Nation Group Crisis: How Serious?

For years any visitor to the old Nation House (along Tom Mboya street and opposite the Fire Station) would not have missed the aura of arrogance and invincibility that was very much present at Kenya’s highest circulating daily newspaper. Reporters walked with their heads high and enjoyed the effect that they got from the public whenever they introduced themselves as being from “The Nation.”

Well, we are told that pride comes before a fall and those who have been rubbed the wrong way by this arrogance have been waiting for the downfall of the Nation in vain. Instead the newspaper has grown into a multimedia giant stranding the entire region. But now, according to information and alarming figures that I have had the privilege of looking at, things have never been so bad at the Nation. The Nation group I am afraid is struggling and will face some very tough decisions in the very near future. So critical are these upcoming decisions that one wrong move could easily bring down this giant media company.

But what exactly went wrong?

Actually two major factors.

Firstly rapid changes in the way people receive news which executives at the Nation group brushed off with the usual “this is the Nation” arrogance, meaning that the newspaper and group was invincible to whatever else that would crash smaller less famous media companies. The situation has of course now changed with a much more sober look all round but many observers believe it may be too late. Newspapers and in particular the Daily Nation have always ruled (as far back as most people can remember) when it came to enjoying the lion’s share of advertising spend. Today Radio has taken over the throne and you can be sure that it is not radio stations owned by the Nation media group that get most of this advertising. Then the Internet came and caused so much chaos. (I was amazed the other day to discover that some locally-based Kenyans are now at the forefront of providing cheap traffic generating content for websites the world over). Coupled with cell phones which the vast majority of the Kenyan population own, the news frontier has completely changed and left old fashioned executives at the Nation stranded. Nothing illustrates this better than what happened shortly after the disputed 2007 presidential elections. At first most media houses were slow in reporting unfolding events (The Nation group is most guilty of this and to date nobody has explained why and how the accurate tallies of votes countrywide that were being compiled at the Nation Centre suddenly disappeared into thin air moments before the hurried “bedroom swearing in” of President Kibaki for a second term). But as the media hesitated, cell phones were still working and forwarded sms messages from citizens on the ground kept many Kenyans very well informed. Email carried these real time messages further and out to influential Kenyans in the Diaspora.

Secondly too many Kenyans have lost faith in the group as a neutral and independent media company and events leading up to and after the 2007 presidential elections fiasco have led many to position the newspaper as biased and even partisan and tribal in its’ approach to reporting news and informing the public. On this last point even those working at the Nation are convinced that many decisions at the media giant are made based purely on tribe. For instance a careful study of lists of senior staff layed off from the newspaper in recent months is extremely revealing. It shows clear and obvious favoritism for a certain leading tribe. Meaning that if you worked for the Nation and were not from a certain tribe your fate was more or less sealed long before the lists of those who were to be laid off were even compiled. A casual observer may disagree because the powerful position od Editorial Director has changed hands recently from long-serving Wamgethi Mwangi (A Kikuyu) to Joseph Odindo (a Luo). However the truth is that Odindo should have held this position at least 20 years ago but was overlooked because of his tribe. Now there was really no option (with sliding circulation changes and rapidly emerging challenges that can only be dealt with by an experienced old hand). Some insiders insist that even then Odindo will never enjoy the power of his predecessor. This dent in the image of the Nation group has been ruthlessly reflected in Daily Nation newspaper sales which in turn have also impacted on advertising sales.

Well, the buck stops at the desk of Chief Executive Officer Linus Gitahi (no mistaking what tribe he comes from—Kikuyu of course). Mr Gitahi has been trying to sell the “warship business strategy” to the board. The idea has been to protect the most valuable core brands by fighting small battles with small niche challengers and keeping them well away from the mother ship. Clearly this is hardly the strategy for the times, if the sales figures at the Nation group are anything to go by.

Then there are other unfolding events. The US government is at advanced stage of spreading their dreaded Visa bans to corporate individuals (my impeccable sources inform me). Top on their lists currently are Linus Gitahi and former Nation CEO Wilfred Kiboro. The reason why these individuals are listed is the subject of a post for another day. But for today, it is clear that developments like these will put the Nation group principal owners (like The Aga Khan) under increasing pressure to effect changes and go for a clean break with the current leadership that has only led the Nation media group from one crisis to another. Time will tell.

For now I must end this post by answering my own question. How serious is the crisis at the Nation group? Answer: More serious than most Kenyans would like to believe. Creative accounting can NOT mask dropping sales forever (one thing Nation accountants must be very grateful for right now are the numerous foreign subsidiaries that Wilfred Kiboro established) and sooner rather than later we will start to see the ominous signs on the balance sheet.


Kumekucha articles in the recent past about the Nation group;

Nation Media Group in Post-Election Genocide Conspiracy With The Police!
Insider Speaks Out

Why Nation Media’s Daily Metro failed

Incompetence and university degress at the Nation media group

Big changes at the Nation and what they mean