Saki’s side

Damn. Sakis bursting my bubble. And this is inner bubble at that, last-hope bubble. For a long time I tried to believe that the new breed of shooting-star super-execs were adding value wholesale. Through a long litany of let-down I have had to pare down the wholesale and have wound up with a modest list of individuals who I do believe are adding value. High on this list is the name of S. Macozoma, esq., chairman of Nail.I know what public opinion says about Saki, viz, look, he messes up SAA and now they give him Nail. Shows you. But I also know (like [plug] anyone who has read my book Jetlag) that in this instance public opinion is even more cocked up than usual. What the SAA affair truthfully said about Saki is that here is someone who can (a) make a decision and (b) carry it through. Neither of these attributes being in oversupply, I have faith in Saki and high hopes for him.Now it is half past three and I have enjoyed thirty-one minutes solitarily contemplating the waiting room dcor at the Hyatt business centre. I accept that the capacity to make a meeting on time is not the sole, or even principal, criterion of executive ability. But it is a prima facie clue, and I am disappointed that Saki is not here. By 3.30 I have the dcor well waxed. The world begins to lose its grip. I drift into a dreamy dream about a future South Africa where appointments work.From which I am jolted by a hand jogging my arm. This is a courteous sort of a jog, I detect through the mists. It is followed by Sakis voice saying Denis, Im so sorry. Ive been waiting for you on the 8th floor.Which unbreaks the bubble, albeit at the price of a nagging worry about how a confirmed and re-confirmed meeting, time and place initiated by Nail, acquires two venues.While Sakis apology is handsome, by the time were composed, seated, and through the coffee-cups ritual, it is a quarter to four. Sakis next date is at Anglo American at 4.30. Anglo American is 28 robots away, at an average 150 metres. Saki must leave at ten past, or quarter past, latest. I take it he has acquired Michael Schumacher as chauffeur, but my business is not Sakis diary. My business is finding out what hes up to.Hes having a torrid time at Nail, looking for something to buy with the half-a-billion-odd rands weighing down his piggy-bank. The window-shopping was fun enough. Kagiso, with pretty radio stations that could make a cheerful audio empire. Johncom, bristling with complementary print titles. But the National Interest said he couldnt have Kagiso, and Johncom valued its titles at rather more than he (or anyone else) did. And even while Nail is breathing ash from the fallout of its spurned offers, the home front is smouldering with the fires of vanishing customers.Why not focus on chewing what Nail already has, rather than biting off more? SAKI sighs the sigh of someone whos been asked the same unwelcome question a few times too often. You mean the Sowetans circulation, he says, everybody goes on about that. Allow me to point out one thing, which is that the Sowetan has just doubled its profits. The year to March 2003 will show an increase of about 100 percent. That is probably an unrepeatable feat. It is a thing for people to keep in mind when they tell me that the Sowetans circulation is such a disaster. Circulation is worrying, that is true, but dont lose sight of the other side.On what is the new figure 100 percent up? On last years profit, R7 million.Which is vastly lower than the R30 million-odd of three years ago? Lower, Im not sure about vastly and I dont recall the figures. The point is, we have an entity moving purposefully forward on important fronts. Circulation trouble is not its only feature.Point taken. But insofar as it is a feature, how do you explain the wiping out of 80 000 buyers, a third of your total?Look, the new competition, the Sun, is effectively a freebie. Theyre selling it at one rand. This is uncompetitive behaviour by Naspers. In fact I believe Terry (Moolman, of Caxton) is taking it to the Competition Board. You cant use profits generated by one product to sustain another product which is designed to affect a competitor. Look at the windfall Naspers gets from that strange agreement with government, that lets them benefit from Open Time on a pay TV channel. Its wrong if those profits go into killing competing newspapers.That is, youre blaming the Sowetans fall on the Daily Sun?No, not wholly. We accept that locating the Sowetan as a middle-class newspaper has implications on circulation. Thats alright. The Sun can have circulation, well have profits. I mean, a person buying a paper at one rand, what disposable income does that person have, what aspirations?But youre miffed at Naspers pulling this stunt?Their strategy with the Sun is not the right way to do things. That does not mean were at war. Koos Bekker is a very innovative person. You never know. Maybe some time in the future we find there are deals we cant do with other people, we do them with Naspers.Deals, deals, have we lost the days when a company went forth and built new products? In media, its very difficult to build from scratch. You have to have scale. Im just back from a conference in Europe, on media management. You cant believe how different it is. There, theres an understanding that business does what business must do. Here, you ask yourself Can I do this? Can I do that? The answer is Ah, I must ask Icasa. So Icasas veto of your Kagiso deal rankles?Yes. That decision was inexplicable, and its reasoning was flimsy to the point of being judicially reviewable. It could only have come from a very ideological body, paying much less attention to the broadcasting side of its mandate than the telecoms side. Icasa can only see Empowerment one way, which is that every little town has its own little radio station, thousands of little entrepreneurs have their own little media organs. They should know by now that this is a formula for multiple bankruptcies, but they would rather perpetuate their cherished myth than have a proper company move in and run things so there is scale, so there is growth, so there is profit. They frustrate vital investment.Is that a consequence of their mandate?No. They have the power to vary the regulations if good cause is shown. Good cause has been shown, but they lack the courage to do what they know they need to do. They worried that your Empowerment credentials were lacking.Their view is warped. If Nail is not an Empowerment company there is no Empowerment company on earth. They wanted us to give them the complexion of every person who buys a Nail share, which we think is silly.And the Johncom deal?It would have been the perfect fit, on three levels. Co-owned presses would mean more usage for the presses and better deals for owner-users. Back office synergies would mean fuller utilisation of management and support staff. Complementary titles would mean buttoning up the middle-to-upper market. To get better than this is not possible. It is tragic that it has not happened.Which leaves Nail where?One logical extension is Outdoor. You want to show the advertiser you can run his whole campaign. You become a one-stop-shop. What someone is hearing on your radio as he drives is reinforced by astute use of your billboards and your newspapers. We bought three outdoor companies, Natanya, Randata, and Significant Signs, which runs the old tobacco billboards that the tobacco companies may no longer use. Were the third biggest outdoor company, and may soon be the second.Hm, I never located newspapers and billboards in the same breath. Now I see a logic. Still, your central business remains processing the written word, and notwithstanding the doubled profit there are suspicions of a corporate death-wish on the go at the Sowetan.Notwithstanding the doubled profit there are suspicions of a corporate death-wish on the go at the Sowetan. From what?The paper is late every day; the top guys are in civil war; you allowed it to run down for years without an editor; copy is often illiterate and sometimes mangled. And your loyalists are running away from your fixation on making them middle class.Mmm. Be clear on one thing, the middle-class fixation is entirely right. Anyone who eschews the black middle class is foolishDoes middle class include you?No, people like me, Cyril, a lot of people have gone beyond there. I dont want the Sowetan to reflect my view. I might be interested in whats happening in private schools, my readers are interested in government schools. Theyre interested in self-advancement, things like that. That class is what must expand. That class is where the money is. This paper, the Sowetan, is going to be the chief vehicle of the black middle class. In that capacity it is going to be crucial to this nation, and is going to be read by all decision-makers. I said all decision-makers, never mind colour, class, anything. All. That hasnt exactly happened yet.Its beginning. Theres some distance to go. We do not have a strong tradition of debate and ideas in the print media. Listen to the radio talk shows, you have debate ad nauseam, but you dont really see that in print, where it matters most, where ideas germinate and develop. The middle class is the natural generator of ideas, generator of advance. The Sowetan is creating the platform for that generating to take place.It is not easy. There is the legacy, the education, the values instilled of old, it is difficult writing not in your mother tongue. I am optimistic that improvements in education will solve many things. I am optimistic that the middle class will grow. I know that we will be there for them. We cultivate the black middle class because that is our commercial duty, that is what will sell newspapers, but we see beyond that too, we see what strengthens our society.Theres not a lot of arguing with that. Personally I hate businesss passion fad, with every chief exec telling you all the time how passionate his staff are about the invoices they dispatch or the loos they clean. Its nearly always bogus. But heres something different. Saki never once uses the word passionate. He just is passionate, believing what hes doing. My other mutters about the Sowetan, Saki buys. The standard of journalism is unacceptable. There are fundamental mistakes in grammar and syntax. Yes, it is late all the time, partly because previous management negotiated impossible deadlines. The editor and the manager are possibly not pulling fully together (Saki is supposedly uninvolved but has been somewhat drawn in, as no-one else has the wherewithal.) The distribution system is having a hard time following the readership out of the townships into the suburbs. (Couldve fooled me; my leafy suburb has more Sowetan posters than Stars or Citizens). Saki has defences, but doesnt argue that the place is askew. He argues only when I say that the Sowetan has a sick obsession with exaggerated whites-do-us-dirt stories. By 4.20 Im feeling guilty; how sick is that? Its his appointment in town, and Im on edge about keeping him from it. Would I be on the same edge if he was Jones or Van der Merwe? Theres a PhD in there somewhere. He gets going; new larney 4×4; he seems to have dropped the personal number-plates he had on his old top-of-the-range Merc. Theres a transcending of middle-class mentalities for you. Last question, its been on my mind, why did we meet here; am I somehow not welcome to darken his office doorstep? Saki looks hurt. No, he says, Im miles out north, and I was going to town, and I knew you were near here. Theres disarming, and considerate. Next time we just need to clarify floors. Faith remains intact and so do the hopes. My first real boss, Hal Miller, was a predecessor of Sakis as Admiral of the Media. His most enduring lesson was make decisions and stick to them. A wrong decision is less bad than no decision, a wrong course is less bad than a wavering course. Saki might have been eavesdropping. May his course turn out right. May the managing decisions of the imminent future work out better than the buying decisions of the recent past.

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