San Francisco Chronicle layoffs
Reader Alan Mutter wrote in email: "Your 3/23 prediction of layoffs came true and the situation is perhaps more serious than you realized. See: Staff Cuts Won't Cure SF Chronicle Woes." From the article:
Although the staff reductions will save an estimated $8 million a year in payroll, the amount will cover barely a third of the approximately $25 million that industry experts believe the Chronicle lost in just the first four months of 2007....
The escalating deficit at the Chronicle comes on top of the more than $330 million the paper has lost since Hearst Corp. bought it for $600 million in 2000....Thus, Hearst has invested more than $1 billion in an asset that would be on track to lose $75 million this year, if its current burn rate weren’t arrested.
The Chronicle’s losses result from the usual combination of weakening circulation, declining revenues, rising expenses and increased competition for the available advertising in the market from rival traditional and digital media.
While some people commented after my last post that the Chronicle is a lousy paper and deserves to go, it seems to me that while the weakest go first, their fate tell us something about industry dynamics, and that we are witnessing the demise of institutions that many of us have taken for granted our entire lives. It's a good reminder that progress is not merely additive.
It's also a good reminder to those of us in publishing businesses (which are most affected by the rise of new media on the internet) of the urgent need to reinvent ourselves, or as Esther Dyson says, "Always make new mistakes." (Emphasis mine.)
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Comments: 7
[05.21.07 09:51 AM]
Great post!
Do you really think newspapers are on the way to their demise? I can imagine a chunk of them going under... but there's always going to be those people who like to read their morning paper. I'm 22, immersed in the blogging world, and I still like to read mine.
Flexible displays could probably capture that last "morning paper" audience. I'd hope newspapers would align themselves with that technology.
[05.21.07 04:23 PM]
They could probably lay off all the reporters and Chronicle readers would hardly know the difference.
[05.21.07 10:18 PM]
Having read the Chronicle for many years now, it's gradually faded away. It was once an outstanding paper with great local, regional and state news. Now its filled with NYTimes and news service reprints, local shootings, baseball and not much else. I am saddened by the loss in quality content which in my opinion is what resulted in the financial losses and staff cuts.
[05.22.07 09:41 AM]
We read a national paper, NYT, and a very local paper. Perhaps there is less of a need for the big regional papers. They can't do as good a job as the big papers on the national and international news, and they can't be as local as a small local paper. Adding in blogs, there is only so much news one can read in a day.
[05.22.07 01:52 PM]
Tim hits the nail on the head with the hypothesis that the weak die first. I think many of the strong are in trouble, too. I read the Wall Street Journal, New York Times, and Washington Post; all three papers have declined markedly in editorial quality in the past three years, especially the Journal. Judging from Rupert Murdoch's offer for Dow Jones (the Journal's parent company), the only thing insulating these particular newspapers from marketplace realities is family ownership. Even the strongest newspapers are not all that far from staring the grim reaper of capitalism in the eye.
[07.18.07 12:12 PM]
I am of the age where I still like holding the paper and reading in-depth and stories in the various inserts of the Chronicle over breakfast or a cup of coffee. If I need to read the NYT or WSJ I can but I choose the local regional Chronicle - I don't live world wide and I get my addle news from Time and CNN and other Internet venues. I know there are at least 300 thousand folks who still like to read the Chronicle. So Herb Cain died a long time ago - we don't have him but we have other great reporters and writers who are coming up.
We will always have the doomsday folks who say the paper is on its way out or the Chronicle is a bad paper etc. I think they are in general negative thinkers or spoilers who want to be heard. Change is always going to happen - so be it.
Henry
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Aaron [05.21.07 08:29 AM]
I would watch the Mercury News as an indicator not the SF Chronicle. Hearst Corp payed way to much and the Chronicle has been on the brink of collapse for many years. Its hard to see how you can draw such conclusions when you account for the multitude of factors causing this papers difficulty.