The US Once Again Has Two International News Agencies; The UK Now Has None

Philip M. Stone April 28, 2011 Follow on Twitter

Recent editorial changes have solidified what was already a reality – that Reuters, the great British news agency that got its start two centuries ago by its German founder flying news across Europe via carrier pigeons, is no longer British. As Thomson Reuters it has become as North American as apple pie.

That’s not necessarily a bad thing. The Thomson family, as the richest in Canada, have oodles of money to ensure that Thomson Reuters is the best at whatever it does and in owning a controlling 55% of the news agency now carrying their name they’re not worried about shareholder revolts if results are not up to snuff because of heavy investment. Of course it should be remembered that rich families got that way because they didn’t recklessly throw their money away, but the company in recent days has made major investments in senior editorial personnel who didn’t come cheaply and assuming they perform to their pay slips then the boardrooms of the Associated Press (AP) and Agence France Presse (AFP) should be worried.

This change has brought about a new world order in international news agencies. Until the 1980s there had been two powerful US news agencies – The AP and United Press International (UPI), but then the E.W. Scripps Company decided it was fed up with UPI’s annual losses, and there were family inheritance problems to work out, so it dumped UPI for nothing upon a couple of guys from Nashville, Tennessee – in a few years they brought it to bankruptcy, followed by more bankruptcies and foreign ownership (Mexican, Saudi, Korean) and the bottom line is that UPI is no longer a media household name.

So AP, Reuters and AFP were left to carve up the world. While all were present everywhere, the AP’s strength obviously was North America, whereas the British Reuters was strongest in Europe and AFP cleverly carved out a compelling niche in Asia, even though it had to do so with its English language service which was not exactly what government circles in Paris wanted to hear.

Most publications in Europe wanted to subscribe to the European Reuters news agency, and if they could afford it also to AP for its fast complete news and pictures of the US which the other agencies just could not match. AFP fit in, too, usually by offering very low rates.

The “European” brand for Reuters cannot be over estimated. European publishers wanted a “European” news agency – or to put it more bluntly, an agency that was not pro-American (although AP staffers would no doubt object to that characterization). But the truth on the ground was that Reuters was seen as the European brand and AP was the American brand, but since Reuters had no way of matching AP’s US coverage, they both found financial support.

But now what? Reuters is no longer “European”. Its new senior editors all sit in New York. Their backgrounds are prestigiously steeped in American journalism. Reuters is no longer listed on the London Stock Exchange – its shares now available only on New York and Toronto markets. And CEO Tom Glocer, who headed up Reuters before the Thomson takeover, was very clear to his staff that the buyout was not a merger -- it was a Canadian takeover with headquarters moving from London to the US.

So, while Reuters can still boast about its editorial credentials – and that after all is what should win the day, day after day – it can no longer rest on the laurels of being European. Those days are gone. So while the German dpa or the Italian ANSA may want to lay claim to being “international” the only truly real “European” international news agency remaining is AFP. Can it take advantage of that branding with its European clients or is the stigma of French government support too much to overcome?

That Reuters is no longer British doesn’t mean that the British influence in world media coverage is entirely gone. BBC World Services on radio and television are seen and heard all over the world and doubtful there is a stronger brand around. And online it seems the UK’s Daily Mail is making a strong run at being the world’s most frequently visited newspaper web site. The New York Times holds that honor right now, but the Mail is gaining visitors while the NYT is losing visitors because of its new pay wall so the question now is how long it will take before those two lines cross on the graph.

What may be of greater interest in the new world news agency order is what Thomson Reuters now intends to do in its own domestic market – The US. The reason the AP has done so well internationally is because of its US coverage – sure it has great international coverage but what sells it to the rest of the world is its US coverage. AP has its domestic market covered solid and no other agency previously could afford the investment necessary to match that product. But Thomson Reuters could, if it wanted to.

Already last year it announced a US investment with its Reuters America service aimed at providing US publishers state-by-state general and political news, coverage of top professional and college sports plus business news, financial data as well as entertainment, lifestyle and feature stories. First to sign-up was Tribune.

The AP, of course, has troubles on its own domestic front with newspapers complaining of rates being too high – hard to feel sorry for those complaining editors and publishers for they (or their predecessors) allowed UPI to cease being a strong number two by withdrawing subscriptions, and once AP had the market to itself what did those editors and publishers think would happen?

Now if Reuters comes along with a proven domestic quality product that satisfies local, national, and international needs at a lower price than the AP, then could there be trouble ahead for the premier domestic American news agency? And if that Reuters US domestic coverage is good enough to satisfy international subscribers then they could well decide in these hard times they don’t need the AP for US coverage and that could really give AP financial pain.

Reuters had an opportunity in the 1980s to have EW Scripps pay it to take over UPI, but management at the time feared of getting involved in “parochial” US coverage. Just how deep Thomson Reuters management decides it should go now in its US coverage could mean a whole new ball game in the US news agency business.

See also in ftm Knowledge...

Television News - Bright Lights, Big Coverage

The global reach of television news has never been greater. The digital age has expanded that reach to satellite channels and the Web but it has also forced television news to mature. This ftm Knowledge file shows the gains and the pains. 74 pages PDF (December 2010)

Order here