The Indian Express - Financial Difficulties and Turnaround

Financial Difficulties and Turnaround

The newspaper saw falling profits between the years 2000-2002 but did not change its policies and the nature of content it carried. The newspaper, however, appointed franchisees to run some of its loss making editions including the Jammu edition (the model was also adopted to launch the Chandigarh edition of The Financial Express - the business paper of the Express Group). Under the franchisee model, the editorial control of the edition was to be retained by the editorial staff appointed by the Express group. The franchise owner was given the control of with the business side, including circulation and generation of revenues. In return the franchise was expected to provide the operational expenses and a one-time fee to the Express group. The model looked good on paper. However, it led to dilution of the editorial standards as the franchisees sought greater say in the appointment of reporters and selection of content. The conflict between commercial interests and journalistic ethics reached a flashpoint in The Financial Express, Chandigarh edition, when the franchisee threatened to shut down the edition if he was not given the editorial control. The franchisee ultimately emerged as the winner,leading to the resignation of the Resident Editor of the edition. This was followed by fresh appointments to the Editorial team and the franchisee assuming the role of the Managing Editor.The Express Group, subsequently posted profits of Rs 45 crores in 2004. This financial turnaround has been used as a case study in India's highly regarded Indian Institute of Management in Ahmedabad.