Bad news about newspapers just keeps coming. Tribune Co., owner of the Chicago Tribune and Los Angeles Times, among other nameplates, has filed for bankruptcy, McClatchy is reportedly trying to sell its prestigious (19 Pulitzers) Miami Herald and Scripps Howard is virtually begging for a buyer of its 150-year-old Rocky Mountain News in Denver.
Penny stocks now include some major newspaper companies: Journal Register, whose holdings include 22 dailies, among them the New Haven Register, sells for 6/10 of 1 cent a share, down more than 99 percent from its price two years ago. GateHouse Media, which owns eight dailies and more than 500 community publications, sells for 8 cents a share, also down more than 99 percent from its price two years ago.
Companies with the most prestigious nameplates have also been sucked into the downward swirl. The New York Times Co.'s share price has fallen from the mid-$20s two years ago to the mid-$7s, and the Washington Post Co., from the $700s to the $400s.
The recession has accelerated these dismal trends, but the bigger and longer-term problem is the migration of print readers to the Internet. Newspapers have responded by developing websites, but in a ham-handed way. Basically, the sites are simply electronic versions of the print products, with a few webby bells and whistles. Newspapers are mostly clueless in building websites that are interactive, socially sticky communities.
Here's what a sampling of dailies in some of the biggest markets offer potential online audiences in the millions: Detroit Free Press, Atlanta Constitution, San Diego Union-Tribune. Is it any wonder that newspaper web traffic, overall, shows such weak growth, compared to non-newspaper news sites?
An important exception is the New York Times, whose website attracts 20 million unique visitors monthly -- 20 times its print circulation. But even the Times site doesn't really exploit the potential of its huge, demographically attractive audience. If it did so, I argue in this article on Online Journalism Review, it might generate millions of dollars that would offset the double-digit percentage losses in advertising in the Times print version.
The Times' 20 million unique visitors are a community waiting to be formed, but the Times has to create some social networking opportunities for that to happen. Other newspapers, big and small, could create their own communities. Look at the success of Facebook and other networking sites. They are filling a vacuum while newspapers stumble about trying to convert their print products to pixels.
Very bad news -- and there are few signs it'll get better.