• Publisher targets Ontario gaming market
• Newspaper publishing under considerable financial pressure
• Ontarians spend $500m (CAD) a year on gambling
• Local gaming commission must approve plans

The global newspaper industry is facing financial headwinds as fewer people read a newspaper in the digital age. Circulations are down, and although the explosion of online news cannot be ignored, it simply does not bring in the revenues that hard paper sales do. And that’s the problem for the industry because you still need to pay reporters and editors in the digital world.

The largest newspaper group in Canada, Torstar, has been looking at diversifying and exploring new revenue streams since it was purchased by a private equity group last year for $60m CAD. With more than 70 regional and community newspapers, the group had been in private family hands since 1892.

The latest idea is to launch an online casino in Ontario, subject to approval and a license from the region’s gaming regulators.

Return on investment

Figures show Ontarians spend $500m (CAD) a year on gambling activities, much of it with grey market operators. Torstar execs hope to win a substantial slice of that pie if they get their plans through regulators. If they do, it might make the $40m they paid for Torstar last year look like a good investment.

Critics say it is ironic because, before the sale of Torstar, whose titles include the Toronto Star newspaper, the editors may well have taken a dim view of online casinos opening up locally.

Chief Executive Corey Goodman said: “As an Ontario-based media business and trusted brand for more than 128 years, we believe Torstar will provide a unique and responsible gaming brand that creates new jobs, offers growth for the Ontario economy and generates new tax revenue to help support important programs in our province.”

‘Support journalism’

Paul Rivett, chair and co-owner of Torstar, added: “Doing this as part of Torstar will help support the growth and expansion of quality community-based journalism.”

Torstar has not been shy about exploring new revenue streams. It recently launched a parcel delivery service, so a move into online gambling is maybe not that surprising after all.

UK gambling example

Newspaper groups elsewhere have had branded online gaming operations for a while. In the UK, The Sun and The Mirror, two of the leading tabloid national newspapers, both have their own branded bingo rooms and casinos.

Torstar is expected to study the model closely as it approaches regulatory approval.

Previous diversifications have been successful. Torstar previously owned Harlequin, the romantic novel publisher, which it sold for $455m in 2014 to help support its mainstream journalism activities.

Media moves into gambling is not new in TV – for example, Fox Bet is now a major player in the US gambling market, while Sky Bet, now owned by Flutter, has been a big success in the UK.