Investing to Wealth

If it takes a good man to admit when he's wrong, then I'm up there.

My error: the speed of the decline of print newspapers. They're not dropping slowly: they're dropping like flies. And the metro dailies appear to be among the weakest: Detroit, Philadelphia, Chicago, San Francisco, Seattle, Denver. Who's next?

A journalism colleague called from Washington, D.C.: his reporter sister was laid off in Denver, whose ex-college roommate, the editor, got the axe in Seattle, and on and on it goes.

The big error in news/editorial conference rooms (and in this space, I might add): the failure to anticipate the speed of the decline of revenue. It's crumbling, due to the internet and the pronounced recession. (And here's hoping it's just a pronounced recession.) The online operations of many print dailies are doing OK-to-good, but the problem is they've started from such a low base and the ad market has become so fragmented/dispersed on the web that the web sites can't increase revenue fast enough to support the increasing losses from the print daily. The solution? Obviously, stop the print bleeding. In other words, shut down the print newspaper. And down they go. It is so sad. As noted earlier, some print dailies will survive with niches/specialization, but their overall operations will be smaller, due to the considerably lower gross annual revenue (at least initially) on the web.

What about The Gray Lady?

And what about The New York Times (NYSE: NYT)? Who knows? It's the highest of high-cost metropolitan dailies, but it's also the best newspaper in the world. There's talk that it may try to implement a minimal monthly charge. Will it work? It could ... if The Times has 50 million fans. Otherwise? Would you pay $2 per month to read The Times, or just try to get the international news and national news you're interested in somewhere else? OK, how about $1 per month? Even by my math $1 per month for 10 million subscribers (and that would represent a huge upside) would generate just $120 million in annual subscription revenue. Add another $200-300 million in online ad revenue and you could have a decent online daily, but not a staff of thousands who each get nice six-figure salaries.

And with lower revenue, that means fewer stories and subjects will be covered. Who will take up the slack? Citizen journalists? Admirable, inspiring, put can you put a citizen journalist on a topic for six months (as my first metropolitan editor did) and say 'This school district is stealing money, and we know it. We just have to catch them red-handed. In the act. Stay there until you find something!' (My paper did.) Don't know how many suburban-types have the patience for that. And if they don't, and no one replaces them, a check on public and private sector abuses will have been weakened.

Perhaps more trusts and charitable organizations will support online newspapers, given their low resources. Not ideal? True, but it may be the future. No one expected private newspapers to be run like public trusts. But then again, no one expected banks to be, either.



Financial Editor Joseph Lazzaro is based in New York.



What do you think about the end of so many print newspapers across our nation? Can internet newspapers fill the gap? Let us know what you think.

Filed under: Bad news, Newspapers, Internet, New York Times'A' (NYT), Media World

Print daily newspapers are going, going ... originally appeared on BloggingStocks on Fri, 27 Feb 2009 12:25:00 EST. Please see our terms for use of feeds.

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