It’s been a very interesting past few weeks with a bunch of stories relating to the death of older news and journalism models (daily newspapers) and the emerging models that hope to replace the dailies. Below are a few of the stories that have caught my attention…

• On the old model front, Gannett has cut 1,000 more people from its payroll, and McClatchy’s efforts to restructure its massive, crippling debt load failed miserably. An extremely insightful, detailed analysis of Gannett’s debt reveals just how rapidly that company’s balance sheet has deteriorated and how perilously close to insolvency the once stalwart publisher truly is.

• Also on the old media front, USA Today shuttered ‘Open Air,’ its quarterly magazine targeting more affluent readers, and Tribune also ceased publishing its weekly Sunday magazine.

• Even smaller dailies, who had seemed somewhat immune to the travails of their big-city brethren, are feeling the impact of the web as well as the current economic meltdown. Deal activity in that segment of the media landscape is rising, and valuations present some interesting opportunities.

• Despite the grim news, there are signs that things may have bottomed and that at the current prices, certain media companies present compelling investment opportunities. Even Sam Zell appears to have found a buyer for his Cubs and Wrigley and his cable business. While below initial estimates, the fact that it might get done at all in the current environment is amazing.

• Another positive sign for the dailies is the fact that some are beginning to see returns on their investments in emerging media and technology. Even despite some embarrassing missteps and the fact that many investments are still in their very early stages, there is hope that the flurry of activity over the past few years, while perhaps too late, might have a chance in salvaging some value for the large dailies.

• Even Google is helping the cause of publishers by helping pave the way for customized news delivery.

• On a much smaller scale, some monthly magazines like Men’s Health have even figured out how to capitalize on the iPhone phenomena to create a nice little recurring revenue stream.

• One thing certain to not work for any daily paper is charging for the vast majority of its daily news content. Some will try, and perhaps one or two (NYT & WSJ) might be able to succeed at some minimal level, but the pay for content model is a death sentence for anyone else.

• A bunch of stories have sprung up recently about emerging new models for online news and journalism such as Huffington Post and Politico seeking to fill the vacuum being created by the implosion of the dailies. Debates are raging as to whether Huffington Post, in particular, is a credible, high-quality source of journalism, news, and opinion or a trashy parasite, and the arguments on both sides are both enlightening, interesting, and entertaining.

The headline is not a critique of Warren Buffett in any way, I simply could not think of a word for newspapers that started with an ‘O’. In any event, Warren Buffett weighed in on the state of daily newspapers this past weekend at the Berkshire Hathaway annual meeting and articulated about as grim an assessment as one could imagine. (Berkshire Hathaway owns the Buffalo News and has a significant position in the Washington Post).

“For most newspapers in the United States, we would not buy them at any price,” Buffett said. “They have the possibility of nearly unending losses. … I do not see anything on the horizon that sees that erosion coming to an end.”

Of course, as any good short seller will tell you, the losses will most definitely end when a company stops operating.

It has to be the case that the New York Times is reading this blog. The story they ran yesterday on the front page was my #1 prediction for 2008. Either that or they’ve been reading Alan Mutter’s blog, or tweets from themediaisdying or any of the other countless blogs, articles, industry analysts, pundits, experts, or doomsayers that have been predicting the inevitability that a major metro market in the U.S. will lose its printed daily newspaper entirely in the very near future. So even though my analysis may not have been that original, it was a fun article to see on the front page of the New York Times 14 months after I wrote the same thing.

There has been a whole pile of additional news over the past week or two about the daily newspaper industry, along with a bunch of other interesting things I’ve seen and read, so it’s time once again to dump out my list of saved articles and links.

• Q4 ‘08 results for magazines and newspapers were even more horrifying than even the most pessimistics observers would have predicted.

• MinnPost’s David Brauer has a fix for the annoying way the Star Tribune paginates it’s online articles.

• The stars from the best video podcast, Kevin Rose and Alex Albrecht of Diggnation, made an appearance on Jimmy Fallon’s show. Podcasts have now officially become a mainstream media channel.

• Moody’s new ‘Bottom Run’ classification of the worst credit risk businesses is filled with radio and newspaper companies. What a shock!

• Philadelphia’s newspaper mogul, Brian Tierney, whose company just declared bankruptcy, erupts at the bloggers who are dancing on the graves of daily newspapers all over the country and declares, “We’re not dead yet!” Death might actually be more appealing than the rotting-corpse, zombie-like state that most dailies are in these days. And yet, maybe he’s right.

• 4 dailies in Tennessee are trying desperately to stave off oblivion by sharing resources and cutting costs. At the rate dailies are going, we might end up with one giant (or small) newspaper monopolist that tries to cover the entire country.

• The NYT article from yesterday made the oft-repeated claim that Craigslist stands as the primary culprit behind the demise of daily newspapers. What a joke. And shabby, lazy, simplistic reporting, too. Craigslist certainly took some market share and eroded some revenue, but the site is largely filled with classifieds that would never, ever run in the daily paper, despite what they claim.

• Unions, which have been a substantial factor in the bloated cost-structure of most dailies, are now stepping up as perhaps the last-ditch saviours??!?!?!?!?!

• The New York Times is trying to generate cash from every nook and cranny in the business. I hope they succeed. I could not stand losing the Times.

• Since 1990, only 5 of the 25 largest papers in the country have grown circulation.

• MediaNews Group is the first major newspaper company to finally realize that the answer might be a customized newspaper. It’s most likely too late, but it’s about time that someone from inside the industry finally come to appreciate one of the solutions that has been widely recognized and bantered about outside the industry for at least a decade.

• Denver lost a daily. Seattle and San Francisco will soon lose their dailies. And there’s a growing list of others that will have no daily by year-end.

• Even Rupert Murdoch is having a tough time these days.

• Jason Calacanis, who made news this week for his brazen yet brilliant offer to buy a spot on Twitter’s top 10 recommended list of twitterers to follow for $250,000 (which, by the way, Twitter should accept immediately so they can actually start generating revenue), has written the best piece yet on start-ups surviving in the current economic meltdown.

• The free v. paid content debate rages on.

• Is Patch one of the new models that will fill the void when the presses eventually stop running?

Lots of stuff, and sorry for the massive, somewhat lazy dump of links, but the overflow of stories and links is getting overwhelming, and I’m afraid that it’s actually just getting started. It’s going to be a crazy year.

On December 31st of 2007, I made 10 predictions for the coming year. The #1 prediction was that a major metro market in the U.S. would lose its daily newspaper in 2008. While some smaller newspapers have folded and other larger ones have been put up for sale without any serious takers, the prediction at this point has not yet proven accurate. And while only a few months remain, I remain positive in the possibility that the prognostication will ultimately prove prescient (nice alliteration, huh?). Apparently, the readers of HubDub agree with me.

HubDub poses various questions to its readers and attempts to predict the future by tapping into the collective wisdom of its audience. There is some pretty compelling evidence that a sufficiently large group of people can lend insight to future events, but that ability usually relates to events such as elections, where those same audience members have a direct impact on influencing those events (i.e., voting for their preferred candidate that they previously predicted would win). While HubDub’s audience can certainly have an impact on the future of the dailies by choosing not to read the daily newspaper or not visit newspaper web sites, that impact is indirect at best. Nevertheless, 65% of HubDub’s readers predict that a major metro daily with a circulation greater than 50,000 will fold before the end of the year. I’d call that a landslide.

The best commentator on the decline of the dailies, Alan Mutter – aka the Newsosaur, recently uncovered a very interesting McClatchy filing with the SEC and has written an excellent post about what it might mean. Essentially, McClatchy’s CEO has resigned from the family trusts that own a 41% stake in McClatchy, a step that would be required were the family to take the newspaper publishng company private. The company has denied that that was the intent of the resignation, but there is little doubt that as the market cap of McClatchy continues to plummet, the possibility of such a transaction becomes increasingly likely. The company’s stock has dropped 88% since it acquired Knight Ridder, and today is worth a measly $301 million. As Mutter says, if you are bullish on the long-term prospects for newspapers and believe in their future, the value play on MNI gets more attractive every day.

The visible decline of the dailies probably began 5 years ago with readers abandoning the daily newspapers for better, cheaper, more convenient alternatives. The slow decline in subscriptions turned into a pretty rapid decline and eventually forced advertisers to re-examine the deteriorating value proposition that newspapers offered. The decline in subscription revenue, combined with the accelerating decline in advertising revenue, forced newspapers to stop investing in their products which further eroded their value proposition and caused further declines in readership and advertising revenue. In the last few years, newspapers have been forced to start cutting costs to stem the bleeding and bring costs in line with a smaller, permanently impaired revenue base.

Cost-cutting started first with easy, non-core, non-essential things like eliminating stock tables, reducing paper width, outsourcing and off-shoring certain functions, and a range of other superfluous cuts. But eventually, the papers discovered that limiting cuts only to fat were not sufficient and so began the cutting into muscle. The employee buy-outs and layoffs began, first with behind-the-scenes positions but eventually migrating into bone – meaningful content areas such as the newsroom, the sports desk, business news, and arts and entertainment coverage.

That’s where we are today, with a vicious, negative, reinforcing, downward spiraling cycle that will persist indefinitely over the next decade or so until there are, essentially, no daily newspapers left. While there will undoubtedly be some survivors, there really isn’t any conceivable hope for recovery, especially when one considers the newest phase of the industry’s decline that is beginning to materialize – voluntary abandonment from within.

The most recent departure of Jay Mariotti from the Chicago Sun-Times caught my attention (Thanks Nick) and is indicative of what is certainly happening in daily newspapers around the country. Writers, journalists, editors, sales people, columnists, and anyone in the business with half a brain and any type of marketable skills are abandoning the sinking ship before they get sucked down with it. A few laggards may be holding out for the next buy-out offer from ownership, but the best people are most likely bailing sooner to grab whatever lifeboat of opportunity they can.

And can you imagine anyone in school today thinking that they want to begin a career in the daily newspaper business? Not that newspapers are actively recruiting on campus today anyway, but what an impossible job recruiters and HR professionals in the newspaper business must have trying to attract talent into the industry. It’s a grim picture that gets worse and worse with every new chapter.

Even NBC Nightly News has finally caught on to the certain death of the daily newspaper industry. Last night, Brian Williams and NBC Nightly News ran a story on the rapid decline of the dailies and the almost certain death towards which they are marching. The story focused on the Palm Beach papers and the recent staff cuts (300) as well as the Chicago Tribune and the announcements that the company is selling its landmark real estate holdings as well as Wrigley Field and the Cubs.

The story did present a counter argument in the form of Mort Zuckerman who has the luxury of publishing a tabloid paper in the nation’s largest metro market (so his rebuttal almost doesn’t count). So although it tried to present as balanced a perspective as it could, there is little doubt that the fact that it was being covered by NBC Nightly News means that the demise of the dailies has inched another step further down the spectrum of inevitability and mainstream coverage.

Back in May, McClatchy issued an SEC filing in which it had written down its 49% ownership stake in the Seattle Times from $102 million in 2006 to just $12 million, a drop of nearly 90%. McClatchy acquired the minority stake in its purchase of Knight Ridder and the Blethen family owns the remaining 51% stake. Seattle’s other major daily, the Seattle Post-Intelligencer, is owned by Hearst, and the two papers operate under a joint operating agreement (JOA), albeit with a lot of bad blood and squabbling. McClatchy has also announced that it is very interested in selling its stake in the Seattle Times, even at the current, ridiculously depressed price.

The situation in Seattle is not only indicative of what is happening to daily newspapers around the country, but it’s also particularly relevant to the Twin Cities, which by all accounts is too small a media market to support two daily newspapers, especially in the current environment. The bickering, lawsuits, and troubles surrounding the Hearst/McClatchy relationship in Seattle raises substantial questions about the likelihood of Avista and MediaNews ever reaching an agreement about establishing a JOA or even combining the two dailies in Minneapolis and St. Paul. I cannot imagine that discussions between the two companies are not taking place, but the longer they wait, the more likely it is that the already depressed valuations of both papers are going to be further annihilated. At a valuation of $25 million like the Seattle Times, it hardly becomes worth the effort to try to salvage anything from the business.

With the well-documented problems plaguing both Midwestern dailies, it’s a toss-up as to which metro market will lose its daily newspaper first, Minneapolis or Chicago. The Newsosaur Alan Mutter has another great post today on the vastly different approaches that Rupert Murdoch and Sam Zell have taken since both acquired their newspapers roughly 6 months ago, and the New York Times has also chimed in on the preposterous path that Sam Zell is taking in trying to save his business by slashing everything in sight. As Mutter rightly points out, what is even more shocking than Zell’s apparent lack of any cohesive plan he is following is the fact that his creditors loaned him more than $12 billion without asking about what he intended to do to fix a dteriorating business model. Everyone in this deal except the poor Tribune employees (who also happen to be owners) deserve exactly what they’re going to get in this deal – nothing but an obliterated business left in complete shambles after everything of value has been sold off piecemeal.

Portfolio remains the best business magazine on the market today, and stands as the best new magazine I’ve read in some time. In an article this month entitled ‘Paper Tigers,’ Roger Lowenstein details the efforts of Charles Madigan to compile previously published articles relating to the decline of daily newspapers. It’s a solid article and I will undoubtedly enjoy perusing Madigan’s collection of articles.

At any rate, Lowenstein included some statistics about the deterioration of the daily newspaper industry that are worth repeating. Circulation today, for all the dailies in the country, is equal to what it was in 1950 when the population of the country was half of what it is today. Among adults younger than 34, only 1 in 5 reads a paper every day. And lastly (though it is well publicized, it remains shocking nevertheless), the average age of a daily newspaper reader is 56. In general, the article provides a decent synopsis of the issue facing newspapers and adequately summarizes the larger questions about what might become of printed news, what role newspapers play in a democratic society, and how Wall Street, profitability, and charitable foundations have and may, in the future, impact newspapers. It is well worth the read for anyone interested in the industry.