After a few weeks of ‘Dailies Are Struggling’ articles piling up, I’ve decided to just provide a list of them with a brief summary. In going through the exercise of listing them, however, it becomes quite apparent that not only is the bad news coming at a faster pace and in regard to more companies, but the severity of the news is increasing as well.
No longer is the news limited to falling share prices, declining readership and circulation, plummeting ad revenue, employee layoffs, and cost cutting efforts. The news now includes balance sheets, debt covenants, cash flows, asset sales, etc. The illness spreading through the industry is long past the outer fatty layer. It has passed through the muscle and bone, and is now migrating into vital organs and it isn’t slowing down. The dailies are in critical condition and except for a few resilient papers, survival is just not a realistic scenario.
• Milwaukee Journal reports lower revenue (here)
• The Audit Bureau of Circulations adjusts the rules that allow any paying customer, no matter what the price and how deep the discount, to be included in the ‘Paid Circulation’ category (here)
• News from the Tribune Co. keeps getting uglier (just as we all knew it would) (here)
• Even Lee Enterprises, who was somewhat immune given their the markets they’re in, has struggled, especially with the Pulitzer acquisition (here)
• Diminishing cash flows are making debt payments that much more painful for highly leveraged papers (Tribune Co., Media News, and Journal Register, in particular). Debt covenants are also in serious jeopardy of being violated. (here)
• The Journal Register’s debt burden is so heavy it has hired Lazard to advise as they consider various restructuring options (i.e., bankruptcy) (here)
• The Washington Post, which is writing the book on how newspapers and media companies should be competing these days, doesn’t get everything right (here and here)
• The single best article yet on the demise of the dailies and the debate around the subsequent impact on the U.S. (here)
• Alternative media expected to grow 20% in 2008 (here)
• Yahoo tries to address fears of its newspaper consortium (here)
• Even with the dollar in the tank and average valuation down 50-85%, foreign buyers still think U.S. dailies are overpriced (here)
• Q1 earnings for the dailies are expected to uglier than ever (here)
With all the stories over the past few years, and the increasingly alarming tenor of the stories these days (as exemplified by the list above), It’s hard to imagine that there are still those who think that the doom and gloom surrounding the daily newspaper industry is overblown or even unfounded altogether. It’s grim, and the horizon is getting darker and darker.