More newspaper cuts... that cut deep
Earlier yesterday morning, the bleak news broke across social media in North Carolina’s Piedmont Triad, where I lived for many years and came of age professionally. After years of layoffs, the region’s two major daily newspapers cut a large section of their staffs. The result? Already understaffed newsrooms were left decimated in the wake.
Seven editorial staffers at the Winston-Salem Journal and five reporters and editors at the Greensboro News & Record – representing about a third of each newsroom – were given their pink slips in the middle of a pandemic. One by one, many of the newly fired staffers posted their sad news to Facebook or Twitter, and in what’s become a frequent COVID-era tradition, friends, supporters, and former colleagues offered condolences and rage.
(If you don’t know the significance of -30- in the news business, btw, click here.)
Gone from the Journal are features reporter Tim Clodfelter and arts reporter and entertainment editor Lynn Felder; photographer Allison Lee Isley, a graphic designer, and three members of the sports team, including Conor O’Neil and Patrick Ferlise. At the News & Record, Managing Editor Cindy Loman and sports writer Ed Hardin were among those terminated. As things stand now, there aren’t that many folks left at either paper.
Decades of experience walked out the door today. Entire segments of the Winston-Salem and Greensboro communities — most notably sports and the arts, will now receive a lot less attention and coverage… and likely because of that, support from customers and audiences. And those reporters, and that coverage, were some of the few remaining reasons that many people still subscribed to the papers after years of downsizing and profit-squeezing. And so, already anemic newspapers will be put under even greater pressure to squeeze what they can out of the brave souls who remain.
Lee Enterprises, the corporate owner of both papers, has been shedding staff for months through layoffs and furloughs in their newsrooms across the country. Already hit hard by the changing economics of local news, the pandemic has gutted advertising revenues and sped up the bloodletting at Lee, which owns and operates newspapers in 77 markets around the country, including the St. Louis Post Dispatch, the Buffalo News, and the Decatur Herald & Review (the paper my family subscribed to when I was a child).
But… It doesn’t have to be this way
Sadly, layoffs in the news business are hardly news any more, because they’ve become so commonplace. With the pandemic, the process has been accelerated dramatically. In early May, the New York times reported that roughly 36,000 workers at news companies in the U.S. have been laid off, furloughed or had their pay reduced.
At this point can anyone credibly make an argument that the local newspaper business ISN’T in a death spiral? After years of reducing their capacity and reason for existence, fewer people will want to subscribe to local papers… which will lead to higher subscription rates and even further cuts. Which leads to… well, you get it.
How exactly is this supposed to end well?
As a former newspaper reporter, someone who spent many happy evenings watching printing presses bring my work to life, I’m stung deeply by these developments. Our communities deserve better than this.
What’s clear to me now is that corporations have utterly failed us and are no longer the appropriate institutions to carry the torch of local news in this country. Their unrealistic profit expectations are destroying our newspapers, and with them the underpinnings of our democracy.
Please know, this isn’t some wishy-washy anti-corporate screed. I’m as capitalist and pro-profit as they come. But American corporations have become destructive beasts in our modern times, borrowing heavily to expand or buy time until they figure out how to overcome past mistakes and make money again. Since the pandemic started, we’ve seen this play out across almost every industry. For instance, J. Crew, 24 Hour Fitness, Briggs & Stratton, Brooks Brothers, Chesapeake Energy, Chuck E. Cheese, Hertz, and the newspaper company McClatchy are just a few of the major brands that have gone bankrupt in recent months.
And Lee Enterprises? Earlier this year, they spent $140 million to buy all the newspapers held by Warren Buffett’s company, Berkshire Hathaway. (After building up a robust and respected portfolio of papers across the country, Buffett famously declared that the newspaper business was “toast” due to declining ad revenues, before exiting the business entirely.)
At the time of the sale of Buffett’s papers to Lee, though, BH also provided $575 million in long-term financing at a 9 percent annual rate, becoming Lee’s only lender in the process. So, in effect, Buffet loaned all the money for the acquisition of his own company’s papers AND to provide a pile of capital to satisfy all of Lee’s needs related to operations, past mistakes, and any future acquisition adventures. All Lee had to do was make sure it made more than 9 percent profit from its newspapers for many many years to come, in order to afford its new debt load. Rough sledding during normal times in the news business. Impossible during a pandemic. And so cuts were “necessary.” (Scare quotes mine.)
So, what is the answer?
While I don’t have a crystal ball, I do have an opinion, so stand back and hear me out as I wrap up today’s post.
As I said, I believe it’s clear that corporations can no longer be trusted to manage our country’s local newspapers. In their place, we need stewards who will run news organizations with an eye not just on profits, but with respect for the needs of their local communities. In short, I believe communities need to step up and incubate new non-profit organizations to publish daily local news… like VTDigger, and San Diego’s inewsource. (Another interesting model are the journalist-owned publications, like the Colorado Sun.)
In addition to publishing daily news online, though, I think these new non-profit community news organizations can provide regular (although not necessarily daily) print editions to their customers, for those willing to pay a bit more. Unburdened from the debt loads and free to reimagine themselves to accommodate changing audience tastes, I think a lot of new innovations are possible. But to be successful, these new local news organizations need three things:
Start-up funding from within each community. For some this will be tens or hundreds of thousands. For others, millions. And now because of the pandemic, the bulk of this will have to come from within local communities, with very little expectations of outside support. Tough. But when you consider the alternative — diminished or completely eliminated local news — it’s decidedly better.
Diverse revenue streams. In addition to regular subscribers, and frequent major gifts, corporate sponsorships, and foundation grants, these new local news entities need to get creative. Personally, I think creating endowment funds that underwrite large chunks of a non-profit’s operation — such as fully-funding specific reporting beats, in this case — could be a good solution for sustainability. But this requires deep pockets and sophisticated fundraising efforts. (For instance, to fully fund a $50,000 annual reporting salary, you’d need a $1 million endowment which you draw 5 percent off annually.) Which is why you also need…
MAJOR local buy-in. Lastly, for this to work, community leaders need to decide that this is a project worth supporting. For instance, city, county, and state governments need to allow the legal notices that they require to be published in local media, to flow to these new journalistic entities, rather than being locked in corporate owned newspapers. Local marketing agencies and advertisers also need to embrace these new online (and maybe print) entities, and initially be ok reaching fewer eyeballs for the same money previously spent, while these news organizations grow to scale. And key local institutions, the ones that are lucky enough to survive and rebound from the pandemic, such as community foundations, arts organizations, universities, and sports teams, need to provide their facilities, fundraising expertise, connections, and — yes, even funding — to help these news organizations become successful. (Personally, I think big-hearted public television groups and public radio stations could also play a tremendous effort as incubators in this effort.)
And what about the local journalists still chugging away today in newsrooms across the country? As a former worker in those very salt mines, I wish each and every reporter, editor, photographer, ad sales rep, subscription manager, and graphic designer toiling away the very best of luck… and a strong stomach.
Because I also expect the next 10 to 15 years to bring the final collapse and bankruptcy of many many more newspapers across this country, run into the ground by their corporate overlords. (And only then should these new non-profit local news entities consider purchasing the remains — the brand name and news archives — of our country’s deceased local newspapers.)
Now, if you’ll excuse me, I’m going to sign off and re-watch "All the President’s Men” for the thousandth time, to get this bad taste out of my mouth.