Should Associated close the London Lite?

News International's decision to close thelondonpaper surprised everyone, even Associated Newspapers, owner of its free rival, London Lite. Will it now follow suit?

London Lite: will it's future be affected by the closure of thelondonpaper?
London Lite: will it's future be affected by the closure of thelondonpaper?

NO - Tim Caira, Head of press, PHD
Associated has kept a tight rein on its cost base. A much lower print run means London Lite's print costs will be lower, and, given it was outbid by NI for various distribution agreements, it seems fair to assume the distribution costs are too.

It also has a content-sharing agreement with the London Evening Standard and sources content from other Associated titles so, again, costs are minimised.

Associated has also managed to generate a sizeable chunk of money from the ad market: about £5m display revenue in the last year, according to The Nielsen Company.

That might not be enough to sustain two free titles where advertising represents the only revenue stream, but if the London Lite can convert enough of thelondonpaper's business, it could make a significant difference.

NO - Lindsey Wolfryd, Head of magazines,  Mediaedge:cia

When the freesheet market exploded in 2006 with the launches of thelondonpaper and London Lite, we all (if we're honest) knew the market could not, in the long term, sustain both.

The recession has just proved this. It is a shame that thelondonpaper is closing. It was a great brand, offered creativity to advertisers and, from a trading point of view, more market competition equalled better rates and better ideas.

However, the fact that thelondonpaper is to close does not mean there is not a role for an evening freesheet. In fact, the £48m reported ad revenue generated by the two brands in the past 12 months shows that clients do value the evening freesheets.

There are many clients who run London-only campaigns and it is important for the press medium to deliver choices. And, most importantly, freesheets are popular with London commuters who now expect free media.

NO - Gabrielle Rossetti, Media manager, Arena BLM
While London  Lite is almost certainly a loss-making venture, it has the potential to be more than just a spoiler.
 
If Associated can find a way to own the morning and evening commutes through its Metro franchise and London Lite, then it will command an exponentially larger share of the advertising market.
 
Lite has a few advantages over its retiring rival: thelondonpaper costs more to produce and has a stand-alone team of journalists, while the Lite takes most of its content from the Standard.  And thelondonpaper prints more than 500,000 copies each day, compared with Lite's 400,000, adding 25% in costs.
 
Thelondonpaper refused to drop its rates when budgets were cut - pricing itself out of the market, while Lite compromised and managed yields. Lite was also able to wangle its way onto other London-based/free schedules where Metro had a home.

YES - Tim Radcliffe, Associate director, Starcom
With thelondonpaper's demise, the portals through which to reach 18 to 34-year-old Londoners have decreased dramatically. And from a planning point of view, especially within print, the Lite shutting would be a difficult hole to fill.
 
For agencies and advertisers trying to reach this valuable audience, it would be sad indeed. Without the- londonpaper, the road seems clear for Lite to pick up readers, increase circulation and pricing. On the flip side of the coin, it would be understandable if Associated looked to shut the Lite.
 
Apart from an altruistic need to give advertisers access to valuable readers, there would be little reason to keep a paper running if it was losing money at the speed thelondonpaper was.
 
As a spoiler, the Lite has served its role and with NI deciding the free media model is unsustainable, it would indicate the financial future for the Lite seems bleak as well. If it doesn't change and aim for the long game, then shutting it now would be the best option.

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