KEY POINTS:
David Kirk's downfall was written on the wall at Fairfax Media two years ago.
Kirk stepped down yesterday after three years as Fairfax chief executive.
The question now is whether the new management intends to maintain his plans for Fairfax's New Zealand assets, such as the Sunday Star
Times, Dominion Post and The Press newspapers. Fairfax also publishes magazines such as NZ House & Garden and Cuisine.
On December 7, 2006, Kirk announced the merger with the successful but much smaller Rural Press, led by John B. Fairfax.
It brought the Fairfax family back into the company that bears their name and even at the time there were those who wondered how the old style of Fairfax would fit with the new style under Kirk, who was inexperienced in media.
The two arms of the company did not work.
The Fairfax family has asserted oversight but, under a policy of heavy acquisitions funded out of debt market capitalisation, it slipped further on Australia's ASX 200 sharemarket index.
And with that crash, John B. Fairfax has seen a massive fall in his own fortune.
But will John B. Fairfax - who owns 13 per cent of the firm - assert himself against the rest of the board and its longtime chairman, Ron Walker?
The Kirk era has seen initiatives like the costly acquisition of internet auction site Trade Me.
Trade Me - while seen as an expensive purchase at the time - has provided the foundation for Fairfax's shift online.
There will be many at Fairfax New Zealand's offices in the Viaduct Harbour looking for the next signs from head office in Sydney.
Within Fairfax - despite the current slump in advertising revenue that is hitting much harder than in Australia - New Zealand was seen as efficient, with much leaner staffing.
Fairfax shareholders would welcome Kirk's exit as chief executive as he falls victim to the global economic crisis, analysts quoted by AAP said.
Australia's leading media buyer, Harold Mitchell, said shareholders would approve of the departure as the slump in advertising, fall in consumer spending and financial crisis hit company profits.
"Fairfax's share price has been pummelled and many shareholders think it should be better," Mitchell said.
"I think it will be seen as a very good decision.
He is being replaced by a man [deputy chief executive Brian McCarthy] who is very competent in the media business."
EL&C Baillieu senior analyst Ivor Ries said Kirk's resignation was "inevitable".
"My summation is that the Fairfax board has had a good sit down over the last couple of days and decided - we are in a once in 50 years crisis in some of our titles, we need someone who has had direct experience of managing print media assets."
