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Marking 40 Years of Newspaper Research Journal

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Marking 40 Years
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of Newspaper DOI: 10.1177/0739532919900639

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Research Journal
At the end of 2019, Newspaper Research Journal (NRJ) marked 40 full years of pub-
lication. To mark the occasion, NRJ publishes here revised and edited versions of five
presentations made during a panel discussion at the 2019 Association for Education in
Journalism and Mass Communication (AEJMC) convention in Toronto. The panel,
co-sponsored by the Media Management, Economics, and Entrepreneurship Division
and the Electronic News Division and organized by Marc Edge, University of Malta,
was titled “Why Are Newspapers Still Here?” More than 80 audience members
attended the session.

Why Are Newspapers

Still Here?
By Marc Edge
Why are newspapers still here? It’s very simple. Newspapers are still here because
they still make money. Not as much as they used to make. They used to make an
obscene amount of money. Now they are having to cut costs as fast as they can just to
keep their heads above water. But newspapers are inherently profitable thanks to some
economic features such as vertical integration, elasticity of demand, and economies of
scale. So, while they have slimmed-down considerably, they are still publishing profit-
ably despite what you may have heard elsewhere. Meanwhile, digital media, which
have been widely touted to replace print media, have struggled to find a profitable
business model. If they don’t, how can they replace print media if the latter are making
money? Caught in the middle, of course, is journalism, especially local news cover-
age, which is what gets cut back most, to the detriment of democracy. It’s a conundrum
that policymakers are confronting differently in different countries. In Canada, the
apparent solution is to throw money at media, as subsidies worth almost $600 million
(about US$450 million) were announced in the last federal budget. That country’s
news media are now fighting over how to divvy up the loot, and it looks like most of

Edge is associate professor of media and

communication, University of Malta. Edge is the
corresponding author, marc.edge@um.edu.mt.
Article 9

it will go to old media—newspapers—to prop them up. And in Canada that unfortu-
nately means most of the money will be going to New Jersey hedge funds. It’s a long
story.
Let’s start at the beginning. This is the 10th anniversary of the so-called Newspaper
Crisis. After the long-publishing Rocky Mountain News folded and the Seattle Post-
Intelligencer went online-only in the depths of a global recession in early 2009, pre-
dictions ran rampant that dozens, hundreds, or even thousands of newspapers would
soon fold. Michael Wolff predicted that, “About 18 months from now, 80 percent of
newspapers will be gone.” USA Today predicted that, “At least one city—possibly San
Francisco, Miami, Minneapolis or Cleveland—likely will soon lose its last daily news-
paper.” Time magazine warned on its website: “It’s possible that eight of the nation’s
50 largest daily newspapers could cease publication in the next 18 months.” In the
United Kingdom, whose newspaper industry I have been studying most recently,
media analyst Claire Enders predicted to a Parliamentary committee in 2009 that up to
half of the country’s 1,300 local and regional newspapers would close within five
years. “Many titles are already running at losses and are being sustained by the good
graces of their owners,” she testified, “and that may not last.”
Of course, 18 months passed and far from 80% of American newspapers were gone.
None of the nation’s 50 largest daily newspapers had ceased publication. San Francisco,
Miami, Minneapolis, and Cleveland still had a daily newspaper. They still do. After
Denver and Seattle, the contagion was confined to Tucson and Honolulu. The reces-
sion gradually eased, but more importantly, newspapers proved incredibly resilient,
able to cut their costs almost as fast as their revenues fell frighteningly by one third and
then by half and now more. Unfortunately, they were only able to cut costs so quickly
by throwing journalists overboard, so while the outlook may have brightened some-
what for newspapers, it only darkened for journalism. None of what I am saying should
be taken to mean that newspaper journalism is thriving. Quite the opposite. I am only
saying that newspapers as businesses are hanging in there and should for the foresee-
able future.
In the United Kingdom, five years passed and only about 100 newspapers had
closed instead of the 650 Claire Enders predicted. Most of those were free sheets that
had proliferated in the 1980s to soak up all the ad revenue, what we would call “shop-
pers.” The only paid regional daily to close was the Liverpool Post, which was a sec-
ond-place newspaper. In Canada, only one daily folded during the recession of
2008–2009, in Halifax. It was immediately resurrected, incidentally, as a free com-
muter tabloid, Halifax Metro.
This is also the fifth anniversary of my book Greatly Exaggerated: The Myth of the
Death of Newspapers (2014), which examined the finances of publicly traded newspa-
per companies in the United States and Canada going back to 2006, before the reces-
sion began. It found that none had suffered an annual loss on an operating basis over
an eight-year period and that most were posting double-digit profit margins, with some
in the 20% range. Of course, they were doing so on greatly reduced revenues as clas-
sified advertising mostly disappeared and digital advertising came nowhere near mak-
ing up the difference. Newspaper profits were a fraction of what they were before the
print advertising bubble burst in 2004. At the height of the boom, operating profits
were routinely above 20%, with some in the 30% range, as monopoly newspapers
could even approach 40% to 50% return on revenue. That is, they could keep 40 to 50
cents in profit for every dollar that came in the door as revenue. The dailies that folded
10 Newspaper Research Journal 41(1)

had all been second-place afternoon newspapers, which in a declining industry proved
to be an endangered species indeed. Newspapers aren’t dying so much as newspaper
competition is dying. The monopolies that remain are still mostly profitable.
Unfortunately, much confusion has been caused in the public mind by the multi-
million-dollar losses often declared by newspaper chains, which tend to grab the head-
lines. These are “extraordinary” losses only on paper, as under the accounting rules
companies are required to regularly revisit the value of their business. If it goes down,
as it invariably did for newspapers due to their declining revenues and earnings, that
loss has to come off the books somehow. It did so, under the accounting rules, through
the annual profit and loss statement as an extraordinary loss. On an operating basis—
money coming in the door minus money going out the door—newspapers still have
their heads well above water. That should be true indefinitely, as they have proven to
be quite scalable enterprises that can be made larger or smaller as necessary. It is
important to remember that newspapers began as small businesses, often one-person
operations. On their present trajectory, they are at worst on track to return to that
status.
Much confusion has also been caused in the public mind by declining circulation,
which is often pointed to as a harbinger of newspaper doom. This ignores the counter-
intuitive fact that most newspapers lose money on circulation sales. They of course
make it back and more from advertising. Cutting back on circulation has thus been a
way for newspapers to cut costs, as it is increasingly expensive to truck copies farther
and wider to readers of diminishing interest to their advertisers. At the same time, they
asked their readers to pay closer to the actual cost of producing a hard copy of the
newspaper, often doubling or even tripling subscription rates, as Iris Chyi has found.
Given the well-proven elasticity of demand for newspapers, many more readers than
not were willing to pay more. The truth is that newspapers now have more readers than
ever thanks to the internet. It’s just than most are reading it for free, and that has to stop
if newspapers are to survive.
Even more confusion was caused in the public mind by the dozen or so bankrupt-
cies of newspaper companies, which also tended to grab headlines. These were invari-
ably due to heavy debt loads taken on in making ill-advised acquisitions before the
print advertising bubble burst. The newspapers themselves remained profitable
throughout and thus continued to publish under new ownership.
Unfortunately, many of the new owners were hedge funds that had bought up their
debt at pennies on the dollar when the companies were facing bankruptcy. These so-
called “vulture capitalists” owe no fealty to journalism and are instead fixated on the
bottom line. They well understand the inherent profitability of newspapers, however,
and took over several major chains for bargain prices. The recent upsurge in their
acquisitions speaks to the continued profits to be made in the newspaper business.
The problem of hedge fund ownership has been seen nowhere more than in Canada.
Despite a supposed 25% limit on foreign ownership of newspapers, U.S. hedge funds
were able to acquire out of the 2009 bankruptcy of Canwest Global Communications,
the country’s largest chain, and the former family-owned Southam Inc., for which I
worked for almost 20 years. In a nifty piece of financial engineering, the hedge funds
kept most of the debt they had accumulated on the company’s books, ensuring they
would get paid first every month whether or not it made money. Unfortunately, this has
meant throwing even more journalists overboard just to service the debt held by its
Article 11

hedge fund owners. Renamed Postmedia Network, it took over the country’s second-
largest chain, Sun Media, five years later, giving it 15 of the country’s 22 largest dai-
lies. Despite promising not to merge the duplicate dailies it thus owned in five of the
country’s six largest cities, it merged their newsrooms in four cities shortly after
receiving approval for its takeover from the oddly impotent Competition Bureau. The
largest chains, Postmedia and Torstar, make profits in the 10% range. Postmedia made
$65 million in profit in its most recent fiscal year, while Torstar made $60 million, yet
they will soon be getting financial assistance from taxpayers. Their annual reports are
posted on their websites. Check them out if you don’t believe me.
In the United Kingdom, the picture is more varied. While in the United States I was
able to access the finances of only about 40% of the industry, as that is the segment
which is publicly traded on stock markets, and in Canada about 75%, in the United
Kingdom, I can get more than 100%. That’s because the regulator there, Companies
House, requires annual financial statements from all companies, whether publicly
traded or privately held, whether parent, holding, or subsidiary. While I was unable to
unravel the finances of News Corp. dailies in the United States because they were
lumped in with the company’s newspapers in Australia and the United Kingdom, not
to mention several book publishing divisions, in the United Kingdom you can get
separate financials for the Sun and the Times because they are published by separate
subsidiaries.
The results are interesting. The Times was for years a money loser for Murdoch as
a vanity quality daily, and before him the Thomson family of this town. It has actually
been making money for the past few years, however, since erecting a hard paywall
around its content. This began to reverse what has been called the “original sin” of
newspapers, which was giving their content away for free online. When you think
about it, that really isn’t a very good business model. A similar paywall around the
Sun’s content had to be dropped, however, for a lack of customers. The lesson was that
people will pay for quality, but they won’t pay for crap, an abundance of which is of
course available online for free. Most newspapers have now introduced a so-called
“metered” paywall online as perfected by the New York Times, which at last count had
more than 4 million online subscribers paying more than $800 million a year. Of
course, not all newspapers are the New York Times, but most can generate revenue
from online subscriptions, and today every bit helps.
Other U.K. newspapers have found their way by heading in different directions.
The Daily Mail has made money from online advertising, despite the digital domi-
nance of Facebook and Google, by creating the world’s most popular English-language
website. Unfortunately, its content is more clickbait than solid journalism. The
Guardian, which has kept its solid journalism free for all to read online, found the cost
was eating into its rich Scott Trust too rapidly, so it began selling memberships. Its
loyal readers responded by taking out more than a million of them, contributing tens
of millions of pounds to Guardian journalism every year and putting it on track back
to profitability. Most newspapers, however, have benefited from the metered paywall,
which was actually pioneered by the Financial Times in the United Kingdom. It proved
so successful there that it turned the business daily around from losing tens of millions
of pounds annually into a cash machine for which Nikkei paid £844 million in 2015.
That’s about a billion U.S. dollars.
12 Newspaper Research Journal 41(1)

It wasn’t supposed to be like this. The internet was supposed to bring a great flow-
ering of journalism online, but so far that hasn’t happened because nobody has yet
come up with a viable business model for digital news media. The economics of the
internet are exactly the opposite of what they are for newspapers, which are profitable
because they tend toward monopoly. The internet tends toward infinite supply and
under the first law of economics—supply and demand—that only drives prices down.
Digital startups can scarcely compete for advertising with Google and Facebook,
which have simply built a better mousetrap. Who would have predicted 20 years ago
that a search engine and a social network would be the most profitable digital media?
Yet, many somehow blame newspapers for not foreseeing this and instead getting into
those lines of business.
Newspapers will continue to publish in print because they have a robust business
model. It is often said that their business model is “broken,” but if you still have your
head well above water after your revenues have fallen by more than half, I’d say
you’re hanging in there pretty well. Plus there’s just something about print on paper
that people prefer, especially for longer reading. The advent of e-books, for example,
has hardly meant the death of printed books. Most importantly, print is also still a pre-
ferred medium for some types of ads because of its higher engagement levels and
favorable demographics.
We have of course recently had another newspaper casualty and thus seen renewed
predictions of the coming extinction of a medium. The long-publishing Youngstown
Vindicator sadly announced it is closing, but it had some unique problems in a
depressed area and was apparently not very well run. More troubling to me are recent
predictions by insiders Dean Baquet and Warren Buffett that newspapers will be going
away. Baquet gives most local newspapers five years, while Buffett predicts only a
few large dailies will survive, but I predict that these predictions will also prove at
least premature. Newspapers may no longer be the big fish in the news media pond,
but I predict they will remain one of many smaller fish swimming well for the foresee-
able future, both in print and online.

Why Going All

Digital Is Unrealistic
By Hsiang Iris Chyi
Since the late 1990s, the newspaper industry has experimented with a wide range
of digital technologies: from PC to post-PC devices (e.g., smartphones, e-readers, tab-
lets, wearables), from blogs to social media, from audio to video and to virtual reality,
and the list goes on. As Robert Picard (2009) put it, “it’s hard to find a technology that
news organizations don’t embrace” (para. 1).

Chyi is associate professor, School of Journalism,

University of Texas at Austin. Chyi is the
corresponding author: chyi@mail.utexas.edu.
Article 13

The 2008 recession instilled among newspaper executives a sense of crisis and an
even more determined mind-set toward digital transformation. In 2010, about half
(46%) of American adults reported accessing news online 3 days a week or more. This
was also the year remembered as when “Web tops newspapers as news source for first
time” or “Online news readership overtakes newspapers,” and the State of the News
Media report announced that “[f]or the first time . . . more people said they got news
from the web than newspapers” (Rosenstiel & Mitchell, 2011, para. 11). Most news-
papers acted upon the assumption that the future of news is online, while in fact, it was
mostly news aggregators (such as Yahoo! News) that dominated the online news scene
(Chyi & Lewis, 2009).
The reality is, the business prospect of U.S. newspapers’ digital operations is any-
thing but impressive. No one has figured out a working business model for their digital
products. The industry-wide digital advertising revenue increased only slightly from
$3.2 billion to $3.5 billion from 2007 to 2014 (Pew Research Center, 2015), and the
Newspaper Association of America (now the News Media Alliance) stopped releasing
such data after 2014. But three out of five publicly traded newspaper firms reported
declines in their digital ad revenue in 2015—6% for the Tribune Publishing, 5% for
Gannett, and 1% for A.H. Belo (Barthel, 2016).
Additionally, digital subscription as a revenue source has also proven to be insig-
nificant (Doctor, 2017). The New York Times appears to be an exception, boasting 3
million digital news subscribers as of Q2 2019, but its print subscription revenue still
exceeds digital subscription revenue ($158 million vs. $113 million; “The New York
Times Company Reports 2019 Second-Quarter Results,” 2019). This is because print
subscribers are paying $1,053 a year for 7-day home delivery and digital subscribers
are paying $260—with introductory digital offers starting at $1 per week for a year.
Given this is the case for the New York Times, how much chance do other newspa-
pers have? A recent study on consumers’ demand for the top 50 U.S. newspapers’
multiplatform products answered the question. It was found that most of these news-
papers charged digital subscribers a fraction of the print subscription price but on
average attained no more than 6,000 subscribers with their Web and app editions—
which is about 6% of their print circulation at 101,000. It was estimated that digital
subscriptions contributed less than 3% of total reader revenue (Chyi & Ng, in press).
Since readership is the basis of advertising and subscription, the source of the rev-
enue problem is the lack of reader engagement. In other words, newspapers failed to
generate sufficient digital revenue primarily because they have never established a
substantial online reader base. This, however, appears to be an inconvenient truth in
industry discourse, but academic research has long documented newspapers’ digital
readership problem: The vast majority of newspapers failed to engage online readers.
Early studies on newspapers’ online and print readership conducted in different
markets (Chyi, 2006; Chyi & Huang, 2011; Chyi & Lasorsa, 1999, 2002; Hargrove
et al., 2011) have identified these patterns on consumer demand for newspapers’ mul-
tiplatform products: (a) Most newspapers’ print penetration exceeds online penetration
in their home market—that is, print readers outnumber online readers; (b) The major-
ity of a newspaper’s online readers still hang onto the same newspaper’s print
edition—meaning that online-only readers account for only a fraction of the combined
readership.
14 Newspaper Research Journal 41(1)

A recent study (Chyi & Tenenboim, 2017) reconfirmed these findings with 51
major U.S. newspapers’ online and print in-market readership data (collected by
Nielsen Scarborough in 2007, 2011, and 2015). All 51 newspapers’ print edition
reached more readers than the digital edition in their home markets (28.8% vs. 10%),
and the gap existed across all age groups. In addition, print-only readers (23.3% of the
local population) accounted for the majority of combined readership, followed by
hybrid readers (5.5% of the population), and online-only readers (4.5% of the popula-
tion). Finally, these newspapers’ in-market online penetration showed little or no
growth since 2007—9.8% in 2007, 10.7% in 2011, and 10.0% in 2015. More than half
of the newspapers under study experienced a decline in digital readership between
2011 and 2015.
In other words, after more than 20 years’ experiment with digital, not a single local
U.S. newspaper has made it digitally. But the good news is, these metro newspapers
still reached about one third (33.3%) of the population in their local market, and most
(86%) of them still read the “dead-tree” edition. This is good news because readers’
attachment to the print edition remains strong, as reflected in their response to the
industry-wide price hikes since the 2008 recession.
A study tracking the price of 25 widely circulated U.S. newspapers since the reces-
sion found that 7-day home delivery price more than doubled, and single-copy price
tripled between 2008 and 2016. Seven-day subscription cost $510 in 2016—that is,
$293 more than in 2008. Surprisingly, about two thirds of print readers remained loyal
to a lesser product that has become so much more expensive (Chyi & Tenenboim,
2019). In contrast, the vast majority of news consumers were reluctant to pay anything
for the same newspaper’s online products (Chyi & Ng, in press).
In sum, the legacy product, which has long been considered “dying” by many, still
outperforms the same newspapers’ digital offerings in terms of readership, engage-
ment (Thurman, 2014, 2018), subscription, and advertising revenue—all by a wide
margin. One lesson that should have been learned by now is that newspaper readers are
anything but “platform-agnostic.” The key lies in readers’ stronger-than-expected
attachment to the print format. With an attachment this strong, print does not have to
die.
Scholars have long pointed out that online news is an inferior good (like Ramen
noodles), and online news and print newspapers coexist as a combination of an inferior
and a normal good (like steak; Chyi, 2015; Chyi & Yang, 2009). This provides an
explanation for the print-online performance gap, which would be difficult to interpret
otherwise.
As of 2019, the reality is that newspaper readers have never responded enthusiasti-
cally to newspapers’ digital offerings. With already dwindled resources, newspapers
can no longer afford pursuing unrealistic digital dreams. Instead, they should re-focus
on quality journalism and deliver it through preferred platforms. Unfortunately, the
industry’s technology-driven approach has largely remained unchallenged, and so has
the “pro-digital, anti-print” mentality.
Print does not have to die, but it may die as a result of a self-fulfilling prophecy.
Audience research is of paramount importance because the future of any product is
determined by consumer demand as opposed to wishful thinking.
Article 15

What If Newspapers Are

(Slowly) Dying
By Kelly Kaufhold
I’d like to thank my friend, Dr. Edge, for so ably arguing my case in his introduc-
tion. Circulation and advertising revenue are down dramatically at newspapers across
the country. The numbers are bleak, stark, and have accelerated since the Great
Recession (Lekach, 2017):

•• Nationally, circulation is half what it was in 2008;

•• Advertising is down two thirds since its peak in 2008;
•• 2,000 papers have closed since 2008;
•• There are half as many newspaper jobs as there were in 2002;
•• 1,300 communities no longer have any local newspaper, radio, or TV news
outlet.

Dr. Edge also notes the decline and merging of prominent newspaper ownership
chains: Knight Ridder sold to McClatchy (which lost $27.5 million in the fourth quar-
ter of 2018; Anderson, 2019); A.H. Belo shed its broadcast entities; the two largest
newspaper ownership companies, GateHouse and Gannett, are about to merge into the
largest. The GateHouse brand is only a dozen years old, although it grew out of another
newspaper ownership group founded 20 years ago. GateHouse Media is owned by
New Media Investment Group. This isn’t meant as a criticism because the GateHouse/
Gannett model appears to be the near-term future of the newspaper industry. Four
years ago, GateHouse bought Halifax media group with three dozen newspapers. Over
the next 3 years, GateHouse acquired Stephens Media in the west; Harris Enterprises
and Dix Communication in the Midwest—that was followed by multiple purchases on
both coasts. The company acquired its biggest properties in 2018 with the purchase of
the Austin American-Statesman and the company that owns the Oklahoman, the larg-
est circulation newspaper in Oklahoma. In almost every case, across dozens of news-
papers, within months of the purchases employees were offered buyouts or faced
layoffs. GateHouse and Gannett announced their intent to merge in August, 2019—
and 1 week later, GateHouse cut staff at four papers, including the Oklahoman (Jones,
2019). Gannett’s layoffs in 2019—400 jobs at papers from the newly acquired New
Jersey Media Group—were described as “a bloodbath” in the hyperbolic New York
Post (Kelly, 2019). Dr. Edge rightly notes that there must be value in newspapers
because they’re being snapped up by hedge funds but it’s essentially a race to the bot-
tom, aggressively wringing blood out of a shrinking turnip.
GateHouse is aggregating more than ownership. One area of growth in the com-
pany is a central editing and web support office, the Center for News and Design,

Kaufhold is associate professor of digial media, Media Innovation Lab,

School of Journalism and Mass Communication, Texas State University.
Kaufhold is the corresponding author: kellykaufhold@txstate.edu
16 Newspaper Research Journal 41(1)

which has grown rapidly from fewer than 200 employees when it opened in 2014 to
more than 300 now. Most of the 144 newspapers owned by GateHouse use some ser-
vices through the centralized Center and even papers not owned by GateHouse are
clients. The Dallas Morning News contracts with the entity for copy editing even
though GateHouse doesn’t own the paper. The Center for News and Design is both a
revenue stream for the corporation, and a skills touchstone, which allows more layoffs
with each new acquisition.

A Pessimistic View
Recent newspaper economic scholarship has rightly pointed out that digital revenue
hasn’t come close to compensating for lost print revenue. Yes, print still generates the
overwhelming majority of a newspaper’s advertising income; but that revenue is down
precipitously since the great recession. U.S. newspaper advertising revenue, in the
aggregate, peaked in 2006 at $49 billion. By last year, it plummeted to one third of that
value, $14 billion (Pew Research Center, 2019). Digital ad revenue has grown steadily
and, in fact, passed the 50% mark of all U.S. ad spending just this year. Of $238 billion
spent on advertising across the country, $129 billion was spent on digital, and nearly
half of that on mobile advertising. But your local newspaper likely didn’t make much
on their app or website because Facebook, Google, and Amazon siphon off nearly two
thirds of all digital ad revenue (Shields, 2019). The argument that newspaper revenue
still overwhelmingly lies with the print edition is true—but it’s folly. Yes, print ad
revenue dramatically outperforms digital ad revenue for the overwhelming majority of
newspapers—in fact, there are only a few exceptions: Financial Times, The Times of
London, The Guardian, all in the United Kingdom, and the New York Times, which
enjoys perhaps more than 3 million digital subscribers. The reason is that print ad
revenue, each year, is the biggest slice of a shrinking pie . . . meaning the total share of
print ad revenue is not just declining, it’s plummeting. The Boston Globe recently
crowed that it had achieved a milestone by counting more digital than print subscrib-
ers. Digital subscriptions were up by about 5,000, but print subscriptions dropped by
10,000, putting print subscription below 100,000 for the first time in the storied paper’s
history (Benton, 2019a). Print advertising revenue will always be greater than digital
ad revenue for all but a select few, but it will almost certainly be less than it was last
year or the year before. And digital subscription revenue will never compensate for
lost print revenue—in fact, our colleague Dr. Iris Chyi, in this issue, has ably argued
that it may take as many as 20 online readers to generate the same ad revenue as a
single print subscriber.
Even a big news event, like a 2016 presidential election, helps only very selec-
tively. The New York Times added half a million new digital subscribers in 2016; The
Wall Street Journal captured another 150,000 new digital subscribers. But newspapers
nationwide lost 8% of digital subscriptions, in the aggregate, even in that highly con-
tentious election year (Barthel, 2017). And this is the lesson of contemporary media: a
handful of highly prestigious brands—New York Times, The Wall Street Journal;
Google, Facebook—will subsume the lion’s share of revenue, leaving 1,280 or more
print newspapers, and thousands of more diverse media websites, to fight over scraps.
Dr. Edge shares the tale of a litany of newspapers either in decline, attempting to
migrate to reduced publication, or now online-only. The saga of Advance Publications
Article 17

and the New Orleans Times-Picayune in 2012 is an illustrative example of the futility
of these efforts. Advance Publications bought the Times-Picayune in 2012, promptly
reduced publication to 3 days a week, and laid off 200 employees. Advance owns
about 100 media properties around the country. A blogger in Louisiana in 2012 posted
a provocative assertion: that the Times-Picayune didn’t die a natural death but that it
was murdered for money. I agree that it was murdered, but not by Advance; it was
killed by readers who quit buying it. Circulation plunged from a quarter million in
2005 to less than 90,000 in 2012. By 2016, the Baton Rouge Advocate was selling
more copies in New Orleans than the hometown paper. In fact, in 2019, the Advocate
bought the Times-Picayune and laid off all 161 of the staff, including 65 reporters and
editors (Burch, 2019). The Advocate is now the top circulation newspaper in
Louisiana—yet another example of inevitable consolidation. The Advocate, by the
way, has a substantial advantage over many other newspaper companies: it has a single
owner, John Georges, who is a multimillionaire from other industries: grocery stores,
video entertainment, and so on, so no shareholders to worry about. And here’s another
illustration of the importance of conglomeration and nationalization. Advance is the
11th biggest media company on a list from Business Insider, just behind some very
big, recognizable corporate names: News Corp., Viacom, Comcast, 21st Century Fox,
Disney, Facebook, and Google. All are multi-media or global media companies.
Owning 100 newspapers seems to pay a lot better than owning one—Advance has a
corporate office in the new World Trade Center.

Primacy of the Elites

There are a few newspaper brands which dwell in a heady land of profit and growth.
The Wall Street Journal, New York Times, and Washington Post are certainly among
the highest digital subscription newspapers in the country, although all three refuse to
report their total online subscriptions. For perspective, the New York Times reported in
2019 that it had reached 3.5 million online subscribers with another million subscrib-
ers in print; the Washington Post reported passing 1 million online subscribers last
year; The Wall Street Journal, which has always had a substantial, willing subscriber
base because of its uniquely intrinsic market content, likely falls in between. Pew data
suggest the top-50 circulation papers in the country altogether share about 11.5 million
online subscribers—and yet this trifecta of East Coast national papers accounts for
more than half of total national online subscriptions. For perspective, the Los Angeles
Times, despite an aggressive recent push across the staff to increase digital subscrip-
tions, sits intransigently at 170,000 (Benton, 2019c). Much like Google, Facebook,
and Amazon, the saga of digital newspaper subscriptions is largely the story of just
three elite newspapers.
As Dr. Edge rightly notes, the doomsayers of a decade ago were wrong. No, half, in
fact even one fifth of American newspapers did not close; almost all major market
dailies remain in publication; even some papers that had folded or slimmed-down had
a resurgence. But that ignores the fact that nearly all of these papers have had revenue
losses and staff cuts. Some have taken more draconian measures. Dr. Edge mentions
the Miami Herald and it is still, indeed, producing news in print and online, but the
Herald abandoned its glorious Bayfront building in downtown Miami in 2013—50
years after moving into it—partly because of a quarter billion dollar offer ($236
18 Newspaper Research Journal 41(1)

million) from a hopeful casino developer but partly because it was facing daunting
costs to maintain large waterfront property in the central business district. The Dallas
Morning News abandoned its storied downtown property—just blocks from the infa-
mous Dealey Plaza—after nearly seven decades. The building’s legendary Rock of
Truth, citing the newspaper’s devotion to integrity and objectivity, still stands proudly
in front of the empty building.
Comparing U.S. newspapers with those in Europe, China, and India isn’t quite fair.
U.K. newspapers aren’t subsidized by taxpayers in the same way their broadcasters
are, although there have been appeals this year for government subsidies to support
local newspapers. But those papers have long benefited from substantial government
advertising that they could count on as a steady revenue stream in their pages
(Greenslade, 2012). Advocates for subsidies point out other industries that failed to
react quickly enough to the digital revolution, like Blockbuster Video and Kodak, and
say that digital behemoths, Google and Facebook, dominate digital advertising
(Waterson, 2019). All true. But that selectively ignores two truths. First, Blockbuster
(2010) and Kodak (2012) each filed for bankruptcy and either folded (Blockbuster) or
substantially altered their core businesses (Kodak exited the camera market). Second,
Rupert Murdoch, Robert Maxwell, the Rothermere family, the Astors—all earned mil-
lions, even tens of millions of dollars, owning newspapers over the decades. The rea-
son is that, like Google and Facebook, they dominated audience attention and
advertising in their era. Newspapers were about an informed populace, holding leaders
to account—but they were also, always, about money.
By the way, this robustly applies to U.S. newspaper owners. Joseph Pulitzer had a
net worth of $30 million in 1911; William Randolph Hearst lived in a castle, for crying
out loud! Even local media more than kept the lights on for their owners. The University
of Oklahoma has received more than $50 million over three decades from Edward
Gaylord and his family—he owned the Oklahoman (and some major broadcast brands,
including The Nashville Network—initially bought with profits from the Oklahoman).
Back to Dr. Edge’s examples, a number of European countries already subsidize
newspapers, including Finland, France, Italy, and Germany (Nielsen & Linnebank,
2011). The Guardian clawed its way back into the black with an aggressive, obtrusive
appeal for donations that greets visitors in the form of a half-page, yellow ad on most
visits. In China, despite his noted optimism, a dozen of advertising-based newspapers
have folded in the last year. That’s mostly due to censorship by the government which
drove away readers, but the main newspaper, The People’s Daily, is secure in the
knowledge that, as the Communist party organ, it is impervious to economic condi-
tions. Three unique factors have fueled newspaper growth in India: (a) a growing
population; (b) a sharp increase in literacy and education due to an exploding econ-
omy; and (c) a sharply growing middle class, interested in news, information, and the
status of reading newspapers (Santhanam & Rosenstiel, 2011). In India, in fact, it’s
now common for people to read more than one newspaper daily. That clearly isn’t
analogous to the U.S. newspaper industry and hasn’t been since the 1960s.
The litany of substantial profit margins noted in the previous manuscript (as high as
24.7%) is compelling, especially in the contemporary media environment. But the
paragraph preceding those margins quantifies the price of those profits—layoffs num-
bering in the thousands, even across entire large ownership groups like Gannett. And
all this coincides with relentless declines in circulation. Eventually, there will be no
Article 19

more reporters to lay off, no more readers to wring higher subscription fees from, and
no more margins to squeeze from an industry in decline. Among newspapers, print
generates far more revenue than digital—on this, we all agree. Yet, readers aged 65
and older are five times more likely to subscribe to print than digital (“Print vs. Digital
Subscribers: Demographic Differences and Paths to Subscription,” 2017). The median
age of a print newspaper reader is 57.9 and rising every year (Conaghan, 2017). The
clock is ticking.
There’s another important artifact of ownership aggregation, which we see mani-
fest with Gannett and GateHouse: less local coverage and more local papers running
the same corporate packages of stories. GateHouse’s Center for News and Design in
Austin regularly produces print and web content which runs in dozens of outlets. It is
journalism, elegantly and expertly produced. What it isn’t, is local. Likely, that’s the
future of hedge fund and aggregate newspaper ownership—more centralized services,
like editing and web support; yielding less need for those services (hence, fewer jobs)
across hundreds of local papers; and more repetitive, national, or lifestyle content—
but less local reporting. This will also extend to media companies owning multiple
properties across media—newspaper, radio, and TV and, in fact, we already see it
among the large television ownership groups, like Nexstar and Sinclair. The “same-
ness” can also mean a message favorable to one political identity or to a corporate
strategic goal (Bryant, 2018; Mayhew, 2018).
The increase in revenue from reader revenues (meaning subscriptions, paywalls,
and per-story purchases) is also misleading. Reader revenue is rising as a proportion
of newspaper revenue but, as I noted earlier, it isn’t rising much at the overwhelming
majority of newspapers. Where reader revenue does surpass advertising revenue, it’s
most often a scenario like that of the Boston Globe: a slight increase in reader revenue
glancing over its shoulder at the declining subscription revenue as it hurtles past. Also,
reader revenue overwhelmingly goes to a handful of elite newspapers with online
subscriptions numbering at 1 million or more, a form of direct digital competition
against America’s other 1,280, or so, newspapers (Organisation for Economic
Co-operation and Development, 2010).
As for the inelasticity of price increases, I would argue that any data before 2019
are badly dated in that arena. Print newspaper readers tend to be older, even retired,
which often suggests a fixed income. At some point, in keeping with the Laffer curve,
price increases will yield unintended changes in behavior, driving away the most loyal
readers. A loss of “only” 20% of readers isn’t exactly inelastic. Maintaining prices at
high levels, or even increasing them, even threatens to impose a financial burden on
the most loyal readers of print news. Dr. Edge’s own data suggest limits to this strat-
egy. Circulation revenue rose, on average, by 12% during the same period that circula-
tion fell by 30% (Edge, 2020), and don’t forget that advertising revenue fell by half in
that same 2011 to 2017 window (Pew Research Center, 2019). There is a limit to loy-
alty. As noted in the Hagey and Alpert (2019) study, paywalls tend to favor a select
handful of major brand newspapers but don’t provide enough compensatory income to
smaller papers to offset the loss in print ad revenue. While a few East Coast national
papers enjoyed increased digital subscriptions, total print and digital circulation
nationally fell year-to-year in 2019 by 12% for weekdays and 13% for Sundays (Pew
Research Center, 2019). In fact, out of deference to newspapers dwindling revenue,
the Audit Bureau of Circulation a decade ago cut its price and offered newspapers an
option to pay for audits only every other year (Johnson-Greene, 2008). Even for ABC,
the writing is on the wall. Again, the clock is ticking.
20 Newspaper Research Journal 41(1)

Dr. Edge lists the success of paywalls among 450 of the country’s 1,380 daily news-
papers, singling out Lee Enterprises, McClatchy, and E. W. Scripps. Let’s examine the
success of those paywall efforts one-by-one. Lee Enterprises publishes 46 daily papers,
making it the fourth largest newspaper ownership group in the country. But that’s
down from its peak in 2011 when Lee filed for bankruptcy to restructure $1 billion in
debt (“Newspaper Group Lee Enterprises Files for Bankruptcy,” 2011). McClatchy
restructured $794 million in debt last year as its share price plummeted. Chatham
Asset Management, which is based in New Jersey and owns the National Enquirer,
snapped up 20% of McClatchy’s depressed shares (Edmonds, 2018). Chatham was a
major lender to McClatchy and bought the shares to hedge the debt risk. E. W. Scripps
has shuttered its Scripps Howard News Service and half a dozen papers in Alabama,
California, Colorado, and New Mexico over the last 20 years, and then sold all of its
newspaper holdings in 2014, migrating entirely into TV (“Scripps to Sell Newspapers,
Including Commercial Appeal,” 2014; Turner, 2013). In the same way, noting the suc-
cess of the Toronto Star is much like noting the success of the New York Times—it’s an
isolated case involving the nation’s pre-eminent newspaper in the city that is home to
13% of the country’s population. Using aggregate national numbers for things like
circulation, digital subscribers, and online ad revenue is misleading because the over-
whelming majority of those 1,380 daily newspapers, and most of those 450 with pay-
walls, is that they’re fighting against inevitably shrinking pools of readers and revenue
while a tiny handful of elite national newspapers and internet media behemoths sub-
sume all the attention, subscriptions, and ad revenue.

Google and Facebook (and Amazon) versus The World

Speaking of behemoths, optimists took heart in two initiatives from Facebook and
Google, which each recently pledged $300 million to support local news: Google in
2018 and Facebook in 2019 (Kafka, 2019). Some of Facebook’s money will go directly
to initiatives to try to improve journalism at the Pulitzer Center and Report for America,
which will research strategies to help local news outlets; some of Google’s contribu-
tion will go toward media literacy training and fighting disinformation online (Glover
& Beard, 2018). All worthy aims. But the main goals of both initiatives are to steer
newspapers more toward subscription models—conveniently using Google and
Facebook credentials to log in—and to steer clear of digital advertising. Recall Dr.
Edge’s observation that profit margins among some U.K. newspapers reached as high
as 24.8%. Facebook’s profit margin was 37% in 2018, despite the Cambridge Analytica
scandal and the company’s questionable handling of user data. Of course Facebook
and Google want to steer newspapers (and everyone else) away from ad revenue—so
they can continue working to corner the market. If anything, they’re more worried
about Amazon than they are about saving local newspapers. And on the topic of data,
allowing users to sign in to local papers all around the country using Google and
Facebook credentials means all of those local papers are handing over their reader
data, for free, to those digital giants, which they can (will!) package and profit from.
By the way, Google and Facebook not only dominate current digital advertising but,
along with Amazon, their share is growing the fastest. An article in Vox described it as
“an irreversible trend” and asserts that, if a new entity ever does knock them off their
perch, it will certainly be digital, not print (Kafka, 2018).
Article 21

Facebook’s newest initiative is an effort to partner with news outlets to curate high-
quality information to be distributed with Facebook’s imprimatur of quality through
the social network—and Facebook will, finally, pay publishers millions of dollars for
their expertise and content. But this will contribute to the elite narrowing that is already
robustly underway among news users. Facebook won’t partner with everyone, and
certainly not with just anyone. The Dayton Daily News, Indianapolis Star, Dothan
Eagle—they won’t see a penny from this effort. It will largely fund elite Northeast
media outlets, including the aforementioned Wall Street Journal and Washington Post,
Bloomberg, CNN, Fox Business, Breitbart, and some others (Legg, 2019). It’s a
diverse group by political ideology but not by financial or geographic diversity.
In the same way that the advent of evening television news hurt afternoon newspa-
pers, the migration of media consumption to digital platforms, especially mobile
devices, is irrevocably damaging the old print delivery model—both eyeballs and
advertising (Davies, 2006). Note a citation from Morton (1994) with a quaint reference
to how newspapers seem to weather economic downturns better than most industries.
That may have been true 20 years ago but it sure wasn’t true during the Great Recession
of 2007 and 2008. Readership is half what it was before the recession; ad revenue is
only one third what it was. Newspapers were hit, and hard, by the economic downturn
because this one didn’t fit the old recessionary model. In past decades, newspapers
would suffer because their advertisers might slow revenue as a result of their own finan-
cial difficulties (retailers, auto dealers). But in 2007, the devil was digital. Facebook
and Google were maturing and Apple launched the first iPhone that year. No, this
wasn’t a typical, small, temporary slowdown in the newspaper model—this was digital
disruption writ large; a firehose of competition like the legacy news industry had never
seen before. Newspapers, radio, and television news outlets (and the rest of us) looked
on—in fact, heartily contributed—as Google and Facebook reached $1 billion, then
$10 billion, then tens of billions in annual revenue. Amazon decimated booksellers,
then retail, and now the grocery industry—by the way, siphoning away the traditional
stalwart of local newspaper display advertising, the local department store.
Dr. Edge cites 1,380 daily newspapers in the United States (Statista says there are
1,286)—that’s down from 1,748 in 1970 (Statista, 2019). Rural residents of the United
States are increasingly likely to live in news deserts—counties with no local newspa-
per, radio, or television news. To be sure, these communities still have access to
information—in fact, likely access to more information than they could imagine 20
years ago, through their web-enabled smartphones (although some 21 million rural
Americans can’t get broadband access; Flahive, 2019). But “more than 500 of the
1,800 newspapers that have closed or merged since 2004 were in rural communities”
according to the The Loss of Local News: What it Means for Local Communities
(2019). Of the 3,007 counties (or parishes, etc.) in the United States, about half (1,528)
have just one newspaper—mostly a weekly—and 225 have no newspaper. These
smaller papers have been hit harder by dwindling print ad revenue (again, partly
because of the loss of local retailers in rural areas) and the migration from citizens in
these communities toward online news aggregators, like Google News, Yahoo! News,
Huffington Post, Drudge Report (Flahive, 2019).

Nonprofit Is Not a Model

Nonprofit news shows some promise, but it’s necessary to view the successes of
nonprofit news through a loupe. The Texas Tribune has been a gold standard for
22 Newspaper Research Journal 41(1)

nonprofit news outlets since it was founded in 2009. Co-founders Evan Smith and
Ross Ramsey emphasize two points which were vital to the Tribune’s early success
and its continued sustainability—only one of which is widely replicable. First, it
launched in a highly target-rich environment: Texas is home to more than 30 million
people, is geographically enormous with multiple population centers far flung from
the Capital, and by 2009 (heading into the 2010 election for Texas governor—the tim-
ing was not an accident), most state news outlets had shuttered their Capital bureaus.
Second, the Tribune’s approach to revenue is YES, PLEASE! It’s essentially revenue
agnostic: Memberships, advertising, foundation support, donations, events—about
one fourth of the Tribune’s revenue now comes from events, like the annual Texas
Tribune Festival each fall. Some $2 million of $7 million in annual revenue comes
from events—and the dollar amounts and proportion are growing each year, a key pil-
lar in the outlet’s stated mission to wean itself off foundation support (The Texas
Tribune, 2019). The Tribune now hosts events all over the state of Texas and they all
follow the same model: They host events on university campuses because colleges
don’t charge for venues; major sponsors, including Walmart and HEB, help cover
costs; in-kind donations, like food, are common; no guests are paid; and appeals for
memberships and donations take place at every one. Often, the events bring state law-
makers and citizens together into the same room and are also heavily covered by the
Tribune. To be sure, these events yield good journalism and are good for democracy,
but they’re also robust revenue streams.
Other nonprofit outlets follow similar funding models with some important differ-
ences. ProPublica pays for its investigative journalism with between $5 million and
$10 million in foundation support each year, including gifts from the Sandler
Foundation (Herb Sandler was a co-founder), the Knight, MacArthur and Ford
Foundations, Pew Charitable Trust, and the Carnegie Corporation. ProPublica and the
Texas Tribune—arguably the two most successful modern nonprofit outlets—employ
far fewer people than a traditional metro daily newspaper. ProPublica has about 100
total employees (including non-journalists, like coders, fundraisers, human resource
workers, etc.); Texas Tribune, about 75. GateHouse Media laid off more than 60 news-
paper employees just at the start of 2019; the Advocate laid off 65 journalists just from
the Times-Picayune (Burch, 2019; Goggin, 2019). Other models similar to the Texas
Tribune have emerged over the last decade, or so: STL Nonprofit News in St. Louis;
Voice of San Diego (15 employees); and MinnPost in Minneapolis (about 25 journal-
ists). But there doesn’t seem to be a magical path for a daily newspaper to migrate to
a successful nonprofit model—certainly not on a scale equal to the 28,000 jobs lost in
traditional newsrooms since 2008 (Grieco, 2019b).

Conclusion
The future of newspapers will involve three trends: consolidation, centralization,
and nationalization. More owners, especially investment houses like New Media
Investment Group (owner of GateHouse Media), Chatham Asset Management
(American Media), and others, will aggregate even more newspaper properties under
one ownership umbrella (i.e., the GateHouse/Gannett merger, involving 260 newspa-
pers). “Collect” used to mean paper deliverers getting paid on Saturdays for bringing
households the news all week—now it means hedge fund aggregators adding to their
Article 23

newspaper portfolios. This is also happening rampantly in television news: Nexstar

Media Group, the largest owner of TV stations, counts 197 stations, which reach 63%
of the U.S. population (Nexstar, 2019). More content in those aggregated papers will
be centralized, with the same content appearing in more publications while original,
local content appears in fewer, and less often. And all along, more readers, more rev-
enue, and any remaining newsroom jobs will migrate to national news outlets on the
coasts—and mostly in the Northeast. Pew, by the way, reports that one in five people
still working in daily journalism now live in New York, Los Angeles, or Washington,
D.C. (Grieco, 2019a). All of this stems from 50 years of dwindling readership, with so
many millions of us abandoning our subscriptions to local newspapers, accelerated to
light speed by our migration to digital, mobile, and social media. We quit valuing local
print news. I’ll bet you’ve read news today on a mobile phone—maybe you’re reading
this article on one. Nobody lights their home with whale oil anymore.
Yes, the doomsday scenarios uttered by naysayers a decade ago were wrong, but
only about the precipitancy of the decline. Newspapers aren’t dying from a cata-
strophic trauma. No, their demise is slow, gradual—agonizingly so. In Shakespeare’s
epic, Antony thusly lamented the death of Julius Caesar: “Woe to the hand that shed
this costly blood!” The killer is us.

Of Cash Cows, Dogs,

and Dead Cats
By Mitch McKenney
It’s hard to say if those of us who have worked for and study newspapers should
view our colleague Marc Edge’s contrarian theory—they’re still here, see?—as opti-
mistic, Pollyanna, or a cause to get behind. He’s right that the advents of radio and
television also brought predictions of the newspaper industry’s demise, that few have
closed in the past decade, that most newspapers still make at least some money a
decade after the recession, and that some have made a lot of money.
Among those in my journalism educator and still-in-the-newsroom circles, bring-
ing up Edge’s theory is somewhat of a Rorschach test, as some swoon but more expect
the predicted demise of newspapers and view any rally as illusory—in stock market
terms, a dead-cat bounce. Edge didn’t really say newspapers are doing fine, only that
small, community news providers may yet survive if they embrace journalism and
“trust that a free market will find buyers for that.”
That’s presuming the hedge funds don’t kill them first. The Gannett–GateHouse
tie-up of 2019, now consummated, creates a need for immediate cash to pay for it; it’s
widely expected the new, larger Gannett will employ fewer journalists in a short time
(Edmonds, 2019). But while most newspapers are still here, and with Edge’s theory

McKenney is associate professor, School of Journalism and

Mass Communication, Kent State University. McKenney is the
corresponding author: mmckenne@kent.edu.
24 Newspaper Research Journal 41(1)

about print remaining viable, this response raises some points that belong in the
discussion.

Markets Tell the Story

To be sure, the purchases by hedge funds haven’t been to catch hot prospects on the
way up. It’s fair to say that newspapers had long been cash cows—that is, businesses
with high market shares but low growth, as defined by Boston Consulting Group’s
Growth Share Matrix (“What Is the Growth Share Matrix?” n.d.). Graphics depicting
the matrix, now approaching a half-century of use in boardrooms and business class-
rooms, include a picture of a milk cow. Most sources refer to cash cows fondly, as a
steady, drama-free source of revenue to invest in question marks that could become
stars.
The same matrix calls businesses with low growth and low market share “pets”—
usually with a silhouette of a dog. Plenty of investment advice tells you to get rid of
the dogs in your portfolio, that those are the properties to liquidate, divest, or reposi-
tion because they’re unlikely to ever generate enough cash to justify the effort.
One reframing of Edge’s theory is that newspaper companies, in their leaner forms,
can remain cash cows, though critics would argue these have been dogs for quite some
time. When McClatchy bought twice-its-size Knight Ridder in 2006, McClatchy was
boasting operating profit margins of 22.8%, while Knight Ridder’s was 16.4% (Seelye
& Sorkin, 2006). Now McClatchy hovers closer to 0%, while the best-performing
ones—New York Times at 10%, News Corp. at 6%—owe much of their success to digi-
tal revenues from their flagship New York Times and Wall Street Journal, respectively.
Onetime highflyer Gannett, having spun off its television business as TEGNA in 2015,
hasn’t cracked 3% since 2016. Language in earnings reports of newspaper-owning
companies routinely cite drops in print advertising and print circulation revenues. So
the hedge funds do what they’re designed to do: squeeze the operations to get the
remaining profits, sell off assets such as iconic downtown buildings, and not be con-
cerned about job cuts or journalism.
As it is, between 20% to 30% of total revenue comes from either digital advertising
or subscriptions, although at significantly diminished profit margins compared to print
advertising. But even with this success, newspapers face increasingly formidable com-
petition for that digital revenue. Research by Penny Muse Abernathy from University
of North Carolina–Chapel Hill suggests that as much as 80% of the digital advertising
revenue in many small and mid-sized U.S. markets goes to Google and Facebook.
Someone else got to the pot of gold, and newspaper publishers didn’t get the online ads
they hoped would buoy them as print advertising declined further.

Newsrooms as Tenants
In late October, 2019, employees of the Akron Beacon Journal cleaned out their
desks as they prepared to move a few blocks down the street, to rented office space in
a converted B.F. Goodrich tire plant (Price, 2019). Some posted nooks-and-crannies
images from the cavernous spaces where presses used to run, before they were removed
piece-by-piece 5 years ago. Other images showed empty spaces where hundreds of
people worked. John S. Knight’s office occupied the corner of the third floor of the
Article 25

iconic building at 44 E. Exchange St., where he built the Knight Ridder chain of news-
papers and hosted presidents and senators. They took a last official staff photo in the
newsroom that had produced four Pulitzer Prizes—26 people, plus 10 not pictured, in
a room that once held hundreds.
The list of venerable newspapers converting their headquarters to cash has become
an expected part of the life cycle, right after laying off reporters, editors, and photog-
raphers to boost margins. In Philadelphia, the city police headquarters is taking over
the space where the Inquirer more than once exposed police brutality. The Miami
Herald gave up its Bayfront plant and moved to the suburbs (Uberti, 2015). The Los
Angeles Times staff works in El Segundo. In the case of Akron, current owner
GateHouse didn’t get the building when it bought Beacon Journal from Black Press in
2018 for $16 million. Black Press had paid 10 times that when it took it off McClatchy’s
hands as part of the Knight Ridder sale.

Vindication for The Vindicator

In late June, 2019, the Youngstown, Ohio, Vindicator celebrated its 150th anniversary—
and 3 days later announced it would close on August 31 (Benton, 2019b). With a popu-
lation of 65,000, Youngstown was to have become the largest city in America without
a daily newspaper, depending on how you word that sentence.
The same region just lost a General Motors (GM) plant, so the reaction has been
framed as a newspaper industry story and as a sign that the regional economy is in
trouble. And it also has a political component, as President Trump has fired salvos
about whose fault it is that GM isn’t building Chevy Cruzes there anymore. And for as
long as the Democratic Party let Tim Ryan in its presidential debates, he talked about
Youngstown. The Maag-Brown family had endured losses for years and largely insu-
lated its staff from severe cuts, but it said couldn’t persuade GateHouse or another
chain to buy it. Joshua Benton (2019b), writing in Nieman Lab after the announce-
ment, saw the inability of the owners to sell to GateHouse or another chain as a bad
sign of things to come:

It’s the combination here that’s a very bad sign: a small-scale owner that wants
out and a large chain that says “nah, we’re good.” The energy in the newspaper
business for the past half-decade-plus has all been toward consolidation: roll all
these individual papers and small chains into one giant GannettHouse
DFMTribClatchyCorp and let corporate efficiency buy everybody a little more
time. But in at least in this one case, the consolidators have decided that
financially there’s nothing of value left to consolidate. The tricks they’ve been
using—cut staff, outsource editing, outsource production, regionalize ad sales—
apparently weren’t worth trying in Youngstown. And that’s scary as hell.

Within a month, candidates emerged to take over the job of covering Youngstown,
or at least some part of it. The Business Journal in Youngstown, which initially prom-
ised to help fill the void, announced it would be the latest partner for ProPublica’s
Local Reporting Network.
26 Newspaper Research Journal 41(1)

The Ogden Publications-owned Tribune Chronicle in nearby Warren pledged to

launch a zoned edition in Youngstown and eventually purchased the subscriber list,
vindy.com address, and Vindicator nameplate for its first edition on September 1.
Meanwhile, The Compass Experiment, founded by McClatchy with Google money,
announced it would make Youngstown one of its three startup newsrooms (Forman,
2019). Following several community meetings, Publisher Mandy Jenkins said she rel-
ished “the opportunity to do something a little different and hear from readers at the
beginning of a publication’s history.” Mahoning Matters launched its digital-only site
in October 2019 with a staff of five—including two reporters and an editor who was
formerly The Vindicator’s managing editor—and a range of stories from local fund-
raisers to courts to a data-driven piece on options to prevent local flooding.

Cutting Print Days

News item: Publishers are considering dropping straight from 7-day publication to
just 1 or 2 days, rather than simply dropping Saturdays or Mondays, analyst Ken
Doctor reported in Nieman Lab in August 2019 (Doctor, 2019). That same month, the
American Press Institute produced a 10,000-word primer on what publishers and edi-
tors should consider when cutting print (Ho, 2019). Examples: Do it deliberately as
part of a strategy, not just to save money. Consider which days based on revenue and
reader interest. Communicate early and often, brace for pushback from readers and
internally, but explain it’s what’s best for your future.
Perhaps, the most successful part of the idea is changing the internal culture, break-
ing the cycle of producing for the next day’s print edition, and getting free of the
relentless needs of paper production. Then-managing editor Thom Fladung of
Advance’s Plain Dealer in Cleveland called it “skating where the puck is going.”
While breaking the print cycle ostensibly frees journalists to do better work online, it’s
not clear the audience is getting the benefit that came from polishing and tweaking
until everything fit. And there’s no getting around that it’s telling 7-day readers of
whatever age they can’t keep their daily routine of comics, editorials, advice columns,
or whatever else had kept them loyal.

Missed Opportunities?
It’s not as if these questions are new. Consider this question for newsroom
leaders:

Why do some newspapers alertly change news and business strategies to meet
marketplace changes, while others do not? When confronted by changing reader
lifestyles, why do some editors succeed in moving quickly to meet readers on
new lifestyle ground while others continue putting out old-fashioned newspapers
for audiences long gone?

Conrad Fink (1988), the legendary University of Georgia scholar, wrote that 32 years
ago, in his book Strategic Newspaper Management. The only giveaway that this
wasn’t written in the past 10 years is we now avoid using “newspaper” as a generic for
companies largely focused on digital products.
Article 27

In the mid-1990s, Cox newspapers, such as The Palm Beach Post, experimented
with selling its content on the then-relevant Prodigy online service (Carlson, 2003).
Everybody was trying tie-ups like that, with antecedents dating back much longer—
notably The Columbus Dispatch on its hometown CompuServe in 1980 (Feran, 2017).
Knight Ridder’s experiment with Viewtron (1983–1986) could have had newspapers
monetizing their content online much sooner, saving some of those jobs. In each case,
the money ran out before the revenues caught up.
It’s fashionable and perhaps cathartic to say the owners blew it, but it’s also true
that the crowd has always wanted free. It’s evident in how quickly the classified adver-
tising revenue evaporated once Craigslist arrived to a town. Broadcasters have been
giving away content for free for 100 years and rarely turn readers away by demanding
a subscription first. Unless the audience can count on consistently unique content,
most will settle for a basic, even lesser, version of the story. Maybe it would have gone
differently if easy micropayments had arrived years earlier, before the audience
became conditioned to avoiding sites with paywalls. Frictionless purchases of news
could have justified newspaper company investments in further digital innovation, or
at least kept the wolf from the door while they figured it out.

Conclusion
The past decade of revenues may be evidence that local newspapers can continue to
generate enough cash, publishing on paper at least some of the time, and generating
proceeds—unimpressive ones, perhaps, but sustainable enough—long into the future.
That’s perhaps the most charitable critic’s reading of Edge’s proposal. Perhaps, they’ll
stabilize as a non-profit enterprise, with a combination of donations and foundations
contributing to a solution that generates enough resources to create something sustain-
able. It also could be that the pessimists were right, and that 10 years hence we’ll see
ink-on-paper as a quaint reminder of the past, like pay phones, and those profits of the
late 20-teens as the temporary proceeds of when hedge funds managed them. For now,
communities are likely to continue getting what they’ve been getting—a shrinking
product, produced by fewer journalists, less often on print, until the next round of cuts.
28 Newspaper Research Journal 41(1)

Before Answering Why

Newspapers Are Still
Here, Let’s Agree on the
Facts and History
By Dane S. Claussen
When we ask the question, why are newspapers still here? I think the starting point
is to get our facts straight about the newspaper industry, to consider those facts in the
proper contexts, to use the same definitions for the same terms, and to try to agree on
what the key questions and problems are without getting distracted by others.
So first, I think we have to amend the overarching question to: why are U.S. news-
papers still here? National situations around the world are different. In India, the news-
paper industry seems to be booming due to increases in the middle class, increases in
literacy, and perhaps more availability of capital to do something like start a newspa-
per. Newspapers in many European countries also seem to be holding their own, co-
existing with the internet in societies in which vast legions of people have acted to not
throw out the baby (newspapers) with the bathwater (older technologies being supple-
mented or replaced by newer ones). So, perhaps, the U.S. newspaper industry’s prob-
lems are more due to American culture and/or American journalism rather that the
medium itself. (And I am struck by how many Americans still will tell you that they
prefer print [such as college students preferring printed textbooks over online ones], or
even love print [the way that I vastly prefer reading a slick/glossy full-color magazine
with great photos and even ads on paper rather than on a screen].)
The second issue is that I venture most Americans are quite mixed up about the
overall state of the U.S. newspaper industry because of how much misinformation
there is about it, in large part, because the news media do such a bad job of covering
themselves. In May, 2019, for instance, The Wall Street Journal published, “In News
Industry, a Stark Divide Between Haves and Have-Nots,” a group of graphs and charts
about the newspaper industry. The presentation did not even differentiate between
which numbers referred only to U.S. daily newspapers and which referred to the entire
U.S. newspaper industry, although this would be quite obvious to anyone who knows
much of anything about the industry. Two thousand newspapers have shut down? That
would be newspapers of all types, since the United States hasn’t even had 2,000 daily
newspapers since before World War II. Drops in newsroom employment? Drops in
total paid circulation? Drops in total paid advertising? Those are all daily newspaper

Claussen is the editor of Newspaper Research Journal.

Claussen is the corresponding author: danenrjeditor@gmail.com
Article 29

numbers only, since no one compiles those numbers for U.S. weekly and other non-
daily newspapers. As for formerly daily (6–7) newspapers that are printed on paper 4
days a week or less now, who is counting those still as dailies (many post news 24/7)
and who is counting those as nondailies? Counting them as nondailies would exagger-
ate the decrease in daily newspapers although they still behave as dailies between their
print and online products. The Wall Street Journal is not the only offender. Also in
May, Columbia Journalism Review (CJR) posted the story, “Times-Picayune sale and
Wall Street Journal story highlight the grim state of local news,” without labeling
which facts referred to all U.S. newspapers and which only to dailies. When I pointed
this out to CJR, a staffer told me, “We do try to include these figures in a number of
our stories, but unfortunately we have to weigh the inclusion of them in each story
individually, and we don’t always note these exact things.” In other words, CJR does
not think that differentiating between the entire newspaper industry, daily newspapers,
and nondaily newspapers sometimes is worth the bother!
Plenty of other inexact and misleading “information” about the newspaper industry
is around. The Pew Research Center and others typically ask news consumers whether
they get their news from TV, radio, newspapers, or online, without drilling down on
whether their online news was reported and written by newspaper newsrooms and
whether consumers know their news is coming from newspaper newsrooms. That’s
confusing who is producing the news with how it is being delivered. Every day I read
the New York Times on my laptop and highlights of the Washington Post and The
Guardian on my cellphone, but if you ask me where I get my news from, I’d say
“newspapers” and not “online.” Most Americans (most people?) would say I’m get-
ting my news simply “online.” Such misleading research indicates to advertisers, other
news consumers, politicians, and others that the overwhelming majority of people are
getting news produced by something other than legacy media companies, as if Google,
Facebook, Twitter, Instagram, and so on suddenly have huge newsrooms covering
news nationwide and around the world and/or as if micronews organizations such as
Patch.com are everywhere and excellent (they’re not and they’re not).
I suggest that news media doing a terrible job of covering themselves is a substan-
tial part of what Iris Chyi calls newspapers committing suicide. But what if newspa-
pers finally stopped committing slow suicide and stopped claiming that their only
problem is being murdered by the internet? (I have long argued that U.S. newspapers
have been committing suicide for more than 50 years, since they were decades late in
adopting high-quality and widely used full-color printing, rarely used higher quality
paper, did not raise subscription and single-copy prices with inflation, generally did
not act on their own readership research, did not professionalize their advertising sales
staffs, rarely hired trained specialists to cover complicated beats, and were very late in
adopting automatic subscription renewals by credit card, among other failures. But
newspapers don’t need to keep trying to kill themselves indefinitely.) The professori-
ate has played a role in widespread misconceptions about the newspaper industry.
Reporting and editing textbooks are filled with nothing but examples from 50 largest
daily newspapers in a country that not too long ago had 1,500 daily newspapers and
still has about 1,250. Research is conducted frequently in which newspapers are
divided into groups such as large (100,000+ circ.), medium (50,000+ circ.), and
small (below 50,000), although the median average U.S. daily newspaper now has a
circulation of less than 10,000 and the number was likely never above 13,000. When
30 Newspaper Research Journal 41(1)

I’ve told journalists, journalism professors, and others over my career that well-known
metro dailies never accounted for more than 5% to 6% of all U.S. dailies, I’ve gener-
ally gotten blank stares, as if they can’t imagine there are any newspapers smaller than,
say, The Toledo Blade or The Des Moines Register. The fact is that the overwhelming
majority of all U.S. daily newspapers are small and always were small; understanding
this fact is critical to understanding the industry’s present and future. I will return to
this point below.
The entire topic of newspapers folding has been mostly talked about the United
States with misinformation. The most common misconception, still floating around
out there, is that the internet immediately started killing newspapers back when the
internet started growing exponentially in 1995. Marc Edge has recounted some of the
predictions, which started from the beginning. But the internet immediately starting to
kill newspapers was not true in two senses. The first was that plenty of U.S. daily
newspapers were folding before the internet; in fact, more dailies shutdown in the 16
years before the internet boomed (January 1, 1979, to December 31, 1994) than in the
16 years following the boom’s start (January 1, 1995, to December 31, 2010). This is
a simple and obvious observation that could long easily be made by looking at data
publicly available from the News Media Alliance (previously Newspaper Association
of America). The second is that analyses have shown that the internet’s impact on
newspapers did not seriously start until Craigslist—which decimated the highly profit-
able classified advertising—dramatically expanded starting in 2004; Craigslist was
still in only 32 cities at the end of 2003, but by September 2007, it was in 450 cities in
50 countries. The third is that studies also have shown that internet usage was not
responsible for less newspaper reading until about 2003.
The third issue is the question of which newspapers are shutting down and why.
Frankly, the entire history of the U.S. newspaper industry arguably has been volatile.
Daily, weekly, and other newspapers have been launched and shut down by the thou-
sands over a period going back to before the American Revolution. The daily newspa-
per industry was clearly overbuilt, with the peak number of different dailies occurring,
coincidentally, during World War I. It’s been only since World War II when it was
more obvious what was happening, as new dailies were created primarily by semi-
weekly and tri-weekly newspapers increasing publication to daily—very few started
from scratch, the last notable one being USA Today in 1982. Today, it is common for
those writing about the newspaper industry to mention that small newspapers are fold-
ing most often these days, but this requires some context. First, there are a lot more of
them, whether you are talking about more than 10,000 nondailies or the 95% of dailies
that are not “major metros.” Second, very few U.S. cities have more than one daily that
there are few secondary ones to succumb. Third, it has mattered a lot more who owned
a newspaper when it closed than its size. Much of Penelope Muse Abernathy’s (2016)
report, The Rise of a New Media Baron and the Emerging Threat of News Deserts, was
devoted to what she called “investment companies” owning newspapers and closing
down a lot of them. The point again is that when we talk about numbers, such as 2000
newspapers being closed down, we need to look at why they closed (which is almost
always related to who owned them). And, in fact, newspapers closed by “investment
companies” were a minority of all newspapers closing.
So what about the rest? Some commentators assume and would have you believe
that Facebook and Google are forcing the closure of untold numbers of weeklies and
small dailies. But if you look at “news desert” maps compiled by Abernathy and her
Article 31

colleagues, what is, or at least should be, quickly obvious is that one must allow for
each having its own story and not necessarily a horror story. For example, Abernathy’s
map shows no Kansas newspapers in Elk County, Scott County, and Rawlins County.
Yet, only Scott, with an estimated 4,961 persons, the vast majority of whom live in the
county’s only town, Scott City, could be expected to have at least a weekly newspaper.
Elk and Rawlins counties each have total populations of only about 2,500; Elk’s larg-
est town and county seat, Howard, has only 600 people. A better candidate for sadness
and outage (but also action) would be one of the two Pennsylvania counties with no
newspaper: Union County, population about 45,000 (which has barely budged for
about 10 years and previously was growing) and home to Bucknell University.
In places like Kansas’s Elk and Rawlins counties, the populations and economies
have been declining for decades, a news desert is no surprise, and there is precious little
that anyone can do about it. (The overwhelming majority of news deserts will not be
fixed by a nonprofit newsroom, Patch.com, volunteering journalism students from the
nearest college, or anything else.) President Trump overwhelmingly won these tiny
and/or dying counties all over the country, and some of his campaign rhetoric promised
revived farms and rural life generally, factories, and coal mines. But did anyone besides
me and demographers notice (with statistics, not only anecdotes) that hundreds of U.S.
rural counties have been declining for 50 years and some of them have been declining
more or less steadily for 125 years? A garden spot for a newspaper they are not.
Just days before the panel discussion at the 2019 Association for Education in
Journalism and Mass Communication (AEJMC) convention in Toronto, the New York
Times published an entire special section called, “A Paradox at the Heart of the
Newspaper Crisis.” The supposed paradox is that hedge funds (Abernathy’s “invest-
ment companies”) have rushed to buy newspapers although they are supposedly a
dying industry, so that hedge funds can squeeze whatever money they can out of news-
papers before, supposedly, all newspapers shut down for good. I’m not sure I would
call this a “paradox” and it’s not news: Philip Meyer wrote a long time ago about
newspapers being “harvested” for their cash flow and assets—he was describing just
the greediest newspaper chains, not hedge funds. In any case, the Times’ special sec-
tion, trying to be helpful, also included four shorter stories. One was about Report for
America, one was about education news producer Chalkbeat, one was about Detroit’s
Outlier Media, and one was about local news operations doubling down on what they
do best or uniquely, fund-raising if they need to. I think this package of stories tries to
leave the impression that various new efforts will make up for legacy newspapers
shrinking or folding, but again such an assertion requires a lot more context and details
than the Times provided.
What the New York Times and hardly anyone else is paying attention to are newspapers—
daily, weekly, and other—that are still locally owned, still doing the best journalism
they can every day, and not throwing too much money (and, in many cases, any more
money than necessary) at their online products. They know that their local news con-
tent literally cannot be obtained anywhere else, and they know their online output is
not likely to bring in much revenue at all while potentially costing a lot to do. They did
not need Iris Chyi’s studies to know that sticking primarily to print may mean a long
terminal illness while throwing a lot of money at online is quick suicide. The newspa-
per industry, believe it or not, also knows this: in late 2018, I heard Kevin Slimp, the
newspaper guru at the University of Tennessee, tell the Radically Rural conference in
Keene, NH, that newspaper chain executives have privately told him that they do not
expect their online products to ever be profitable. (True so far with few exceptions.)
32 Newspaper Research Journal 41(1)

In 2019, both Warren Buffett and Dean Baquet made public remarks about how
most U.S. newspapers (I’m assuming they meant dailies) will be closing down in the
near future. I wondered if Buffett and/or Baquet, both of whom I respect, know some-
thing I don’t. Surely they do! But, then, no, I don’t think so, even after Buffett decided
in early 2020 to sell all of Berkshire Hathaway’s newspapers to his long-time partner,
the profits-driven Lee Enterprises. I asked David Chavern, President and CEO of the
News Media Alliance, to respond to Buffett and Baquet. Chavern told me,

I think comments from smart, knowledgeable people in the industry are always
worth listening to and understanding. But the media space is moving so fast that
I think we should be careful about expecting anyone to be able to predict the
future. Present trends never continue forever. The public wants and needs great
journalism and the industry will find its way to a sustainable future.

Of course Chavern would say such a thing, you might say. But I also think, not just
hope, that he’s correct.

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