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Opportunity is knocking
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With so much negative news, it's easy to think our world, as we know it, is coming to an end.
Newspapers are shutting down. Denver's Rocky Mountain News (Scripps) shuttered its windows just weeks short of reaching their 150th anniversary. The Tucson Citizen (Gannett) is expected to close as no buyers are stepping forward to buy the lesser half of a Joint Operating Agreement. Hearst is expected to close the Seattle Post-Intelligencer.
The Palm Beach Post reported on the 10 newspapers most likely to close soon. See the following article.
But before you spend too much time worrying about the future, step back and take a look at the big picture.
Look down that list of troubled papers and try to find one community paper, paid or free. Not one. Is that because only the big boys get press coverage? Partially. Is it because community papers are unaffected by the recession and the Internet? No.
But our industry is not on the brink of extinction. Yes, times are tough. Revenues are down, expenses are up and no one has been operating more than a "bare bones" operation for several years. It's a tough market and you all are feeling it.
Local publisher Dwight Bitikofer published a column recently stating that the stats he sees for community papers indicate a decrease from a year ago of about 6.6%. He said that was consistent with his papers in his market and discussions he'd had with other publishers. It's consistent with our tracking surveys, too. The Northeast, Florida and California are getting hit a little harder, but some rural markets are actually growing.
Believe me, 6.6% decreases are nowhere near the revenue falloff of the major dailies listed above. Many are down more than 20%, some much more.
Saddled with major debt commitments, they are simply running out of cash. And, lenders don't see much future in holding on to papers that are losing cash on a daily basis. Neither do potential buyers.
Point here is that community papers are faring better than major dailies. While we have our issues with which to deal, we are not on the brink of collapsing.
And therein lays the opportunity. What do you think is happening in Denver (where the economy is not that bad off) with a major daily newspaper shutting down? Thousands of advertisers are rethinking their advertising package. Surely many will fall into Dean Singleton's lap at the Denver Post. But many are already advertising there and may see the suburban papers (paid and free) as alternatives. That creates opportunity.
The limited news coverage of community issues printed by both dailies will evaporate under the new monopoly leaving suburban papers with unfettered readership.
Doors that may never have been open to our industry suddenly are wide open.
It may take a while for this economy to come back. But it always does, and it will this time around, too. When it does, our industry will be well suited to step in to the void left by closed daily newspapers.
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Ten most likely newspapers to shut down in the next 18 months
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The Daily Clips, published by the Palm Beach Post, reported on the 10 most likely newspapers to shut down in the next 18 months. They are:
- Philadelphia News (in Chapter 11)
- Minneapolis Star & Tribune (in Chapter 11, owned by Avista Capital Partners)
- Miami Herald (owned by McClatchey)
- Detroit News (owned by Dean Singleton's Media News Group)
- Boston Globe (owned by the New York Times)
- San Francisco Chronicle (owned by Hearst)
- Chicago Sun Times (now trading for $0.03 per share)
- New York Daily News (owned by real estate billionaire Mort Zuckerman)
- Fort Worth Star Telegram (owned by McClatchey)
- Cleveland Plain Dealer (owned by Newhouse)
(It should be noted that the Daily Clips considerd the Seattle Post-Intelligencer well past death's door. The newspaper is publishing at this time, but most likely will shut down within days.)
While free papers are stuggling with revenue declines, some dramatic, overall our industry is in much better shape than the dailies. As these newspapers close, literally thousands of advertisers will need to find a way to distribute their information to readers.
This creates real opportunities for free papers, whose connection with readers is stronger than ever. Circulation is increasing and readership is strong!
Click here to download the entire Daily Clips Report.
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Cheers,
Craig McMullin
AFCP
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