Newspapers feeling the pinch
Published 3:44 pm Friday, February 6, 2009
You hold in your two hands today a product that is feeling the pinch of the economy just as is every business and industry.
Newspapers across the country have seen their advertising revenues plummet, page counts shrink, and talented staff members in unemployment lines.
A case in point was the Tuesday edition of The Tallahassee Democrat, not a particularly hot revenue producing edition.
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The newspaper totaled 24 pages. Of those 24 pages, 14 were full open pages, or, had no advertising displays at all. Of that 24 page total, an additional one full page, and one half page had ads promoting the Democrat. Basically, of the 24 pages, 16 pages had no ads producing revenue.
I bought a copy of The Albany Herald to compare. The Herald on Tuesday totaled 18 pages. There were five open pages, and five pages with only a smidgen of tiny ads. You could almost call them open pages too, which means out of 18 pages, eight pages had some decent revenue producing ads.
Across the country, the highly profitable Gannett Company, owners of The Democrat, felt the pinch of declining profits. Gannett is the largest owner of newspapers including USA Today. Company wide, their ad revenues were down 19 percent in the fourth quarter last year. The company has cut 10 percent of its workforce, or about 4,000 jobs. The Democrat in recent weeks announced job layoffs.
The bellwether New York Times is off 11 percent for the quarter, seeing its net income drop to $27.6 million from $52.6 million for the year. Years ago, while working for The Lakeland Ledger, a New York Times Company, we could buy Times stock at $42 a share. I was shocked to learn Times stock is bargain basement today at $5.98.
To alleviate billions of debt due in the next few years, the Times wants to sell its headquarters skyscraper building in New York City plus its stake in the Boston Red Sox baseball team. Times are tough when a newspaper has to shed its baseball team.
Now if you really want bargain, the McClatchy Company, which owns 30 newspapers including The Miami Herald, will sell you their stock for 85 cents a share, a 97 percent drop in one year.
Enter the Internet. Here’s where the action is, where folks go to read the news, pick up advertising messages, and think they can buy anything cheaper from a Web site.
To counter this, newspapers have developed ad revenue producing and breaking news Web sites, but the revenue from them is far from what print can bring in. Plus, my belief is, each time a newspaper directs you to their Web site, it’s just driving another nail in the coffin of their demise. It has been predicted, with declining revenues and declining readership, sometime within the next few years, a major metropolitan city will not have a daily newspaper to read. Keep an eye on Chicago or Los Angeles.
Already in Detroit, you only get home delivery now of the Detroit Free Press four days a week.
No doubt, weekly community newspapers are feeling the strains of the economy. But I believe there always will be a high interest in community newspapers like The Post-Searchlight. If the newspaper is the major media outlet in the community, and it is doing its job serving its community, then it will always be wanted.
So as more and more people get their news from the Internet and turn more and more to solid news reporting on television, the future of newspapers looks grim. Reports indicate that television news shows, which go in-depth on particular subjects, draw high viewer interest. TV news shows getting high ratings include “60 Minutes” averaging 15 million viewers, “Meet the Press,” with about 4 million viewers, and PBS’s “NewsHour with Jim Lehrer” drawing about 1.5 million nightly viewers on average.
As one who has spent 25 years working in newspapers, it pains me to see their decline. Noticing the no ads editions of the Tuesday Democrat was shocking.
I have noticed one positive outcome of the economic slowdown. There’s less and less TV ads with announcers shouting at you. We have worn down the mute button on our TV remote when these ads come on.
Be wary of news on the Internet unless it comes from reliable sources. The Drudge Report, for example, has high readership, even gets quoted as a sources of news. Yet Drudge himself has been quoted as saying in order to maintain high readership, he is not above making up the facts.
The drain on newspapers may have one positive. It’s going to save a lot of trees.