Death Knell for the Newspaper Business?
Colorado's most famous newspaper last weekend said 'Goodbye, Colorado' as its final headline. The newspaper, which started in the 1850s, had been surrounded by months of rumors of its demise. It leaves Denver with only one major newspaper, the Post.
This could be the start of a trend. The San Francisco Chronicle has already said that will either be sold or closed within months. The two Detroit newspapers, the News and Free Press, are not printing full weekly papers anymore because of cost cutting.
Even the jewels of the paper industry are suffering. The New York Times had a 48 percent decline in profits, and online sales fell for the first time as the recession depressed spending by advertisers. They have already mortgaged their building in Manhattan to pay for costs, and are considering selling numerous assets, including the Boston Red Sox, in order to stay afloat. Newscorp, Rupert Murdoch's company, had a staggering $6.4 billion loss last quarter, primarily from losses from newspapers such as the recently acquired Wall Street Journal. In fact, Newscorp lost money across the board, including the Fox TV network, although FoxNews appears to be whether the storm just fine; it made a tidy profit.
So what does all this really mean? I think it means the end of the newspaper industry as we know it. Readership was plummeting even before the recession. That decreases advertising dollars. Here is the larger problem: young people don't read newspapers. Other than times when I can't get internet access (which nowadays, is basically only when you are on commercial airliner at 30,000 feet), I never read a newspaper. I read a plethora of sources on the internet, including newspapers sites.
And, of course, there is the fact that I pay nothing for the news I get. In the free market, nothing always beats something. And ultimately, that is the biggest problem. Newspapers provide an archaic way to transfer information in the digital age, and on top of that are not free.
Their survival hinges on capitalizing on their internet portals. That is easier said than done. The New York Times and others have tried pay services for internet news; Newsday is rumored to be considering one now. These services have all been an abject failure. Again, you can't beat free.
For conservatives, I know we giggle in glee when we see the New York Times suffering. But long term, this is not good. TV news, in all frankness, is kind of useless. The investigative journalism we need in this country originates with the newspapers. And although they have largely become ridiculous havens for liberal wack-job thinking, they are also an essential component to a vibrant economy.
If the newspapers fail, which I think long term is as likely as the car industry going bust, others will have to take up the obligation. I don't know if it will be news portals such as Yahoo, Google, and others. Maybe it will be 'professional' bloggers. But we must sustain investigative journalism. It is an essential part of the informal checks-and-balances in this country.
Sources: http://www.huffingtonpost.com/2009/01/28/new-york-times-ad-revenue_n_161607.html; http://www.huffingtonpost.com/2009/02/05/news-corp-suffers-stagger_n_164463.html
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Grew up in Michigan, went to college at the University of Michigan. After completing medical school and residency, I completed my fellowship at Memorial Sloan-Kettering Cancer Center. I am currently runni... View profile
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