Updated: These are dark days for the media business, with many traditional media owners caught in the intergalactic shift to online from off. This is going to kill a lot of newspapers. Among the latest developments, Tribune Co. (s trib), parent company of the Chicago Tribune, LA Times and others (and owner of the Chicago Cubs), has filed for bankruptcy, while The McClatchy Co. (s mni) is rumored to have put The Miami Herald up for sale. So is Rocky Mountain News.
Even before that, the Chicago-based credit ratings firm Fitch, which rates the debt of both companies as junk, said it “believes more newspapers and newspaper groups will default, be shut down and be liquidated in 2009 and several cities could go without a daily print newspaper by 2010.” They are worried that newspapers would are facing declines in all four revenue streams: circulation and local, classified and national ads. In other words, we can expect even more bad news from this sector.
Recommended Reading: Mitch Joel tears apart the current media plans to go smaller to survive.
The other side is to embrace the digital world. It’s hard to fault some of the publishing and music companies here. The problem is, we’re probably kidding ourselves if we think that by embracing Twitter, Blogs and MySpace, that these two industries are going to be able to change much or find the record profits they were realizing in the days before the Internet changed everything we know about the news, journalism and how information spreads.
In related development, today The Pulitzer Prizes said that they will now recognize and give awards to online publications for their journalistic efforts. And at the same time, Sig Gissler, administrator of the Prizes said that “The Board will continue to monitor the impact of the Internet.” That sentiment pretty much sums up what Joel is shouting out loud. Hat Tip, PaidContent.
9 thoughts on “Off Topic: Trouble Rocks Major Newspapers”
You can put the Rocky Mountain News (Denver) on the list, they try to find a buyer buy mid Jan. or …
That’s good news – the American newspaper model is broken, but won’t change until forced to…well, it looks like change is here — get people interested again, or go out of business.
So if a local newspaper in a non-competitive market goes under, what do you think will happen? In Austin there’s only one paper. It’s not a good one, but if provides better coverage of the city than any web site or TV news station.
I imagine a competitor would come in and at least try to create a web-based newspaper for the city, but web advertising still can’t pull in the money that people foolishly spend on print advertising. Car dealers and mom & pops still don’t get the web. I can’t see a web-only city paper being able to keep qualified people on staff at reasonable salaries and make the economics work…but there has to be an opportunity in the fall out.
Again, I’m talking about local city news and not something that can be covered by a blog like this.
Sam Zell’s interview in Portfolio Magazine (it’s available online) is pretty interesting. He mentioned that Tribune ad sales staff were not paid for performance, said he didn’t give a rip about Pulitzers and planned to focus on local info, since international, financial and other news was better online or on TV. He came across as somehow arrogant, humbled and confused, all at the same time.
It sounds like Tribune’s properties would make money (for a while, anyway) if their debt was cut or wiped out.
To add to the mess, most local papers – the ones that should be able to thrive and really monetize – are being all but ignored by most mass media publishers. I believe hyper-local to be one of their only saving graces. Give people – in the their local communities – the news that’s important to them. Let them share that news, upload it, update it, comment, etc… These major companies are all-but ignoring their local paper properties to try and save the big, national brands. That strategy will further choke them in the long run.
None of this surprises me really…newspapers have been struggling for years now. I’ve predicted the end of most newspapers as we know them within 50 years (it will all move online), but heck, it may be even sooner.
I was actually talking about this today and believe google is the majro cause for their demise!
Andres Montejo Law