Business View: Journalists have lots to offer but more to learn

A 23-year-old banking writer stepped into the offices of The Daily Telegraph in January 1988. His first few days, under the famously abrasive City editor Neil Collins, were a nightmare. But he toughed it out, thrived and carried on in financial journalism for another 18 years, the last six and a half as City editor of this paper. But this weekend I leave, to join Barclays as public relations director.

I can't say I'm not sad to go. Journalism is a great trade if done well. And to be done well it needs the support of editors, a strong team ethos and the momentum that is created from knowing what the publication wants to deliver. But too often good financial journalism is undermined by the pressure under which it is produced, largely created by the structure of the papers that produce it.

The UK is one of the most competitive markets for newspapers in the world. Every day we have five quality papers, two mid-market tabloids and three "red top" tabloids (four red tops on Sunday). Of the quality papers, only one group has been genuinely and consistently profitable - the Telegraph.

Among the rest, subsidies from the parent abound - from The Guardian shouldering The Observer's losses to the long battle to bring The Independent and The Independent on Sunday into profit. Times Newspapers, which owns The Times and The Sunday Times, lost £47m last year - and The Times itself has never made a profit under Rupert Murdoch's ownership. I defy you to find anything else in his empire which has lost money for over two decades.

How come these papers lose so much money? One reason is overcrowding. There are simply too many national newspapers in the UK. Yet owners are willing to continue to fund them because of the influence they give.

Lord Stevens of Ludgate, former chairman of the Express group, was asked what the advantages of his ownership of a national paper were. He answered: "You are calling me Lord Stevens, aren't you?" Why would sensible, successful businessmen like Sir David and Sir Frederick Barclay fritter tens of millions away on The European and The Business and then spend hundreds of millions on the Telegraph Group were it not for the vainglory?

Tycoons who buy newspapers tend to be richer than those who buy football clubs, but they often suffer similar delusions. Football club owners will plough millions into a club to try and secure success, with only a handful succeeding (Silvio Berlusconi, Roman Abramovich and Jack Walker spring to mind). With newspapers, the proprietors - and I include Guardian owner the Scott Trust here - try to expand circulation, aiming to buy market share in an industry, which has long been in decline. Spending on expensive columnists, giving away DVDs, cutting the cover price - all these are currently being deployed in a battle for sales that often resembles the trench warfare in Flanders between 1914 and 1918.

Only Express Newspapers and Independent News & Media really think about how to produce papers in a cost-effective manner. The regional newspaper companies, such as Johnson Press or Gannett, have a lot to teach "Fleet Street" about producing profitable papers.

Which makes it rather ironic that the City pages, every day, tell the likes of Vodafone, BP or Tesco how to run their businesses. I have been guilty of this. And now I'm off to a company which will make more money this year than all the UK's national newspapers have made during my entire career working for them. People ask me why I'm doing it, and one of the reasons is that - perhaps - I'll learn something.

An investment banker once said to me that the problem with journalists is that they only ever know about a third of the story at best. Soon I will know whether this was a cruel indictment of my career so far - or a tellingly accurate comment.