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The Daily Shrinking Planet


Even gung-ho newspaper executives are getting gloomy about the future

By this time next year, there's a good chance that you won't recognize your local big-city newspaper.

In early June, Jim Romenesko's well-known journalism site posted a memo from Dave Butler, executive editor of the MediaNews Group's San Jose Mercury News. In it, he discussed the prospect of significantly shrinking his paper's print editions on Mondays and Tuesdays, which are typically the most ad-starved days of the week. The Mercury News is not the only major daily nearing such a move, say newspaper executives elsewhere with firsthand knowledge of such deliberations. They say big metros also are discussing a wide range of other radical notions. Among them: making home deliveries only on certain days of the week, shrinking additional weekday print editions, and even cutting out paid papers entirely on certain days of the week in favor of a smaller and free product. (The executives promise their Web sites will pick up the slack on days when the print edition is skimpier.)

GRUESOME COSTS

These changes even outdo those mentioned by Randy Michaels, Tribune's (TXA) chief operating officer, who touched off a minor media uproar on June 5 when he said his company's nine papers will lose around 500 news pages a week. Astonishing developments, all. But then these are astonishing times. In a recent report, Deutsche Bank (DB) analyst Paul Ginocchio predicted that total newspaper revenue this year will drop 11.2%, on top of a 9.4% fall in '07. He also suggested that newspapers' pricing power on certain classified ads is eroding—fallout, presumably, from the emergence of online players such as craigslist. Meanwhile, costs are gruesome. Newsprint prices, the biggest expense for a newspaper, could be as much as $200 per ton higher this fall than they were a year ago. The price of gas, too, has serious implications for an industry that still distributes its product by the palletful (hence the proposed cuts in home delivery). In an address to the World Newspaper Congress on June 2, Dean Singleton, MediaNews' chief executive officer, said that, in his estimation, 19 of the top 50 U.S. newspapers are losing money. And, he warned, "that number will continue to grow."

"It's reality," a matter-of-fact Singleton subsequently told me. "You can't get to the other side of the river unless you face reality."

This is why I'm hearing things from senior newspaper executives that I've never heard before. In making the case for compressing some print editions, one executive says: "We are putting out, in many cases, more journalism than anyone can consume in a given day." This, he says, "bring[s] on a bit of a guilt factor" among readers who don't have time for a long, leisurely morning read. Well, maybe, but I can't imagine readers will feel they're getting much bang for the buck if their daily papers shrink to the 10 pages they most care about.

There isn't much maneuverability for the American city daily, which has taken the brunt of the industry's dislocations. As crazy as this once sounded, I'm now convinced one or more major American markets will lose their daily newspaper within 18 months. (Singleton and Rupert Murdoch, who know more about this than I do, agree conceptually, if not on the time frame.)

So it goes for the newspaper business. What, then, happens to news?

The optimistic example is found in music. The quantity and availability of rock and pop are mushrooming for consumers even as life gets worse for the traditional businesses at the center of the equation: major record labels.

But this metaphor isn't extendable to news. While you can record and distribute an album cheaply, some forms of journalism still take serious chunks of time, manpower, and resources to create. Now, I refuse to equate newsroom cutbacks with the death of news. For one thing, city media ecosystems have proven to be vibrant things that constantly spawn new local and niche blogs. The best—never underestimate the voltage one energetic reporter can generate—match or even outdo their traditional rivals in many respects. But not all of them. Newspapers still do some things that can't be replaced. Unfortunately, we're about to find out exactly what those things are.

Fine is BusinessWeek's MediaCentric columnist and Fine On Media blogger .

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