Publishing competitors Fairfax and New Corp Australia have struck an historic agreement that will see them use each other’s printing networks.
The deal will save the publishers costs at a time when revenues and circulation is falling and it will help keep their newspapers in print.
Fairfax says it expects to save about $15 million a year, with the benefits set to flow toward the end of the first half of this financial year.
The deal will see News Corp providing printing services for Fairfax in New South Wales and Queensland. For its part, Fairfax will print publications for News Corp out of its North Richmond plant in New South Wales.
Fairfax will also transition work from its print centres in Beresfield in New South Wales and Ormiston in Queensland. Once complete, those sites will close.
Fairfax chief executive officer and managing director Greg Hywood described the changes as “landmark initiatives”.
“The agreements deliver greater cost variabilisation, enabling us to produce newspapers well into the future,” Mr Hywood said.
“Our decision to rationalise some printing assets reduces capital intensity.”
News Corp Australasia executive chairman Michael Miller said the deal would provide benefits of scale and efficiency, and would not impact the content produced by either publishers.
“As a publisher, we have absolute confidence in the ongoing significance of newspapers. Within this framework, we need to continue to look at the most effective and efficient ways to produce newspapers,” Mr Miller said.
“This is a commercial deal which makes commercial sense by enabling better use of our existing print facilities.”