Friday, January 16, 2009

Strib Declares Bankruptcy

It continues to look more grim by the day over on Portland Avenue. From the article:

The filing, which was made with the U.S. Bankruptcy Court in the southern district of New York, had been expected for months. It follows several missed payments to the paper's lenders, and it comes less than two years after a private equity group, New York-based Avista Capital Partners, bought the paper for $530 million.

In its filing, the newspaper listed assets of $493.2 million and liabilities of $661.1 million.

Those are some bad numbers and they come despite this, also from the article:

The Star Tribune, with Sunday circulation of 552,000, is the 10th-largest Sunday newspaper in the U.S. Its daily circulation of 334,000 makes it the 15th-largest daily based on circulation. The paper's website, StarTribune.com, averaged 76 million page views per month during the past six months, placing it among the top 10 newspaper websites in the nation.

We tend to bash the Strib a lot in the local conservative blogosphere, mostly for editorial folly and the ham-handed way the paper has inserted itself into just about every political debate over the years. And there are some people who will view this moment as an opportunity for schadenfreude. Not me -- it's a sad day. The problem is this: I don't see a way for newspapers to continue with their current business model. It's gone.

Meanwhile, at least one Stribber continues to have a standing job offer. Operators are standing by.

4 comments:

Night Writer said...

I'm the media contact person for my Business Unit and we announced layoffs on Tuesday afternoon. Shortly thereafter I got phone call.

"This is Cara Ownens and I'm a reporter for the StarTribune."

"Congratulations," I said, with warmth.

"Ha! At least this week," she replied.

"There seems to be something in the air," I said.

"Yeah," she replied, "which is also why I'm calling!"

I think you're right about the business model failing, especially in distributing "hard copy." Everyone's getting more and more accustomed to web-based or digital communications, and these don't leave your fingers dirty with ink. That's a lot of union jobs, equipment and capital tied up in print.

The Strib's best bet may be to sell the land underneath it (not the optimum market right now), eliminate the print-related part of the business and move into smaller, cheaper digs - perhaps in the 'burbs! You don't need a basement full of printing presses and loading docks handling huge spools of paper and barrels of ink if you go all-electronic.

The trick then is to justify to advertisers the value-proposition of sponsoring the on-line site; subscription revenue will be low, especially with people used to getting web access "free". Drive the traffic, however, and you'll likely attract advertisers, and with lower overhead they might be able to make a go of it and keep a meaningful number of reporters and editors to produce the content.

Mark Heuring said...

The trick then is to justify to advertisers the value-proposition of sponsoring the on-line site; subscription revenue will be low, especially with people used to getting web access "free". Drive the traffic, however, and you'll likely attract advertisers, and with lower overhead they might be able to make a go of it and keep a meaningful number of reporters and editors to produce the content.

That's the only way. And I think that means local content. To the Strib's credit, they started to figure that out a while ago, but the challenge is finding the right way to cover things with less bodies. Put it this way -- I don't envy them.

Anonymous said...

Mark,
the greatest loss I foresee as a result of the collapse of the daily newspaper is to local and regional coverage; two subjects that I know you hold near and dear. Between the other forms of media, sports is more than adequately covered, God knows OP-ED is more than covered on the NET, and we are absolutely saturated with national news on the NET, TV, radio and weekly magazine. (International sucks at all levels, with the exception of the internet, which lacks true borders). But I can only imagine the hit we will take when the already paltry coverage of state and local government becomes even more scarce. I truly fear for the quality of our democracy when state and local governments and pols can act with impunity, knowing they won't receive any real scrutiny. I just don't see local TV and radio providing the kind of oversight necessary. Maybe blogging will do more to pick up the slack, but at this time, I don't think the blogosphere has developed to that level.
BTW, the best local/regional coverage I have seen on the internet is done by the MOB. You guys may just be on the cutting edge of the new paradigm.

Rich

Mark Heuring said...

Thanks for the comments, Rich. I agree that the local coverage is absolutely crucial and if we lose that, it's going to be a problem.

We (the MOB) do a good job of paying attention to local issues, but there aren't many of us who have the time to do the sort of reporting that needs to happen. I chose the name Dilettante for this blog for a reason, because the literal meaning of the word is a spectator, a dabbler, someone who isn't necessarily serious about the endeavor. While I'm often deadly serious about the topics I write about, this is a hobby.

And that is why we still need the Star Tribune, just as you need the Tribune and Sun-Times in Chicago. The only way a representative republic can function properly is if there is an informed and active citizenry. The media, for all the grief they take, are absolutely essential. And seeing so many sources falling down is profoundly disturbing.