Newspapers are coming apart at the seams. Anyone who reads them regularly knows that much. Just today, Hearst announced it may close the San Francisco Chronicle, a paper that’s been operating for 144 years.
And Heart’s problems are the tip of the iceberg. The Tribune Company, Gannett, Scripps and many others are struggling to keep their papers afloat. All of which makes it difficult to understand the optimism in this Ad Age piece by Nat Ives.
For all the apocalyptic news about newspapers, there’s a distinction worth making: Newspaper owners are far more endangered than the medium itself.
Even as they take blow after blow from recession and digital media, newspapers themselves still earn decent profits. They do even better outside big cities, which tend to get all the attention.
Ives goes on to discuss write downs, interest payments, taxes, depreciation, amortization and other financial jockeying while pointing out that publicly owned newspapers averaged an operating profit of 10.8% in the first three quarters of last year.
So why all the blood letting? Can it be that all the downsizing we’re seeing is really rightsizing? I know it doesn’t look that way inside the nation’s spartan newsrooms. Steve Buttry of the Cedar Rapids Gazatte had to let 13 colleagues go today.
These were many of the same colleagues responsible for my proudest day. Every one of them deserves a job with this company. Every one of them deserves a job somewhere in journalism or somewhere in this community. But Tuesday I had to tell them they no longer had jobs here.
So the human drama plays out while number crunchers rework the balance sheets of America’s newspapers. Meanwhile, talented writers, editors and photographers are out of work and there’s a mountain of news that goes unreported everyday. All this, at a time in the nation’s history when it’s absolutely critical to have greater oversight of government and industry.
Newspapers are working to adjust themselves to the digital realities of our time, but one of those realities is that it’s much harder to monetize online content than it is printed content. In other words, moving to an online only edition isn’t the perfect answer when the online edition has zero paid subscribers and relies solely on a diminished pool of ad dollars.
The bottom line for all online content producers is we won’t have it right until we have the economics right. Value is being created online, but in too many cases it’s not being exchanged for money.
[UPDATE] Rocky Mountain News closed down today (Friday). They leave their audience with this well made documentary about their demise: