Most newspapers were just hanging on in 2008, but things got a lot worse in the first quarter of 2009.
The New York Times reports that some newspapers saw their ad revenue plunge 30% in the first three months of the year compared to the same quarter in the prior year. The decline in spending brought about by the recession is combining with the flight from print to devastate publishers.
According to the Times, industry analysts and executives "are expecting declines sharp enough to wipe out profit margins at many papers that, despite two years of battering, had stayed comfortably in the black, and to push already-weak publishers closer to bankruptcy, perhaps even closure."
Small town newspapers have fared better than those with a national focus because they are less vulnerable to online competition.
I can't help but wonder how long it will be before the newspaper industry starts demanding its own version of TARP. Think about it: They employ tons of people -- many of whom belong to powerful unions -- and perform a valuable public service. Without well-staffed newspapers, the task of investigative reporting and muckraking will fall to bloggers who measure their value in pageviews and clickthroughs -- which means that Britney Spears will win out over the next Bernie Madoff every time.
Of course funnelling public money into The New York Times Co. (NYSE: NYT) is patently ridiculous, but I think you'd be hard-pressed to draw a distinction between that and bailouts for the auto industry and bonuses for failed bankers.
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Reader Comments (Page 1 of 1)
7-09-2009 @ 8:56AM
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