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Newspaper Business Here For Long Haul: Fairfax Chief
by Lisa Murray, The Age

DAVID Kirk is not buying into the argument that the last crumpled newspaper will be read and tossed aside by an exhausted reader in the first three months of 2043.

The chief executive of John Fairfax Holdings, who marks one year in the job next month, dismissed the dire prediction aired in the latest Economist magazine.

His mornings are spent with the newspaper spread across the kitchen table, where he can scan headlines and stories in between eating breakfast and breaking up any scuffles between his three young sons. "A newspaper works for me and nothing else could work for me in that environment," Mr Kirk said.

"Most of us have fairly complex reading habits. We read what we can, when we can, and the newspaper is pretty useful for that."

More than most, he is well aware of the debate raging around the sustainability of the newspaper in its traditional form.

Last week, Fairfax reported a 4 per cent drop in underlying profit to $228 million, and an increase in revenue of less than 2 per cent to $1.9 billion.

Behind the result was the sluggish performance of its two main metropolitan newspapers, The Sydney Morning Herald and The Age, which despite improvements in circulation suffered from a drop in advertising.

Its online division Fairfax Digital, on the other hand, saw revenues surge 75.6 per cent to $96.4 million as more advertisers opted to spend their money online. And Mr Kirk believes the division could make up between 18 and 20 per cent of pre-tax earnings in the next 18 months.

But that's all part of the evolution of a newspaper company, he says.

"Newspapers will have to continue to adapt. You have to have the right product for the right audience and the audience will change and we'll have to change our product."

Mr Kirk, a former All Black captain and adviser to New Zealand Prime Minister Jim Bolger, has been busy helping Fairfax "adapt" over the past 11 months, by expanding into online and regional publishing.

He splashed out $NZ700 million ($A600 million) on New Zealand auction site Trade Me, attracting criticism for spending too much in a small market.

The business is on track to meet earnings targets, and after entering the online jobs market just three weeks ago, has already matched the number of jobs listed by its main rival, Seek.

Fairfax also picked up The Border Mail for $155 million to diversify its earnings away from the big metro dailies, as advertising in regional markets has escaped the broader downturn in the market.