Also content revenue and advertising sales for print media declined in 2014. The Regional Media segment’s advertising revenue totalled MEUR 62.5 (66.5), which represents a decrease from the previous year of 6.1 per cent. Print media advertising revenue declined by 6.7 per cent, but the segment’s online advertising revenue grew by 10.8 per cent to MEUR 2.1 (1.9). The segment’s content revenue was MEUR 65.5 (67.6), down 3.1 per cent, mainly due to the decrease in print media circulation.
The response to the decline in the profitability of print media involved cost savings, efficiency improvements and digital development.
Moving forward towards digitality
For Regional Media, 2014 was characterised by efforts to improve efficiency and strengthen digitality in both working methods and services.
Several developments were made to serve advertisers and consumers as they shift to digital channels. Alma Regional Media recruited the unit’s first Director of Digital Business in the third quarter. Late in the year, the segment also launched a special project to increase its digital competence. The development project covers Alma Regional Media in its entirety and is aimed at increasing digitality in business. Personnel have a central role in this effort, as they are challenged to take part in the planning of digital business. The needs of active media consumers are the basis for the development of renewed business models, operating culture and expertise. The project will last for approximately 18 months and it has received funding from the Liideri programme of Tekes - the Finnish Funding Agency for Innovation.
The segment’s response to the digital transformation and changing consumer behaviour also included the development of multi-channel content. Aamulehti began a project for launching Hetki (“Moment”), a new paid digital afternoon edition. The new digital edition was released in January 2015. Hetki complements Aamulehti’s digital product offering by adding a new consumer product for the afternoon, the time of day when the news stories covered in the morning paper are due for an update. Alma Regional Media’s other regional and local papers also continued to develop their paid online services. For example, Pohjolan Sanomat and Aamulehti implemented a partial paywall at the beginning of 2014, and Kainuun Sanomat followed suit in March 2014. Alma Regional Media’s video production took significant leaps forward by organising video training and harmonising video platforms across the segment’s various papers.
Renewal also continued on the print side, for example in the form of Aamulehti’s switch from broadsheet to tabloid format. The tabloid renewal involved changes in the newspaper's content, structure, supplements and design. The renewal was carried out with extensive input from readers, and feedback was also collected after the renewed Aamulehti was launched. The first tabloid-format Aamulehti was published on 1 April 2014. Alma Regional Media’s other regional papers had already previously adopted the tabloid format.
To improve the profitability of regional publishing operations and ensure the quality of content, Alma Media and five other Finnish newspaper publishers established Lännen Media. The newly established company improves journalistic cooperation between newspapers in western and northern Finland and enables shared content production for printed papers as well as the digital, online and mobile channels. The founding newspapers of Lännen Media include the Alma Media newspapers Aamulehti (Tampere), Satakunnan Kansa (Pori), Lapin Kansa (Rovaniemi), Kainuun Sanomat (Kajaani) and Pohjolan Sanomat (Kemi), the Ilkka-Yhtymä newspapers Ilkka (Seinäjoki) and Pohjalainen (Vaasa), Hämeen Sanomat (Hämeenlinna) and its affiliate Forssan Lehti (Forssa), Turun Sanomat (Turku), Kaleva (Oulu) and Keskipohjanmaa (Kokkola).
The printing and distribution company Alma Manu Oy, which was previously reported under the Other Operations segment, became part of the Regional Media segment in March 2014. The purpose of this rearrangement is to increase collaboration between Manu and its largest customer, Alma Regional Media, as well as to improve the use of resources.
There were many changes in Alma Manu’s distribution operations during the year. Itella (nowadays Posti) discontinued many of its early morning delivery agreements across Finland, which led to the early morning delivery of newspapers being transferred to new service providers. Distribution in a small area in Tornio was transferred to Alma Manu in the summer. Already before that, Alma Manu had handled the early morning delivery of some newspapers, including Aamulehti, Pohjolan Sanomat and Lapin Kansa. In order to improve the profitability of distribution operations and to maintain its service level, Alma Manu applied for and received a postal licence from the Finnish government for letter deliveries in Pirkanmaa and Satakunta. The licence authorises Alma Manu Oy to provide postal services to contract customers in the geographic area covered by the licence. Alma Manu also reorganised its distribution and transport network in the third quarter and joined forces with the major Finnish newspaper publishers in the fourth quarter. In October 2014, Alma Media started to investigate together with Sanoma Media Finland, Keskisuomalainen Oyj, TS-yhtymä, Kaleva Oy, Mediatalo Esa and Länsi-Savo group the possibility of establishing a joint venture with the aim of developing the co-operation between early morning delivery service providers and their logistics as well as to manage the nationwide sales of delivery services. The aim is to create a system for the early morning delivery network of newspaper publishers so it could take on more material to deliver and to ensure high-quality and cost-efficient operations.
Due to weaker-than-expected performance, Regional Media reached an agreement in the second quarter on savings in annual personnel costs of approximately MEUR 1.5 for 2014. The savings were achieved by temporary layoffs and by exchanging bonus holiday pay for days off.