Last month, Peter Baillie, publisher of the Victoria Times Colonist, was invited to speak to a local group of retired corporate executives. The subject? Canada’s newspaper war.

It might seem a little hard to imagine the daily newspaper publishing industry as a topic of café conversation – but that’s precisely the way things have been since Southam launched the National Post in October 1998. "There really has been more interest in and dialogue about the nature and shape of newspapers today – more than I’ve seen in a long time," Baillie says.

Actually, that’s not quite accurate. The attention that Baillie describes has been focused largely on the machinations of the big Toronto-based dailies – to the point that an outsider might be forgiven for believing that these papers are the only ones in the country.

They’re not, of course. And one can’t help wondering: What do dailies in Canada’s smaller cities make of the whole newspaper war? Has there been fallout – either good or bad – for them?

Baillie, for one, argues that the launch of the Post has been good for readers, because it has forced other papers to rethink how they deliver the news. "It has really raised the bar," he says.

The Times Colonist itself has made a number of improvements in the recent past. The Hollinger-owned daily switched to a better printing press, and mounted a $400,000 brand campaign in early 1998 that emphasized its role as the number one provider of local news.

Thanks to these efforts – and a healthy Canadian economy – the Times Colonist has managed to avoid losing readers since the launch of the Post. In fact, it has enjoyed circulation gains in at least 19 of the last 24 months.

The presence of the National Post has definitely raised overall awareness of the newspaper industry, says Larry Hooper, director of advertising for the Kitchener-Waterloo Record. However, the heightened interest on the part of advertisers has more to do, in his opinion, with the robust economy and the growing fragmentation of TV and radio.

The Record – which used to be part of Southam, but was sold to the Torstar Daily Newspaper Group to make way for the Post – has so far succeeded in maintaining market share. The paper has a circulation of approximately 70,000 Mondays to Fridays, and 90,000 on Saturdays.

While the competitive arena may be tougher now, Hooper predicts that local dailies will continue to hold their own. "National papers can provide an enormous amount of information," he says, "[but] they can’t do a local section."

Prompted in part by the increased competition for national advertising dollars, the Torstar Daily Newspaper Group now has a national salesforce in Toronto that sells for all five papers under its umbrella: the Record, the Cambridge Reporter, The Guelph Mercury, The Hamilton Spectator and, of course, The Toronto Star. The strategy seems to be working: According to Hooper, national advertising has grown 30-35% annually for the past three years.

The Record plans to introduce a complete redesign this coming September, which is when the daily switches to the Torstar printing facility in Vaughn, Ont. – a move that will afford greater flexibility in terms of colour and design.

Just about every major daily in the country, Hooper says, has been compelled to put a focus on improving its product since the Post entered the marketplace.

Susan Muszak, general manager of The London Free Press, agrees. "It has forced other newspapers to come up a notch or two," she says.

The Free Press (which is read by six out of 10 people in the London, Ont. marketplace) has kept its circulation stable since the newspaper wars began, thanks in part to a significant investment over the last couple of years in improvements – notably the launch of a Sunday edition and the introduction of more special sections. And Muszak is confident that the paper will continue to hold steady, for the simple reason that it offers a product very different from the national dailies.

"If somebody is buying the National Post or the Star or The Globe and Mail, they’re a newspaper reader – and chances are that they’re also buying The London Free Press," she says.

Laurie Finley, director of marketing and advertising for the Winnipeg Free Press, says that his paper has lost a small percentage of its Saturday readers since the Post entered the marketplace. He has also noticed reduced growth in national advertising dollars. And while it’s difficult to diagnose this kind of symptom with any degree of certainty, he says, "it could be the advent of another product out there that’s after the same dollars."

Last year, the Thomson-owned Free Press opened a sales office in Toronto to get its message out to national advertisers. The paper has also made a number of design changes. "We cleaned up the look," Finley says. "It’s more of a magazine look."

If nothing else, the newspaper war does seem to be having an effect on the aesthetics of this country’s dailies. A number of papers in smaller centres have recently revamped their look, or are in the process of doing so now.

The Montreal Gazette, for example, is in the middle of a $60-million move to offset presses – which will create a cleaner and more colourful paper – and is planning a redesign as well.

The Leader-Post in Regina, Sask. is also making some design changes, based on the results of a readership survey last fall. But general manager Greg McLean says it’s the Leader-Post’s focus on local news that will allow it to thrive while the national newspaper war rages on.

Some subscribers who are interested in national or international news may stray, he says – but they’ll be replaced by people who want to read more about local issues.

Ken Seguin, publisher of The Sudbury Star, takes a similar view.

The newspaper war, he says, is something happening far away in Toronto. In his market, there are local advertisers who need a local paper – and that’s what the Star is.

"We’re makers of our own destiny," he says.

Also in this report:

– Flying blind: Without knowing the answers to some pretty fundamental questions about newspaper readership, media buyers are forced to make their decisions based on assumptions, not facts. And that’s not good enough, says one expert. p.B16

– NADbank building on solid base: Newspaper readership study evolving in dynamic market p.B18

– Spotlight on Newspaper Creative p.B23