Five Big Newspaper Predictions

The newspaper landscape has never looked bleaker, at least in my years of experience. One company has declared bankruptcy (Tribune), and at least one other may may follow suit in 2009. Advertising revenue is in a tailspin, declining much faster than anybody anticipated. This year may prove to be even worse than 2008, and last year was pretty bad.

Many economic forecasts are very pessimistic about 2009, and I happen to agree with them. There's not a whole lot of light in this tunnel, especially with consumer spending way down. This downturn is going to force a lot of publishers' hands to produce more cost-saving cuts, bolder ideas or otherwise engage in desperate Darwinism.

Here are my Five Big Newspaper Predictions for 2009:


1. More layoffs
With ad revenue in a severe downward spiral, newspapers will need to significantly reduce costs and that means staff. I predict it will be brutal. Newspapers have no choice: labor and newsprint costs are the two largest newspaper expenses. Newsprint prices are going down, in part because demand has fallen. Many newspapers have already reduced page widths, number of sections, etc., which means they are buying less paper. They have also reduced staff. But I predict more staff will have to go in order to align revenue with expenses.

2. More newspaper sales
Look for media companies to unload some newspapers at bargain-basement prices. Maybe the Miami Herald is one; the Boston Globe is another. I predict that newspaper companies would rather sell for pennies on the dollar than continue to carry a newspaper that is a financial drag on their profit and loss statements and balance sheets.

3. At least another bankruptcy
Tribune's bankruptcy last year was no surprise to many who have been watching the company struggle. But Tribune by no means will be the only one. Lee Enterprises, publishers of the St. Louis Post Dispatch, is looking more and more like a candidate for bankruptcy. Last week, its auditor warned of the company's ability to remain a going concern due to its inability to pay down debt. Do the math. If you have to tap a credit line to pay off loans, it means you have little or no cash flow. Tribune did this last year, and look what happened. Lee has about $4 million in cash and $1 billion in debt. The company is also in the net loss column, and its stock has plummeted about 95 percent.

3. More newspapers will halt home delivery
Newspapers will cut back on home delivery on certain days of the week to shave costs. Home delivery is part of a newspaper model that flourished with increasing suburbanization in the 1940s and beyond. It helped boost circulation by allowing newspapers to follow the population migration to the 'burbs. (This, by the way, is how the neglect in coverage of urban population groups accelerated.) Plus, more workers began driving to work instead of commuting, making home delivery a viable alternative. However, as a financial model, home delivery never made much sense. Single copy sales are a much less expensive and efficient way to sell newspapers.

4. More newspapers will cease publishing 7 days a week
Not everybody can get away with this, but some newspapers can or may have to in order to remain viable. The Wall Street Journal only publishes 6 days a week (up from 5). The Christian Science Monitor is available only on the Web now. Certain days of the week are loss leaders for newspapers, including Saturdays and Mondays. Readership is low on those days. (As a reporter, I always protested having my stories published on those days.) The next best alternative is a very thin newspaper on loss-leader days, kind of like a digest of what's coming up the rest of the week. Or a combination of a digest and no home delivery.

5. More graphic-heavy design
Some wags may call this the triumph of design over content, and they would be right. At certain newspapers, design folks have catapulted in stature. It's already happened in Baltimore, where graphics guru Monty Cook took over as editor of the Baltimore Sun. Can Bonita Burton be far behind at the Orlando Sentinel? She's already been elevated to deputy managing editor for presentation. Both the Sun and the Sentinel are Tribune papers. More appealing graphics do not necessarily boost circulation, but graphics do make newspapers appear more in step with the Web, and that is increasingly important. Essentially, this means the traditional newspaper reader -- who is over age 50, educated and has a deep newspaper habit (in fact, they are keeping newspapers afloat) -- will continue to get shafted.