Australia's two largest newspaper publishers News Ltd. (NWS.AU) and Fairfax Media Ltd. (FXJ.AU) Monday downplayed reports that both are preparing for significant changes to their existing print business strategies.

Fairfax, publisher of the Sydney Morning Herald and Australian Financial Review, declined to comment on a report in the Australian newspaper that its board of directors has discussed stopping printing its major newspapers through the week and instead focusing on a wholly digital strategy.

A spokesman for Fairfax denied the company was planning to end its weekly print paper editions and said the company "continues to focus on profitable circulation and growing its large multi-platform audience."

The company has struggled recently in the face of a weak advertising market and has announced plans to cuts costs by 85 million Australian dollars (US$83.9 million) by the fourth quarter of fiscal 2013. Its share price dropped to a new record low of 62.5 Australian cents on May 18 but has since recovered to close up 3.2% at 64.5 Australian cents Monday.

Jason Beddow, chief executive of fund manager Argo Investments, which holds Fairfax shares, told Dow Jones Newswires that while "at some point in time" media companies may stop publishing newspapers, "I don't think we're there yet."

At the same time, The Age newspaper - owned by Fairfax - reported Monday that News Ltd. plans to fire 400 editorial staff as part of a strategic restructuring to be announced next month. News Ltd. is a unit of News Corp. (NWS), owner of Dow Jones Newswires and The Wall Street Journal.

"It is not News Ltd.'s practice to discuss internal organisational matters and general operational initiatives in public and so we will not be providing a running commentary," a News Ltd. spokesman said in a statement.

News Ltd., which publishes a host of newspapers in Australia including the Australian and The Daily Telegraph, is undergoing a "substantial transformation" and "as we work through internal initiatives we will always work with our staff to ensure that changes are made with care and with a view to minimal disruption as we transform the company," the spokesman said.

Newspaper companies around the world are trying to work out how to make money in an increasingly digital world as circulations rates drop away and readers switch to the internet and tablets for their news. Audit Bureau of Circulations figures released earlier this month showed weekday circulation in the three months to March for News Ltd.'s flagship newspaper, the Australian, fell 1.6% on year, the Daily Telegraph fell 1.4% and the Herald Sun fell 3%. Weekday circulation for Fairfax's the Age fell 13% for the same period while the Sydney Morning Herald fell 14%.

 
   -By Gavin Lower, Dow Jones Newswires; 61-3-9292-2095; gavin.lower@dowjones.com
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