Commuter freebies floundering financially

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      There was more bad news this month for the beleagured Metro International S.A., which is a partner in the Vancouver Metro Vancouver commuter paper. Read the masthead of the local freebie, and you'll see that Metro is billed as "the world's largest newspaper, with more than 18.5 million readers in 100 major cities in 21 countries".

      What the masthead neglects to mention is that it is also part of one of the biggest money-losing publishing companies in the world. On October 22, Metro International announced a group operating loss of US$18.2 million in the third quarter of this year. That's significantly higher than the US$8.9 million loss in all of 2006, excluding divestments.

      In other words, Metro International has managed to lose more than twice as much in this past quarter as it managed to lose all of last year (discounting the effects of the falling U.S. dollar).

      Metro International's US$18.2 million loss came on sales of US$91.5 million. This means that for every $5 in sales, the company posts a loss of almost $1. This has occurred despite Metro's efforts to woo advertisers by selling its front covers.

      It makes one wonder about the future of free commuter papers. Two-and-a-half years ago, three of these publications appeared on the streets of Vancouver.

      Dose , created by CanWest Media Works, stopped publishing papers last year. More recently, local billionaire Jim Pattison dumped his 50-percent stake in a different commuter paper, 24 hours , which he created along with Quebecor Inc. in 2005. Pattison isn't known for selling profitable businesses, so it's safe to assume that 24 hours is still recording significant losses.

      But it's the financial woes of Metro International, the world's biggest publisher of commuter papers, that raises questions about this nascent industry's future. Maybe people want a little more fibre with their newspapers, and they're not quite as celebrity-obsessed as the media mandarins might think. Gee, wouldn't that be a refreshing thought?




      Oct 27, 2007 at 3:08pm

      Holy self-serving negative marketing masquerading as journalism, Batman! The Straight, which used to be a serious alternative paper, now a pale shadow of itself bloated with the same kind of advertising as Canwest real estate sections, must be feeling pretty threatened by all the extra free newsprint on Vancouver's streets to run this kind of claptrap.

      Nowhere in this piece are there any hard numbers about either the Vancouver editions of Metro or 24 Hours -- not even national-level numbers. Rather, it takes two items -- Metro SA's international numbers and Pattison's move out of 24 Hours -- and runs wild with speculation and conjecture about how the Vancouver editions are doing. If I recall correctly, Metro SA only owns half of the Vancouver edition (Torstar owns the other half; it was 1/3 Metro SA, 1/3 Torstar and 1/3 Canwest until May of this year), so the international numbers have even more of a tenuous link to the local scene. As for 24 Hours, it would be interesting to know why Pattison sold, but we never really find out her -- to simply speculate that Pattison wanted off a sinking ship is a facile argument. You could just as easily argue that Quebecor wanted solo control of the Vancouver edition as they create a truly national network of 24 Hours publications (they just opened Edmonton, Calgary and Ottawa versions in the past 6 months to go with the Vancouver, Toronto and Montreal ones) as they move away from the failing Sun tabloid model.

      Sure, both papers are probably still losing money, but the suggestion that they're headed for oblivion seems pretty far-fetched, since they represent Torstar and Quebecor's entries into the Vancouver daily newspaper market -- a market that they've never been able to crack before given the Canwest stranglehold. Given the labour chaos that seems to hit Canwest every time they negotiate a contract, it makes an awful lot of sense to hang on those free dailies until the next time the Sun and Province go on strike -- the resulting bonanza of advertisers looking for a daily market would go a long ways towards recouping the past losses and give them a stronger base to work from in the future.

      I've been disappointed in the Straight's slide in serious editorial content for the last few years, but never outright disgusted by it -- until now. Next time somebody in the Straight complains about the Sun and Province skewing their editorial content in favour of their own bottom line, remember this article. I guess I'll head back to the Tyee for some serious media critcism.

      John Burns

      Oct 27, 2007 at 9:06pm

      Hi Squishy,

      Thanks for your comments, and thanks for holding us to such a high standard.

      You seem to have a very acute understanding of the media environment in Vancouver. You clearly feel some of our underperformance comes from our partisan position. I wonder if you have any media affiliation of your own you'd like to throw into the discussion.

      Or are the consumers of print journalism in Vancouver really this sophisticated? I'm delighted to believe this might be so...


      Oct 28, 2007 at 12:55am

      Hi John,

      Yes, I'm in the industry, but not in Vancouver and not with any of the organizations mentioned in the article or in my comments (that is, Metro, Quebecor, Canwest, Torstar/Black Press), nor do we compete with any of them in my market. Nevertheless, I'm very interested in media in Vancouver, obviously. And that's what made the piece so disappointing to me -- I saw the headline and thought the Straight had the goods on the new entrants in the Vancouver newspaper war. But in the end, there was nothing -- not even hard numbers like Audit Bureau results or NADBank readership numbers, which dailies across Canada (especially the Globe and the Post) take and skew to build themselves up and trash their competitors. But at least they're starting with some concrete stuff.

      I'd certainly prefer not to think that the Straight skews its editorial for its own advantage, but I'm afraid it's not an unreasonable assumption for someone who reads this piece. If I'm mistaken, I'll change my critique: there's no way this story should have run the way it did because it creates a clear *impression* that the Straight torqued it to cast doubts on the viability of its competitors.

      To answer your last comment, I may have an unusual interest in the issue, but overall I think Vancouverites (and others, like me, who read the Straight from afar) are sophisticated enough to demand solid, in-depth media criticism, and the Straight is in a unique position to provide it in print. Perhaps having a freelance/outside hand is the best person to write it, though. Darren Barefoot does a fair bit of media observation on his local blog (, and there's also Donald Gutstein, already an occasional contributor to the Straight (though he seems to do more media criticism on the Tyee website).

      Charlie Smith

      Oct 28, 2007 at 1:53pm

      Geez, some readers are sensitive. It was a very short commentary--not a news story--pointing out the obvious: commuter freebies are floundering financially. Perhaps they will prosper in the future, but they aren't now. Metro sells its front cover. I don't know what 24 hours was trying to say with that recent blue cover, but I'm under the impression that it was a full-page ad for something. I hope the employees don't lose their jobs because the ones I know are very nice people. Let's face facts: Jimmy Pattison doesn't generally bail on money-making enterprises. Anyone who knows anything about newspapers knows that these commuter papers are really focused on taking business and circulation from the Province. Torstar was moving into the backyard of CanWest, which in its heyday gobbled up something like 70 percent of all print advertising in this market. If Pierre-Karl and the boys from Sweden were only interested in the Straight's advertisers, they wouldn't still be blowing their financial brains out in this market with their DAILY commuter papers because it wouldn't be worth it to them and their shareholders. They're hoping that people will pick up the freebies rather than putting coins in the box to buy the Province. It worked to a certain degree in Toronto, where the daily Toronto Sun lost circulation. The Province has also lost some circulation according to the recent NADbank numbers, but nowhere near as much as would be necessary for these commuter papers to put a serious dent into CanWest's Lower Mainland financial edifice.


      Oct 29, 2007 at 11:42pm

      Some writers are sensitive, more like. :-)

      Charlie, I never said 24 Hours and Metro were gunning for the Straight -- I agree that the Province is the real target. But in a war, there's collateral damage, and the Straight, as the most visible free-pickup publication in Vancouver, is bound to be feeling some effects from the glut of free newsprint on the street. Combine that with what read to me like a hack job on the free dailies and it made me wonder why it ran. If that's not the case and Dan McLeod is still awash in cash from condo ads, good for the Straight -- but your commentary is still pretty flimsy. Like I said, I saw the headline and thought you had some hard goods on the local free dailies, not some conjecture based on Metro SA's financials and Jimmy Pattison bailing out. Call me disappointed.

      As for your piece being commentary, not news, I can only say that the two are not that clearly distinguished in your web version, where I found the piece (News & Views, under its own category "Press Clips").

      I will say it's nice to have this exchange with the writer and Straight staff right off the main story in a public forum like this. Beats the hell out of a letter to the editor or a private email exchange for my money. Good on you for not only taking your lumps in public (as you should) but making a discussion out of it.

      Charlie Smith

      Nov 1, 2007 at 6:27pm

      I put my name on my articles. I don't post comments anonymously on other sites, such as Holman's. You are clearly employed in the newspaper business because the average Joe doesn't know what NADbank is. I wonder why you feel it's necessary to hide behind some sort of alias. It makes me wonder if you're trying to discredit the relatively short commentary to serve your own employer's interest. If so, it's a bit rich for you to accuse me of doing the same thing.


      Nov 4, 2007 at 1:39pm

      Charlie, if you had read the comments above, you would know I've already disclosed I'm in the newspaper business. However, to blow away any doubts I'm hiding something for my own gain, here goes: my name is Tim Shoults and I work for Glacier Ventures, a publicly-traded company (TSX: GVC) which runs community newspapers, trade and business publications in B.C., Alberta, Saskatchewan, Manitoba, Ontario and Quebec. Glacier competes in the B.C. Interior with Black Press (and thereby Torstar) and I think it competes with Quebecor in some markets in Alberta and Saskatchewan, though I'm not positive on that. Neither of them are our competitors in my market (Squamish, Whistler and Lillooet). We launched a free daily newspaper in Squamish/Whistler to go with our weeklies last year, so perhaps I have a bias towards believing that free dailies can work, but I wouldn't say I'm married to the concept, nor is there any link between our little daily and the Vancouver ones. Glacier's interests in the Lower Mainland are limited to Business in Vancouver Media Group, which owns the weekly business newspaper of the same name plus some visitor publications.

      In short, I have nothing to gain, personally or professionally, from the success or failure of 24 Hours, Metro or the Georgia Straight. I'm simply a media junkie with a healthy appetite for good media criticism -- which I thought I was going to get (he said for the umpteenth time) when I saw this headline. Instead, I got some half-baked speculation based on largely irrelevant data, topped off with defensive recriminations from the writer that amount to shooting the messenger. My only consolation is you're doing this in public (if anyone's still reading this, anyway).

      I'm not trying to discredit your commentary for gain: I'm pointing out that it discredits you, in the increasingly vain hope that it might inspire a better effort. Like I said before, the Straight is in a unique position in Vancouver to provide independent media criticism to a mass audience. What you do with that is your business, I guess.

      John Burns

      Nov 4, 2007 at 4:44pm


      Transparency = good. Striving = good. Accountability = good. Therefore, you = good.

      Thanks for keeping this dialogue going. John


      Mar 5, 2010 at 10:56pm

      It is plainly evident to me that the Georgia Straight runs relatively weak stories and commentaries quite often, but I think I understand why. They are trying to cover the job of the daily newspapers, radio, and TV news, which are extremely derelict in their primary duty. So the Georgia Straight uses some of its meager reporting capacity to cover some of the under-reported stories. The quality isn't always that high, but I assume that it is the best they can do with the money, time, and manpower available. At least the stories that we do get in the Straight provide an alternative voice to the mainstream pap and typical sinister propaganda that fill the pages of the commuter papers, Province, and Sun.

      And I, along with many others, are extremely grateful to get as much independent reporting on local, national, and international affairs as we do get in the Straight, which is practically the only independent source of news in Vancouver.