Some try to move faster online, others just cut as industry nears an abyss
By Russ Britt, MarketWatch
Last update: 10:45 a.m. EDT March 17, 2008
LOS ANGELES (MarketWatch) -- The digital wave washing over newspapers has turned into a tsunami in the past several weeks, as hundreds of newsroom layoffs coast-to-coast are raising fears that the push for profits and a dismal economy are teaming up to accomplish the unthinkable -- putting the print industry in its grave.
Daily publications ranging from the San Jose Mercury News in the San Francisco Bay Area to the venerable New York Times have axed reporters and editors -- more than 750 -- in little more than a month, as competition from the online world has joined forces with financial pressures to put on the squeeze.
MarketWatch Special Report
Against a deadline
Are job cuts death knell for America’s newspapers? Some try to move faster online, others just cut as industry nears an abyss.
As newspapers go... So go the bars? MarketWatch reporters around the U.S. take a look at the demise of journalism's famed watering holes.
Adding it all upOnline and print advertising are complex, colliding worlds.• Newsprint: The unknown commodity
MARSHALL LOEBThere's nothing like itIf newspapers lose their race for survival, we all lose something important.
Sales, profits and circulation all are down sharply, as newspapers say they long ago abandoned the prospect of trying to stop the bleeding. Some now say they cuts are so deep, they have to "amputate" portions of their business to stay alive. Meanwhile, they're trying to embrace new media, but can't do so effectively because of constrained resources.
"I guess the worst thing that could happen is the business could fall off a cliff the way the music business did," said Dean Takahashi, a former technology reporter for the Mercury News, who left last month to become a blogger just before a round of layoffs. "I worry that is possible."
Is the death knell beginning to toll for what has been a key source of information for more than two centuries? Do newspapers face the same fate as other traditional media hit by the digital wave, or worse?
Bottom falling out?
A study released Monday by the Project for Excellence in Journalism raises concerns the bottom is about to drop out for the industry. The media research specialist says in its annual State of the News Media report that already ill newspapers got sicker in 2007 with no hope for a cure in 2008.
Advertising revenue fell 7% last year after a flat 2006. The big dropoff was in classified notices, as all categories in that business -- real estate, help wanted and automotive -- lost a bigger chunk of share to online alternatives than they have in recent years.
Circulation is off 2.5% for dailies and 3.5% for Sunday editions. Subscription losses have been the bane of the industry since it hit a peak in the 1950s, but the dropoff is gaining momentum.
Further, the study goes on to say smaller staffs prevented newsrooms from fulfilling their traditional roles and tending to even the most fundamental beats, including basic governmental functions. It quotes Phil Bronstein, executive editor for the San Francisco Chronicle, as he lamented the loss of 100 jobs at his paper last year.
"We can't afford to cover the Richmond City Council anymore," Bronstein said, referring to a nearby community in the San Francisco Bay Area.
And for all the cost-cutting measures underway, newspapers still say earnings at public companies dropped 10% for the year.
"Newspapers are still far from dead, but the language of the obituary is creeping in," the study says.
Fear of death
That confrontation with mortality seems to have manifested itself in a series of layoffs. The Project's study says the industry as a whole lost 7% of its newsroom staff by the end of last year since hitting a 2000 peak.
Many individual papers are much worse off, with some losing up to 40% of their journalists, the study says. The industry finds itself cutting seasoned veterans who are well-connected to the communities they cover, perhaps for financial reasons or because the employer thinks the journalist can't or won't adapt to new digital realities. Regardless of the reason, it's depriving these newspapers of their wealth of experience.
More than a dozen metropolitan dailies throughout the U.S. have announced newsroom cuts since the beginning of February. Among them was New York's Newsday, part of Sam Zell's Tribune Co., which cut 120 total jobs on Feb. 29. Its sister publications, the Los Angeles Times and Chicago Tribune, each cut 100 jobs or more in the middle of last month.
Papers in Boston, Philadelphia, Baltimore and Minneapolis all have made similar announcements recently. Not even the New York Times (NYT:
New York Times Company
News, chart, profile, more
Last: 19.50+0.02+0.10%10:31am 03/24/2008Delayed quote data
Add to portfolioAnalyst Create alert
InsiderDiscuss Financials
Sponsored by:
NYT 19.50, +0.02, +0.1%) could avoid the carnage as the paper known as the "Gray Lady" cut 100 jobs last month.
For many, the most recent cuts are just the latest bad news, as they already have made several rounds of reductions.
At the Mercury News, the paper announced a round of 50 impending newsroom cuts for March 7. Its third reduction since December 2006, employees were told to stay home that morning and wait for a phone call informing them they would be laid off. If they got no call by 10 a.m., they could report to work.
Part of William Dean Singleton's privately held MediaNews Group, the Mercury News was supposed to be the flagship of Singleton's formidable chain in both northern and southern California. But the Denver-based chain's presence there is shrinking. The San Jose newsroom staff now stands at roughly 175, less than half the size it was at its peak of 400 in 2000.
"I would say that we have a lot of very strong journalists still at the Mercury News," Editor David Butler said. "[Having] 175 people is still a potent force."
MediaNews also cut 10% of its newsroom staff at two other Bay Area newspapers and another 18% at the cornerstone of its Southern California fiefdom, the Los Angeles Daily News. Since the L.A. Daily News cuts on Feb. 29, additional layoffs were made at Singleton's other Southern California papers.
Payments totaling $41.2 million on more than $1 billion in debt that Singleton incurred to build that empire -- an empire originally conceived to band a number of smaller dailies together to rival the Chronicle and L.A. Times -- are partly to blame for this latest round of reductions, says Poynter media analyst Rick Edmonds, a co-author of the study.
Singleton did not return phone calls seeking comment.
Many factors
Why so many cuts at so many papers, and why now? A number of factors are at play.
The circulation loss that has been going on for decades is starting to speed up with many of the nation's major dailies experiencing double-digit losses in the past four years alone. The Chronicle and L.A. Times are particularly vulnerable, losing more than 20% of their circulation during that time.
There is perhaps no greater crisis facing newspapers right now than the dropoff in classified advertising. The attractiveness of online alternatives in recent years has left newspapers scrambling to find ways to make up for the income drop. In some cases, this high-margin, low-cost revenue source for newspapers can comprise nearly half a paper's sales and publications are losing up to a third of that income.
Classified sales have always felt the pinch when the economy goes sour. But of late the pain has grown more acute with online competitors such as Craigslist and Monster.com deeply cutting into that business.
Right now, those troubles are exacerbated even more by the sharp downturn in the real estate market, wrought by subprime mortgage troubles and economic uncertainty. Edmonds says that's particularly true in California and Florida.
"They're getting the worst of it," he said.
Stock performance
Community
2 Recommendations
Recommend this story
Tags
newspaper us
Add Tags
More »
56 Comments (view all)
It is a natural progression to eliminate the paper based model. There is no need for it any more! Classifide adds? eBay, Craigs List. Real Estate? Well if there actually were a market for real estate there are plenty of web sites for browsing such a...
- Spelunker
Add Comment
Companies in this story
The Washington Post Company (WPO)
New York Times Company (NYT)
Gannett Co., Inc (GCI)
McClatchy Newspapers, Inc (MNI)
Time Warner Inc (TWX)
Add to Portfolio
Create Alert
(56) - View Comments on this story
Next Page »
1 2
More Special Report stories
12:05 AM 3/17/08
Rising price of newsprint clouds publishing costs
12:01 AM 3/11/08
Dollar's continued drop could mean future gusher for oil
12:01 AM 3/11/08
Weak dollar gets some blame for inflation, thanks for exports
Top stories
9:08 AM today
U.S. stocks poised for gains; shares of Bear Stearns rally
26 minutes ago
Bear Stearns shares double as J.P. Morgan sweetens bid
26 minutes ago
Home resales rise in February on record price decline
More News
Jose R. Cordova
Broker/Owner
CENTURY21 Casa Real Latino
973-546-8888 "Building a team oriented organization with accountable agents and staff.."
Take a few minutes to evaluate your Real Estate Potential. http://c21crl.agenttype.com/
View my blogs at: http://www.c21casareallatino.blogspot.com/
By Russ Britt, MarketWatch
Last update: 10:45 a.m. EDT March 17, 2008
LOS ANGELES (MarketWatch) -- The digital wave washing over newspapers has turned into a tsunami in the past several weeks, as hundreds of newsroom layoffs coast-to-coast are raising fears that the push for profits and a dismal economy are teaming up to accomplish the unthinkable -- putting the print industry in its grave.
Daily publications ranging from the San Jose Mercury News in the San Francisco Bay Area to the venerable New York Times have axed reporters and editors -- more than 750 -- in little more than a month, as competition from the online world has joined forces with financial pressures to put on the squeeze.
MarketWatch Special Report
Against a deadline
Are job cuts death knell for America’s newspapers? Some try to move faster online, others just cut as industry nears an abyss.
As newspapers go... So go the bars? MarketWatch reporters around the U.S. take a look at the demise of journalism's famed watering holes.
Adding it all upOnline and print advertising are complex, colliding worlds.• Newsprint: The unknown commodity
MARSHALL LOEBThere's nothing like itIf newspapers lose their race for survival, we all lose something important.
Sales, profits and circulation all are down sharply, as newspapers say they long ago abandoned the prospect of trying to stop the bleeding. Some now say they cuts are so deep, they have to "amputate" portions of their business to stay alive. Meanwhile, they're trying to embrace new media, but can't do so effectively because of constrained resources.
"I guess the worst thing that could happen is the business could fall off a cliff the way the music business did," said Dean Takahashi, a former technology reporter for the Mercury News, who left last month to become a blogger just before a round of layoffs. "I worry that is possible."
Is the death knell beginning to toll for what has been a key source of information for more than two centuries? Do newspapers face the same fate as other traditional media hit by the digital wave, or worse?
Bottom falling out?
A study released Monday by the Project for Excellence in Journalism raises concerns the bottom is about to drop out for the industry. The media research specialist says in its annual State of the News Media report that already ill newspapers got sicker in 2007 with no hope for a cure in 2008.
Advertising revenue fell 7% last year after a flat 2006. The big dropoff was in classified notices, as all categories in that business -- real estate, help wanted and automotive -- lost a bigger chunk of share to online alternatives than they have in recent years.
Circulation is off 2.5% for dailies and 3.5% for Sunday editions. Subscription losses have been the bane of the industry since it hit a peak in the 1950s, but the dropoff is gaining momentum.
Further, the study goes on to say smaller staffs prevented newsrooms from fulfilling their traditional roles and tending to even the most fundamental beats, including basic governmental functions. It quotes Phil Bronstein, executive editor for the San Francisco Chronicle, as he lamented the loss of 100 jobs at his paper last year.
"We can't afford to cover the Richmond City Council anymore," Bronstein said, referring to a nearby community in the San Francisco Bay Area.
And for all the cost-cutting measures underway, newspapers still say earnings at public companies dropped 10% for the year.
"Newspapers are still far from dead, but the language of the obituary is creeping in," the study says.
Fear of death
That confrontation with mortality seems to have manifested itself in a series of layoffs. The Project's study says the industry as a whole lost 7% of its newsroom staff by the end of last year since hitting a 2000 peak.
Many individual papers are much worse off, with some losing up to 40% of their journalists, the study says. The industry finds itself cutting seasoned veterans who are well-connected to the communities they cover, perhaps for financial reasons or because the employer thinks the journalist can't or won't adapt to new digital realities. Regardless of the reason, it's depriving these newspapers of their wealth of experience.
More than a dozen metropolitan dailies throughout the U.S. have announced newsroom cuts since the beginning of February. Among them was New York's Newsday, part of Sam Zell's Tribune Co., which cut 120 total jobs on Feb. 29. Its sister publications, the Los Angeles Times and Chicago Tribune, each cut 100 jobs or more in the middle of last month.
Papers in Boston, Philadelphia, Baltimore and Minneapolis all have made similar announcements recently. Not even the New York Times (NYT:
New York Times Company
News, chart, profile, more
Last: 19.50+0.02+0.10%10:31am 03/24/2008Delayed quote data
Add to portfolioAnalyst Create alert
InsiderDiscuss Financials
Sponsored by:
NYT 19.50, +0.02, +0.1%) could avoid the carnage as the paper known as the "Gray Lady" cut 100 jobs last month.
For many, the most recent cuts are just the latest bad news, as they already have made several rounds of reductions.
At the Mercury News, the paper announced a round of 50 impending newsroom cuts for March 7. Its third reduction since December 2006, employees were told to stay home that morning and wait for a phone call informing them they would be laid off. If they got no call by 10 a.m., they could report to work.
Part of William Dean Singleton's privately held MediaNews Group, the Mercury News was supposed to be the flagship of Singleton's formidable chain in both northern and southern California. But the Denver-based chain's presence there is shrinking. The San Jose newsroom staff now stands at roughly 175, less than half the size it was at its peak of 400 in 2000.
"I would say that we have a lot of very strong journalists still at the Mercury News," Editor David Butler said. "[Having] 175 people is still a potent force."
MediaNews also cut 10% of its newsroom staff at two other Bay Area newspapers and another 18% at the cornerstone of its Southern California fiefdom, the Los Angeles Daily News. Since the L.A. Daily News cuts on Feb. 29, additional layoffs were made at Singleton's other Southern California papers.
Payments totaling $41.2 million on more than $1 billion in debt that Singleton incurred to build that empire -- an empire originally conceived to band a number of smaller dailies together to rival the Chronicle and L.A. Times -- are partly to blame for this latest round of reductions, says Poynter media analyst Rick Edmonds, a co-author of the study.
Singleton did not return phone calls seeking comment.
Many factors
Why so many cuts at so many papers, and why now? A number of factors are at play.
The circulation loss that has been going on for decades is starting to speed up with many of the nation's major dailies experiencing double-digit losses in the past four years alone. The Chronicle and L.A. Times are particularly vulnerable, losing more than 20% of their circulation during that time.
There is perhaps no greater crisis facing newspapers right now than the dropoff in classified advertising. The attractiveness of online alternatives in recent years has left newspapers scrambling to find ways to make up for the income drop. In some cases, this high-margin, low-cost revenue source for newspapers can comprise nearly half a paper's sales and publications are losing up to a third of that income.
Classified sales have always felt the pinch when the economy goes sour. But of late the pain has grown more acute with online competitors such as Craigslist and Monster.com deeply cutting into that business.
Right now, those troubles are exacerbated even more by the sharp downturn in the real estate market, wrought by subprime mortgage troubles and economic uncertainty. Edmonds says that's particularly true in California and Florida.
"They're getting the worst of it," he said.
Stock performance
Community
2 Recommendations
Recommend this story
Tags
newspaper us
Add Tags
More »
56 Comments (view all)
It is a natural progression to eliminate the paper based model. There is no need for it any more! Classifide adds? eBay, Craigs List. Real Estate? Well if there actually were a market for real estate there are plenty of web sites for browsing such a...
- Spelunker
Add Comment
Companies in this story
The Washington Post Company (WPO)
New York Times Company (NYT)
Gannett Co., Inc (GCI)
McClatchy Newspapers, Inc (MNI)
Time Warner Inc (TWX)
Add to Portfolio
Create Alert
(56) - View Comments on this story
Next Page »
1 2
More Special Report stories
12:05 AM 3/17/08
Rising price of newsprint clouds publishing costs
12:01 AM 3/11/08
Dollar's continued drop could mean future gusher for oil
12:01 AM 3/11/08
Weak dollar gets some blame for inflation, thanks for exports
Top stories
9:08 AM today
U.S. stocks poised for gains; shares of Bear Stearns rally
26 minutes ago
Bear Stearns shares double as J.P. Morgan sweetens bid
26 minutes ago
Home resales rise in February on record price decline
More News
Jose R. Cordova
Broker/Owner
CENTURY21 Casa Real Latino
973-546-8888 "Building a team oriented organization with accountable agents and staff.."
Take a few minutes to evaluate your Real Estate Potential. http://c21crl.agenttype.com/
View my blogs at: http://www.c21casareallatino.blogspot.com/
No comments:
Post a Comment