March 24th, 2008
Of all media industries assaulted by changes wrought by the Internet, it’s a toss-up as to which is considered the more beleaguered, newspapers or music. Not an enviable prize for which to compete.
Certainly both receive plenty of coverage of their varying woes — their problems are not well-kept secrets. But I’ve not seen such a damning indictment of the newspaper industry as the one appearing in today’s New York Times. In an article titled “Newspapers’ New Owners Turn Grim,” journalist David Carr focuses in particular on the wealthy (and dare I say egotistical?) individuals and/or their private equity firms who convinced themselves in the last several years that newspapers looked like a good bet for the future.
Opinions are apparently rapidly changing. According to an article quoted from The Baltimore Sun, Sam Zell, “the motorcycle-riding real estate mogul who took control of Tribune in an $8.2 billion sale in December, ‘The news business is something worse than horrible. If that’s the future, we don’t have much of a future.'”
Brian P. Tierney, who bought The Philadelphia Inquirer and The Philadelphia Daily News in 2006, is quoted in The Times article saying “I’m an optimist, but it is very hard to be positive about what’s going on.”
David Carr notes that the newspaper industry has not yet hit the bottom of the rocky shoals. Last year overall newspaper revenues dropped by about 7 percent, he notes, but meanwhile publishing, like so many other industries, is only now confronting the second whammy: the U.S. recession. He quotes one (anonymous) analyst predicting a 15% revenue drop in 2008.
Further, newspapers are undercutting their own chances of bouncing back after the recession because in order to weather the current downturn they’re cutting staff, undermining the quality of their product, and any likelihood of readers (and advertisers) rushing back in the future.
It’s a terribly grim picture of this once-grand industry.