The following is a paper I presented on April 25, 2009 to the Monday Evening Club of Pittsfield, Massachusetts
The topic I’m presenting tonight will be familiar to most of you, even if you have not been a regular visitor to my blog. Not a week has gone by in the last six months without news of a threatened or actual closing of a major newspaper, the bankruptcy of a major newspaper publisher, layoffs, buyouts or mandatory furloughs imposed on newspaper employees, and other symptoms of the travails of a once-powerful and monopolistically rich industry. This month [April, 2009], readers of the Boston Globe were shocked to find a front-page headline and story disclosing that its owner, the New York Times Company, was threatening to stop publishing the paper on May 1 unless it got major concessions from its unions.
It’s not surprising the New York Times Company would make this threat, since the Globe is reported to be losing well over a million dollars a week. The Times company has run out of credit lines, has sold and leased back a chunk of its recently completed Times Square headquarters building, is peddling its stake in the Boston Red Sox, and has borrowed $250 million from a Mexican tycoon the flagship paper had earlier called a robber baron. Clearly the Times is not in a position to subsidize the red ink at the Globe, for which it paid $1.1 billion in the mid 1990s.
And among newspaper owners, the Times company is relatively well off. Among the publicly-owned US newspaper firms, several are bankrupt, and most have credit ratings at or near junk-bond status. Their collective market value has fallen by more than 90 percent in the past few years. Collectively, the industry has laid off more than 10 percent of its workforce since the start of 2008. The combined paid circulation of American daily newspapers has fallen from more than 63 million in 1984 to less than 50 million today — a drop of 21 percent during a time when the number of households grew by about 40 percent. U.S. Daily newspapers today have less than 14 percent of total U.S. advertising expenditures. In 1989 it was 28 percent — so they’ve lost half their market share in 20 years. These are long-term trends that predate the arrival of the World Wide Web, and they have continued unabated through economic expansions as well as recessions.
For people with an appreciation for the importance of good journalism to the maintenance of a free and democratic society, and for the historical role of newspapers in providing what is often considered the best, broadest and deepest journalism available, the industry’s decline is a concern. What went wrong? What can be done? Will there be newspapers a few years from now? Where will essential journalism happen if newspapers depart the stage?
The origins of the present crisis in newspapers, as I’ve indicated, go back many years. The question is, what’s driving the trend away from newspaper reading?
Continue reading this post at the Monday Evening Club blog.
Photo: the "newsboy statue" in Great Barrington, Massachusetts, by AkaGeorge, used under Creative Commons license.