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Aug 14 2015

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The changing media landscape: the Gleaner—RJR Communications merger

A brief look at the anticipated merger of the RJR Communications Group and the Jamaica Gleaner Company in Jamaica.

Handshake - 2 men by  Flazingo Photos (flickr)In Jamaica last week, the merger of two longstanding and well-venerated media firms, the RJR Communications Group and the Jamaica Gleaner Company, was announced. The RJR Communications Group own local seven broadcast radio and television stations, including RJR 94FM, FAME 95FM, Television Jamaica (TVJ), Reggae Entertainment Television (RETV), and Jamaica News Network (JNN), plus Multi-Media Jamaica Limited which offers digital media solutions. In a similar vein, the Jamaica Gleaner Company not only publishes The Gleaner newspaper, but also has at least 10 other publications for the Jamaican, North American and UK markets, plus it owns at least three local radio stations. In a nutshell, this merger is big and is likely to have far reaching impact on the Jamaican media landscape.

Positioning for the changing environment

In Jamaica today, there are over 20 radio stations operating across the island, which in the view of J. A. Lester Spaulding, Chairman of the RJR Communications Group, has resulted in a saturated market (Source: RJR Communications Group). Further, when the poor economic climate of the country is also considered, there the challenges to remain profitable are compounded.

It is also important to note that the influence of technology, especially the Internet, on customer behaviour. The Gleaner (newspaper) and TVJ (television station), for example, are no longer the only channels through which citizens can access information. The younger generation, in particular, generally tend to be satisfied with knowing the headlines – snippets of information, which can be gleaned from many of the popular social networks, or alternatively they just focus on very specific news items. As a result, and although those firms have been quite progressive in the online space, they are still suffering financially.

For example, and according to Alexa and at the time of publication, The Gleaner, is the 14th most visited website in Jamaica, behind leaders such as YouTube (#1), Google (#2), Facebook (#3), and it is ranked 42,443rd globally. Whilst its local and global rank is enviable, data from Traffic Estimate suggests that The Gleaner’s monthly visitor traffic has been declining by over 20% year on year to just over 550,000 per month as at July 2015 (see Figure 1).

Figure 1:  Estimated monthly traffic (visits) for The Gleaner (Source: Traffic Estimates)

Figure 1: Estimated monthly traffic (visits) for The Gleaner (Source: Traffic Estimates)

This anticipated decline is online visitor traffic, which would not be symptomatic of just The Gleaner, but also most of the other media properties owned by the two merging companies, would also have an impact on advertising revenues. Further, for paywalls that have been instituted to encourage website visitors to subscribe and pay for content, in some instances those constraints can be easily circumvented, which again would challenge the overall profitability of the companies involved.

Potential implications of the merger

Whilst it remains to be seen how the merger will truly affect the Jamaica media landscape, in the first instance, it is expected that the resulting entity will be a true multimedia brand, covering print, audio, video, through which a broad range of opportunities could emerge. The Gleaner and TVJ, in particular, are flagship brands; hence there may be some emphasis on bolstering those properties, and possibly identifying ways in which there could be synergies between the two.

Finally, the merged entity should also be able to benefit considerably from economies of scale and scope, which could be manifested as improved efficiencies and cost savings, to name a few. Further, although there will still be need for a broad range of content to cater to the audiences, in the final analysis, only the strongest brands are likely to survive.

 

Image credit:  Flazingo Photos (flickr)

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About the author

Michele Marius

Michele Marius has a wealth of experience in the telecoms and ICT space, which has been gained in the Caribbean, Southeast Asia and the South Pacific, and in the public and private sectors. She is the Editor and Publisher of ICT Pulse.

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