of Brunswick, is very well connected in the London media world. For the Sun this will have been like giving an old friend a pat on the back.

Thursday, 12 November 2009

I’m retiring from international football

I’m sad to announce that I’m bringing the curtain down on my career in international football. Without wanting to add further to the problems faced by Fabio Capello in the wake of the Aston Villa player, Luke Young’s, shock retirement last night, I just think South Africa might be a tournament too far for me.

Years of pizza, four packs of lager on a Friday evening and an increasing aversion to any kind of physical exercise are, I admit, beginning to affect my performances. I know many will be disappointed and I am already braced, as is Luke Young, for the barrage of criticism that will head my way from the radio phone-ins and national press, in the same way that allegations of being unpatriotic were heaped on Liverpool’s Jamie Carragher when he announced his retirement (but strangely not Paul Scholes).

My only regret is that, if England are based in South Africa’s wine country, I won’t be there to help the WAGs choose between a fruity Cape red and a Spier plantation cabernet sauvignon.

Alas it wasn’t to be.

Wednesday, 11 November 2009

Real Callousness

The newspapers have been full of the Prime Ministers alleged callousness and indifference in recent days as a result of ‘Spelling-gate’. My initial instinct, that this was a politically motivated attempt to humiliate the Prime Minister, is proving well founded.

On this Armistice Day allow me to tell you a story of real callousness from another age, to put all of this in perspective.

My Great Uncle, Robert Ballard, was a member of the Royal Field Artillery, a regiment equipped with smaller field artillery guns that were generally situated closer to the front lines. As a family we know little about him, other than that he was a beloved older brother of my own grandfather, who eventually called his own longed-for son after him. His role in the Great War was, according to my own mother, “something to do with horses”, presumably tending to the poor animals which pulled the guns into position.

As you have probably guessed by now, he was killed the outskirts of Arras on the Western Front on July 17th 1917. In an act of real callousness, the War Office informed his mother, my own Great Grandmother, of his death via telegram. Nothing unusual in that, except that it was accompanied by an invoice for the blanket in which he was buried. In those days, you not only had to be prepared to sacrifice your own children for the nation, you also had to pay for the privilege of having them buried. To my Great Grandmother’s eternal credit, to the day she died she refused to pay.

Robert Ballard currently lies in Point Du Jour Military Cemetery near Arras. It is a small cemetery named after a particularly strong German redoubt in the near vicinity. The cemetery became internationally famous about 10 years ago when the ‘Grimsby Chums”, members of a Pals Regiment (anybody interested in the sheer idiocy and pointless waste of the Great War should read up on Pals Regiments), were discovered nearby linked arm-in-arm. They were subsequently re-buried in Point Du Jour.

Times have fortunately changed but individuals and organisations are still capable of extraordinary callous behaviour and thoughtlessness. I supect the Sun’s behavior in recent days has offended the British public in such a way. The Sun’s website story is now the recipient of nearly 200 comments from its readers, 90% of which are supportive of the Prime Minister. This will not have gone unnoticed in Wapping.

The talk on the Sun's website is of a callousness perpetrated by a national newspaper which chose to publicly try and humiliate a man on the basis of his disability. The Prime Minister is, if you didn’t know, practically blind.

Apparently, the political editor of the Sun, well aware of the Prime Minister’s failing eyesight, tried to dissuade senior staff on the paper on Sunday night from treating the story as they did. He was ignored.

I suspect we will now see the Sun quietly pull away from this one and try to make amends as it did with its other great cock-ups - remember “Bonkers Bruno” and “Hillsborough – The Truth?” Get ready for a gushing ‘Sarah and the boys” story coming your way in the next few weeks.

Cowell v Clifford. Now That's a Fight We'd Like to See...

Cowell is a clever cookie isn't he. Is it just me or does he makes Clifford look like a rank amateur when it comes to manipulating the media?

By backing the impossibly bad Jedward on Sunday night, he secured front page coverage in The Sun, The Daily Mail and Daily Mirror - all on one day. Imagine putting that in an evaluation report. Just one problem - it wasn't exactly positive reading. Is it really a case of "The Fix Factor"? Who cares? Not Simon.

This is a show that has been beset with negative press coverage - yet it just keeps on growing. It's beating its BBC rival, Strictly Come Dancing, hands-down. A whopping 16.6million people tuned in on Sunday to watch the lovely Lucy sent packing. And I bet even more of us watch this week. As a relative of mine said recently, "I decided to watch the X Factor last week. Everyone is talking about it..."

So why then, when the Beeb gets slated for axing Arlene does the show suffer - and when Cowell backs the worst singers in the history of singing, do his ratings soar?

I guess it's a bit like asking why Tom Cruise's sofa jumping antics cost Mission Impossible 3 over $100m in ticket sales yet Borat's endless slating of Kazakhstan prompted a 300% increase in enquiries on

The producers should never have messed with Strictly Come Dancing. The show is like Marks and Spencers. A British institution. Safe. Solid. The X Factor is not. It's about tears, tantrums and theatrics. Early on, Simon decided he would use controversy to capture viewers and controversial he has certainly been. Cleverly though, he has never let the show be described as poor, just the judges' decisions. He knows full well that we will watch again next week. Admit it, we can't wait to see the fallout.

Plus, Jedward, who are prepared to totally humiliate themselves in front of millions week in, week out, have become strangely endearing - a bit like Borat and, for that matter, Arlene. And most unlike Tom Cruise on Oprah. Nauseating yes, endearing - no.

Tuesday, 10 November 2009

The Top 5 Tools For Twitter

Around 12 months ago, I overheard that Stephen Fry (@StephenFry) had taken to 'tweeting' an awful lot. It was the first time (I was probably behind, I'm aware) that I'd ever heard the expression.
As somebody who used to blog whilst at University and remains to this day an avid Facebook fan (I only check my profile every 2 minutes or so) I was fascinated and immediatley hooked.
It wasn't just that a new 140 characters-limited network had been created, but that it was a network that spawned thousands of useful applications that meant I was instantly able to upload pics (via Twitpic) and download Tweetdeck (both on my laptop and iPhone) and be able to check all of my relevant updates and the people I follow with the click of a button.
Many bloggers have offered great tips for twitter - @crystalquest offers some great tips on how to tweet personally whilst Mike Dodd's thoughts the 'Top Ten SEO Tips' featured on Mashable offer a great a brand perspective. What I wanted to do here was offer what I believe to be the 'must-have' top 5 tools - at last count there were 140 so by no means am I able to profess to have practised them all, but I've had a good go at around 50 and thought I would list the ones that I see as unavoidable should you want to use Twitter effectively.
1. Twitpic Made famous by Ashton Kutcher (who tweeted about his lovely wife Miss Moore in her underwear) with only 140 characters avialable, Twitpic allows you to speak a thousand words with just one image upload - Twitter Tips provides a great list of the top 7 highly rated but in my opinion, user popularity always wins out. Twitpic is the largest and the most visited and it's my first choice.
2. Tweetdeck Ah yes, the aforementioned application software - I think a lot of people don't get Twitter as they simply 'don't have the time' and, as a working professional, I think a desktop/phone application is essential for those wanting to use Twitter both quickly and whilst there on the move. Tweetdeck is my preference as it allows you to log on as multiple users, create column searches and user groups - but there are other highly credible options such as Digsby, DigiTweet and Twhirl - it's all about preference. Jennifer Van Grove offers a very clear guide to the 19 desktop apps available. Have a read and find the one best suited to you!
3. Tweetbeep Just as Google Alerts allowed us to reign in such a large algorithm that powers the search engine and enables us to track certain words, TweetBeep allows you to place a tracker on words that may be of interest - a great business tool. I use it because I'm able to choose how often I want to recieve the results of my tracked words, it can be as it happens or once a week. A review of alternatives can be found an the Open Parenthesis blog
4. #Hashtags Social media, in my opinion, proves not only how ego-centric we enjoy our lives to be but also our continual facisnation of the lives and thoughts of others. Whilst on Facebook you have to trawl through profiles to get to the goodness on Twitter 140 characters ensure it is laid bare straight aware. Tools such as #Hashtags - have allowed us to see what's happening on Twitter now and enjoy having a giggle at searches such as #firstdraftbandnames
5. StumbleTweets Like the social bookmarking phenomenon Stumble Upon , here we have a Google for Twitter so we can have a look at what's really going on, who's being talked about or just search our name and see if anyone's talking about us! As I'm sure you know, Twitter has its own search engine but, with the sheer mass of people using it, it can't hurt to have an alternative when the server goes down and the fail whale appears.
So there you have my indispensable 5 tools for Twitter - most of which I'm sure a lot of Tweeple already use and with Twitter and the tools it offers multipling everyday - I'm sure it won't be long before I feel the need to share my top 25....

Monday, 9 November 2009

A Cronkite moment?

The Independent’s editorial decision yesterday to call for a British Army pull-out from Afghanistan is, to use military speak, a first ‘beachhead’ in the national press for the anti-war brigade.

At present, this does not feel like a Cronkite moment, in which public opinion is turned decisively against a conflict by a trusted authority figure. Walter Cronkite’s famous declaration about Vietnam, live on CBS News (“this war is unwinnable”) was the beginning of the end for American involvement in South East Asia and prompted President Johnson to declare, “if we’ve lost Walter, we’ve lost the American public.”

The Independent does not have that sort of authority, but this is undoubtedly a key moment with the Indy tapping into an increasing public mood of disillusionment. The major political parties now have a national newspaper actively campaigning against continued involvement which will only add to the pressure on them to outline, during the coming election campaign, a coherent strategy going forward. I suspect vague declarations of “not giving in” and “seeing this through to the end” are not going to cut it anymore.

The issue now is, who will flock to the Indy’s banner? Both Labour and the Conservatives are wed to this war for different reasons. Labour, because they got us into it in the first place, and the Conservatives because the party’s history and culture will not allow them to be seen as anything less than stoically pro-war. There is enough skepticism about Project Cameron at grass roots level already without him going all pacifist.

However, I suspect the Lib Dems will be looking at this situation as an opportunity this morning. Clegg has been positioning himself as a war skeptic for some time now and I wonder whether a set of clear objectives for Afghanistan, measurable signposts for success over a 2-3 year period and even a timetable for withdrawal, would be a vote winner at the coming election. It would also give Clegg the opportunity to put the other leaders on the hook in any televised debate.

One more thought. All of this is dependent upon the current deliberations within the Obama Administration about the future direction and support for this war. By the time we reach a General Election in April or May 2010 America might be well on the road to total withdrawal hoping only for a Kissinger-inspired modern day ‘decent interval’ before Afghanistan returns completely to its centuries old lawlessness.

Thursday, 5 November 2009

A fighting retreat?

News Corporation’s interim results make for fairly boring reading, but there was apparently an interesting little exchange during the press conference Q&A in New York, a report of which can be read HERE. As you may well know, Rupert is planning to introduce a pay-wall on all his online news sites and had provisionally targeted June 2010 as D-Day.

When asked about his self-imposed deadline yesterday, he said, and I quote: "I wouldn't promise that we're going to meet that date." Acting unnaturally coy, he then declined to comment on the reasons for any delay except to say that he was talking to rival publishers, including the Telegraph group. "It's a work in progress and there's a huge amount of work going on," Murdoch said.

Two thoughts. Firstly, as I’ve said before on this blog, I’d be interested to know what the Office of Fair Trading think about an attempt by British newspapers to act in concert to fix prices.

Secondly, it is hard not to speculate that this might be the start of a climbdown. Rupert is known to be a luddite at heart, once famously commenting after News Corporation’s acquisition of My Space that “we’re in the stalking business now.” Could it be that he made company policy “on the hoof” and his minnions have now told him that this isn’t going to fly?

The logistics of payment for content are fearsome. The Guardian, in my opinion the best of the online sites and ‘owner’ of more ‘must read’ columnists than any other newspaper (Simon Jenkins, Polly Toynbee, Will Hutton etal), has already declared it will remain free. So that’s at least one hole in his apparent attempts to corral the industry to his way of thinking.

Monday, 2 November 2009

Last train to Waterloo

The late Geordie comedian Bobby Thompson had a wonderful gift for story-telling. One of his funniest routines involved the story of his trip to London and hailing a black cab.

“I got in and said: “Take me to Waterloo.”

“The station sir?”

“Well I think I’m a bit late for the battle” replied Thompson.

I bring this up because the Board of bus and train operator National Express must be hoping that the train has not left the station for its own preferred option of a rights issue, which must be completed by December 31st to avoid a breach of its own banking covenants on £1.3 billion of debt. Having declined Stagecoach’s offer for the company last week, the timescales are perilously tight.

I was talking with a friend and former colleague a few weeks ago and he brought me up to speed with current conditions for fundraising in the City. He has just completed a rights issue for a former client of mine which had got caught in the ‘perfect storm’ of the credit meltdown. The company’s business plan involved relatively high gearing (debt) levels to finance working capital which is then hired out on a three-year replacement cycle.

Prior to the credit crunch the company was a FTSE 250 with a stable and well-respected management team. However, trading conditions and bank aversion to debt brought it within an ace of a breach of its own covenants and only a cash call to institutional investors, in the form of rights issue, could save it. In an unconscious echo of the Duke of Wellington’s description of his greatest battle, my friend described the eleventh hour success of the fundraising as a “damn close-run thing.”

Now contrast this with National Express. The company is going to attempt to raise funds from current investors without a CEO (Richard Bowker’s departure for a lucrative new job in the Middle East in June looks increasingly like a case of “every man for himself”), with the Government threatening to confiscate two of its rail franchises for poor performance and its biggest shareholder (Spain’s Cosmen family) accusing it of a “lack of strategy”.

This is high risk indeed and one must hope that National Express is not about to meet its own Waterloo. And I don’t mean the station.