The Newspapers Are Dying
I know it all supposed to be the fault of the Internet, but I don’t see that as even in the top ten of the problems of the print media. Badtux outlined a plan that would have given the newspapers control of their future on the ‘Net, but they didn’t understand the medium or how to use it.
News Writer at Stop The Press!, Susie Madrak at Suburban Guerrilla, and Athenae at First Draft cover the print media from a perspective of insiders, i.e. current or former print media professionals, so there’s no reason for me to get into that.
For me the key to understanding what is going on is the reason that the fall of the Rocky Mountain News has been followed by so many other papers’ reported as being in deep trouble. The reason is simple, debt load. The reason for the debt load is also simple, leveraged buyouts. When media consolidation began in earnest the debt for print media skyrocketed.
Newspapers once made great returns, usually around 20% for a large market, but they began spending it on debt service after being bought up on credit. They can’t “weather the storm” in the current GOPression because they are in hock up to their printing press.
The actions of the conglomerates to increase profits were to cut costs in exactly the wrong area – reporting. No one buys a local newspaper for the AP feed stories: they buy the local paper for local news which requires local reporters. People are much more willing to pay to read about people they know, than people they don’t know. The national and international news is available at a lot of places, but only the local newspaper will have local news and sports.
It’s stupid to think that people are going to pay to visit a newspaper’s web site to read the wire service feed they can get for free other places, or to read syndicated columnists that are also available on free sites. They will however pay to read locally reported stories that are available nowhere else, because there is no other way of getting the information. When the chains cut the local reporting, they destroyed the main thing people were willing to pay for. When the Local Puppy Trainer reduced their costs by cutting some veteran reporters and columnists, my Mother canceled her subscription because the new people didn’t know enough to be able to accurately report the real news.
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Don’t get me started on “local” papers. We have the big problem of weathly whackadoodle wanting a paper for her collection of things…and then promptly broke it…and the trust of the community. The News-Press used to be good. It even won a Pulitizer…but now…we have photos of fuzzy animals on the front cover because Wendy wants to show happy cute things.
You are right…it is the debt that is drowning these papers but you don’t hear that from the corporate media.
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Actually, California papers have a long history of being owned by “weathly whackadoodles”, but, yes, I know about Wendy. Too bad Peter Pan isn’t available. 😉
We have the perfect example of a newpaper with too much debt here in Chicago. Sam Zell took the Tribune private in a highly leveraged buyout. Problem is, he’s not generating enough cash flow to cover the interest payments.
The paper is now half the size it was last year and has been hemorrhaging staff in an effort to cut costs. They even eliminated the local news section (dumb, I know) and received so many complaints they had to put it back (ok, smart move).
Last I read they had hired bankruptcy lawyers “just in case”. They better sell the Cubs baseball team quickly.
It’s a standard ploy, to take control with a leveraged buyout and them make a killing by selling off components. The problem is that the days of cheap credit are gone, and the bonds are too expensive for leveraging.
Most of the papers in deep trouble now once had cash reserves, but everything was looted in the buyout, including the pension funds.
The money is no longer available and bankruptcy is about the only thing left for most of the “geniuses”.
Our local paper, a weekly, caved in January.
The next closest local paper, which is actually a pretty large daily, is still going. But they have a problem in Subscriptions – their latest tactic is dumping papers on your porch for a week, then sending you a bill….. when you never asked for them. I had cancelled that paper a couple of years ago, because their delivery person kept ruining my flowers. Even after I complained for the better part of a year, the idiot never threw them on the porch even once. And it’s right next to the road…. So it had nothing to do with the paper itself, or even with getting my news online.
I wonder, though, about the Lancaster paper. That area is not as much in the 21st century as cities like Philly, and the paper is a major connection for the community. There aren’t too many Amish with the internets. It seems to be doing well….considering….
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My Mother pays about $15/year for the monthly newsletter from her tiny home town in New York to keep up with old friends, so it isn’t a matter of people not willing to pay. if they are going to cut costs, cut the AP feeds and stick with what no one else provides – local news.
Face it, people depend on television for national and international news, but media consolidation has all but eliminated local radio news, and the same thing is going on with the local TV news.
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