Fairfax has announced plans to cut nearly 2,000 jobs and switch its landmark The Age and Sydney Morning Herald broadsheets to 'compact' formats as part of cost-cutting measures.
The media company says it will cut 1,900 jobs over the next three years and ditch the broadsheet formats for The Age and the SMH on March 4 next year.
And it will fall in line with its main competitor, News Limited, introducing paywall subscription services for its flagship online services in 2013.
It will also close printing facilities at Chullora in Sydney and Tullamarine in Melbourne by June 2014.
, Fairfax said the plants "have significant surplus capacity which is no longer required".
"No-one should be in any doubt that we are operating in very challenging times," chief executive Greg Hywood said.
"Readers' behaviours have changed and will not change back.
"As a result, we are taking decisive actions to fundamentally change the way we do business." Fairfax says the total saving is expected to be $235 million on an annualised basis by June, 2015.
The papers will prioritise online reporting in a "digital-first editorial model" aimed at increasing flexibility.
Fairfax shares jumped 2.5 per cent this morning after the announcement.
The cost-cutting push comes just days after mining magnate Gina Rinehart reportedly upped her stake in Fairfax as she pushes for at least one seat on the company's board.
Millions of shares changed hand in after-hours trades last week, with speculation that Ms Rinehart, the world's richest woman, now holds at least 15 per cent of the company.
Former editor of The Age Michael Gawenda says he doesn't think Fairfax has handled the digital news transition well.
"There's no good news for people who love newspapers this these announcements," he told ABC News 24.
"I'm very surprised that they've gone tabloid with their papers.
I think it's too late to do that." More to come.