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NS Profile - The Financial Times
Published 21 October 2002
Don't be fooled. There may be a ban on expense-account lunching but the pink paper remains in the pink. The Financial Times profiled by David Cox
Britain's press can often seem consumed by triviality, hysteria, partisanship and braggadocio. There is, however, an exception. The pink pages of the Financial Times harbour only truth, reason, civility and intelligence. A copy will set you back £1, but for that, you'll get events reported, analysed and contextualised calmly and incisively by the world's best journalistic team. A bargain? Or a bloody miracle?
While the rest of Britain's cultural sector lags globally, the "Pink 'Un" is conquering the world. Two-thirds of its sales are now overseas. America and the Continent get dedicated editions, while Germany has an own-language paper as well. The FT is a more potent global voice - in influence if not numbers - than the BBC's World Service.
Not bad, huh? Unfortunately, newspaper readers, like the rest of humanity, are ungrateful sods. Even the peerless FT has its critics. If it's such hot stuff, why doesn't it get more scoops? Why are its leaders so feeble? Where's its investigative journalism? Why didn't it warn us about the dotcom bubble or Enron? Why isn't it more critical of the businesses it covers? Or, alternatively and not necessarily contradictorily, shouldn't it be championing its constituency more effectively, as capitalism falls out of favour?
To such complaints, the FT has always had answers. The criticisms are unfounded. Or, in so far as one or two of the criticisms may be just a little bit founded, what do you expect? The paper is, after all, a commercial operation. If, in order to stay afloat, it must avoid rocking the boat, so be it. Would you rather see its finances imperilled, and its matchless journalism jeopardised? Suddenly, such an eventuality no longer looks wholly fanciful.
The FT's latest half-year results show profits falling off a cliff - down from £32m to £7m, with the current global downturn yet to take its full toll. The paper's owner, Pearson, is in no position to take a relaxed review of this calamity. Five years ago, Pearson's chief executive, Dame Marjorie Scardino, promised to double the share price by this year. She has failed completely, and the former golden girl is now in the City's doghouse.
Today, the FT's sepulchral HQ on London's Southwark Bridge has lost its air of timeless imperturbability (or, if you prefer, smug superiority). In its place has come a tense, even tetchy, mood. Hitherto unfamiliar concepts like budget cuts, hiring freezes and redundancies have swum into baleful view. The paper's perky Saturday magazine, The Business, has been axed. Now, the unthinkable has come to pass: entertaining on expenses has been banned.
Even so, it's far from clear that mere belt-tightening will save the day. The fashion in these dark commercial days is for concentration on core businesses. Pearson is essentially an educational publisher - the world's biggest. It has already got rid of its television arm. There is no real synergy between the textbook and newspaper businesses, and at a recent press conference, Dame Marjorie appeared to contemplate selling off the FT. The pre-eminence that the paper has achieved would make it an attractive purchase, but would Pink Exceptionalism survive under the kind of buyer the paper might attract? Is the Financial Times doomed to conform sooner or later to the grim practices of what are known disdainfully on Southwark Bridge as "the white papers"?
The character of the FT depends on unique methods. High-flyers, selected in their twenties, often stay for life. Their working environment has more in common with an Oxbridge senior common room than a Wapping newsroom. FT reporters become authorities on the fields they cover. They are trusted to write what they believe to be true, rather than what will support a preconceived line or reinforce the supposed prejudices of readers.
This approach springs naturally from the paper's origins. Financial journalists know their words can move markets; getting it right matters more than making a splash. As an information tool rather than an entertainment vehicle, the FT has been spared the attentions of megalomaniac press barons eager for mass readership or political influence. Its course has therefore been steered not by colonial buccaneers like Beaverbrook, Murdoch or Black, but by a very English breed of fastidious gentlemen.
The current paper was created through a merger of two long-standing rivals in 1945. Characteristically, the first editor of the merged paper identified his goal as making the paper so impregnable that no newcomer could possibly catch up with it. His strategy has succeeded. Though there is always talk of someone launching a rival, no one has actually dared to. The paper's resulting monopoly has freed it from the need to cut costs to sustain profitability or to dumb down to protect market share.
Monopoly has also provided the FT with a secure base from which to spread its wings. Once it had saturated the financial market, it used the sector's succulent revenue to creep into general news and features. At the same time, Britain's erstwhile "newspaper of record", the Times, and the other "white" broadsheets were going populist. Without anybody noticing, the FT quietly emerged as the country's top serious newspaper.
For the paper's bosses, this was not, however, enough. Their dream of a global newspaper was dismissed by some as hopelessly presumptuous, but the plan worked. After the merger in 1945, circulation stood at roughly 50,000. Today the paper has 1.5 million readers in 140 countries, and sales have been growing at 10 per cent a year for the past five years. Three million people a month visit the paper's magnificent website.
Expansion on this scale might have been expected to divert energy and resources from quality control. However, this was not an option. Though the FT may be unchallenged in Britain, overseas it faces a mighty rival in the Wall Street Journal, which has its own imperial ambitions. To compete with the WSJ, the FT has had to invest even more heavily in journalistic strength. As a result, it now has 500 journalists working in 65 countries. British newspaper readers have been incidental beneficiaries of this amazingly comprehensive coverage.
Naturally, the FT's grand ambitions looked cleverer during the global boom of the 1990s than they do today. Inevitably, what then looked bold can now be seen as hubristic. Mistakes have certainly been made. From the beginning, the Wall Street Journal charged for access to its website: it now has more than 600,000 paying subscribers; ft.com, on the other hand, offered free access at first, then belatedly tried to charge for some services. So far only 20,000 users have proved willing to cough up. Unsurprisingly perhaps, Germany's notoriously conservative newspaper readers have been slow to warm to their new pink paper.
Will Pearson cut and run? If so, a new owner would face an obvious temptation. Bring in a tough conventional manager, dump staff, cut other costs to the bone, scrap peripheral operations and direct what are still impressive revenues straight to the bottom line. The figures might make this look like a miraculous rescue job. It would, however, extinguish the FT's unique culture.
Would that really be such a loss? It would. The knockers' case is not that strong. In truth, the FT has plenty of scoops. It's just that they are not flaunted, but tucked away inside, whence they are often nicked to reappear on other papers' front pages. If the leading articles seem a bit wet, that's because they reflect collegiate wisdom, rather than proprietor-inspired prejudice. The dangers of dotcoms were signalled clearly enough by the paper's brilliant business columnist Peter Martin, now sadly claimed by cancer. Enron? That was a pity, but at least the editor responsible, Richard Lambert, has had the decency to breast-beat about it.
Dame Marjorie has announced that however her earlier remarks may have been interpreted, the FT will be sold "over my dead body". The paper's journalists are therefore toasting her health, in spite of another statement, also since revised, in which she appeared to endorse criticism of them. In fact, the Dame's enthusiasm for her newspaper is not in doubt. Whether she can hold on to it may depend on its immediate performance.
Under Lambert's successor, Andrew Gowers, expansion continues. A new Asian edition will go ahead next year. The paper is becoming more urgent and newsy, inevitably putting its cherished reliability at risk. There are those who see this development as a regrettable departure from the more cerebral approach of the past. It is true that the paper has lost the Olympian tone provided by long-gone commentators such as Barry Riley and David Watt. Yet it is covering an important flank, as the news market grows ever more frenetic. For the moment, at least, the Pink Paper is in the pink, whatever its financial problems. Those who value serious journalism must hope that it remains so.
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