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More than 500 jobs to go at Fairfax -

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TONY JONES: The Sydney Morning Herald and The Age have delivered some bad news to their staff.
Fairfax Media today axed 550 job saying advertisers and readers were shunning traditional
newspapers. Fairfax management say the cuts will not affect the quality of the flagship newspapers,
but the staff are not convinced. As John Stewart reports, the announcement came just days after the
company unveiled an annual profit of almost $390 million.

JOHN STEWART, REPORTER: Fairfax staff had been expecting job cuts, but not this big. 550 jobs will
be axed, one third editorial positions. Newspapers like the Sydney Morning Herald and Melbourne Age
could lose up to 10 per cent of their reporters.

JASON SOUTH, PHOTOGRAPHER, 'THE AGE': There's a lot of editorial staff who are going to get the
chop which is really disappointing because the masthead and the brand is sold on quality

JOHN STEWART: Like many traditional media companies, Fairfax is losing readers and revenue to the

DAVID KIRK, FAIRFAX MEDIA (via teleconference): We have to be a leaner more agile fundamentally
different company if we are going to succeed in the modern media world.

JOHN STEWART: The Sydney Morning Herald and the Melbourne Age are among the most respected
broadsheets in the country. The newspapers are regarded by many as important cultural institutions,
recording social and political events for well over a century.

DAVID MCKNIGHT, UNIVERSITY OF NEW SOUTH WALES: Newspapers like the Sydney Morning Herald and The
Age are not just businesses like any other. They are also social institutions and they are
watchdogs for the public. So any damage to their editorial side really has big implications for the
rest of journalism and for the society as a whole.

JOHN STEWART: Today Fairfax management claimed the job cuts will not reduce the quality of
journalism in their newspapers.

DAVID KIRK (via teleconference): For a range of structural and other reasons we can be more
productive and it'll have absolutely no impact on the quality of the papers.

JOHN STEWART: But media commentators are sceptical, saying investigative reporting will suffer.

DAVID MCKNIGHT: Quality journalism takes time; it's an investment in research and digging up things
that may lead nowhere. And the fewer journalists you have to do that the harder it is. I mean, the
problem is that journalists maybe become even more kind of stenographers and mere reporters instead
of investigators.

staff of the Sydney Morning Herald are now gone over the past few years. Now you can't cut your
staff by that number, you can't reduce your quality content by that amount, and not have the
quality of the product affected.

JOHN STEWART: Fairfax management say that a number of newspaper sections and special reports will
be outsourced. The company hopes to save $50 million a year, and analysts predict even more cost

ROGER COLEMAN, MEDIA ANALYST: They've just cut labour costs mainly in editorial. There's a lot of
other costs they can cut.

JOHN STEWART: It's unclear exactly which traditional sections of the broadsheets will be axed in
the shake-up.

John Stewart, Lateline.