Why more newspaper cuts may lie ahead

For all the cost cutting that has traumatized the newspaper industry this year, profitability is falling far faster than sales, suggesting that deeper cuts may be necessary if the industry is to sustain its traditional operating margins.In the first part of the year, revenues have fallen by 9.4% in the newspaper divisions at half a dozen major publicly held companies, according to an analysis of

Correction: Billions, schmillions

“A billion here, a billion there and pretty soon you are talking real money,” goes a famous quote attributed to Sen. Everett McKinley Dirksen, the late, gravel-voiced Republican leader from Illinois.The quote, which actually may not have been uttered by the great man, came to mind this morning when several sharp-eyed readers noted that I incorrectly stated here the price paid for the Minneapolis

Perilously funded papers hit the wall

The most precariously financed newspaper deals apparently are starting to hit the wall, wiping out equity investors and causing at least some lenders to try to sell their loans at distressed prices.The lenders who provided the bonds for the $530 million purchase of the Minneapolis Star Tribune in 2006 have hired an investment bank to try to sell the loans at heavy discounts to either local

Why publicize newspaper job cuts?

A hundred chairs plastered with pink slips were set up in front of the Baltimore Sun today as the centerpiece of a protest against the latest staff cuts at the paper. It was a clever bit of street theater. But was it a good idea?I am as angry as anyone about what is happening at the Tribune Co. (and elsewhere) and I am as sympathetic as can be toward the people who are losing their jobs. But I

‘Private’ time for GCI, LEE, MNI and NYT?

The shares of Gannett, Lee Enterprises, McClatchy and New York Times Co. have fallen so low that the companies have become candidates for transactions that could convert them to private ownership.The companies could do it themselves, do it in partnership with private-equity funds — or potentially face unwanted takeovers from investors attracted by the bargain prices of their stock.A public

Just $3.6B: Total value of 10 news stocks

In a historic rout, newspaper shares have lost nearly $4 billion in value in the first 10 trading days of July, an amount greater than the combined market capitalization of all but the three largest publicly held publishing companies.The $3.9 billion plunge in the value of newspaper stocks since the first of this month – a period marked by successive new lows in the prices of several issues – has

5 newspaper stocks hit new lows - again

The shares of five newspaper publishers plunged to new lows in early trading today, including the shares of GateHouse Media, which fell to $1 per share, threatening its ability to remain listed on the New York Stock Exchange.Tumbling to new lows alongside GHS were Gannett (GCI at $16.43 per share), McClatchy (MNI, $4.58), News Corp. (NWS, $13.95) and New York Times Co. (NYT, $12.61). The

Online ad rates slid 14% since January

The average online advertising rate dropped 14.2% in the first six months of the year, according to a new industry survey.Demonstrating that even interactive advertising is not immune to the deterioration of the economy, PubMatic, a company which helps publishers optimize their revenues, reports that the average rate for 1,000 ad impressions fell to 36 cents in June from 42 cents in

Shorts socked newspaper stocks

Investor bets against Lee Enterprises and McClatchy were more than twice as big last month as those against the shares of Fannie Mae, one of the mortgage giants whose perceived instability jolted the financial markets.The wagers placed against a stock, which are known as short sales, give new insight into the long-running selloff that drove seven newspaper stocks to record lows in a single day on

7 newspaper stocks hit record lows in 1 day

The shares of seven publicly held newspaper companies today plunged to the lowest point in modern history in perhaps the worst single trading day ever for the industry.McClatchy (MNI), Lee Enterprises (LEE), and GateHouse Media (GHS) hit all-time lows when their shares skidded respectively to $4.85, $3.11 and $1.55 in the opening hours of trading on the New York Stock Exchange.Also hitting new

Tribune gets a ‘payday loan’

Sparing few efforts to raise cash to service its daunting $12.6 billion in debt, the Tribune Co. has taken a highly unusual step for a media company: Borrowing against its future ad revenues.While it is commonplace and legitimate for companies in many industries to borrow against the value of invoices that customers have yet to pay, most media companies never needed to do this, because their

Cuts nip traditional news-staff ratio

Upcoming cuts at a pair of Tribunes show how publishers are nibbling away at the long-held standard for the minimum number of journalists deemed necessary to staff a newsroom.The unwritten but widely honored rule of thumb in the industry always has been that a newspaper should employ one journalist for every 1,000 in daily circulation.But plans announced today to lighten the Chicago Tribune

Newspaper malaise chills M&A

If this is a bad time to be the in the newspaper business, it is a worse time to be trying to sell a publishing company.News Corp. conceded the weakness of the M&A market for newspapers last week, when it abandoned its efforts to sell the Ottaway division that it acquired when it bought Dow Jones last year. Ottaway operates eight dailies and 15 weeklies in seven states from New York to

What ails sales? One ad vet's view

In this guest commentary, advertising sales veteran Janet DeGeorge says "change" is a "dirty word" at most newspapers. She is the president of Classified Executive Training & Consulting. By Janet DeGeorgeNewspaper advertising revenue is down because most advertising departments have not changed the way they do business in 50 years. Well, probably 100 years.They have not changed the confusing and

Deeper staff cuts likely at newspapers

Tens of thousands of additional jobs may have to be eliminated at newspapers because the staff reductions that have taken place to date have not kept pace with the accelerating erosion of advertising.Even though 48.7% of the 102,120 jobs eliminated in the newspaper industry since 1990 were lost in the last three years, publishers since 2006 have failed to reduce headcount as aggressively as they