Most Troubling Media Trend of 2005
Number One: The Ongoing Shrinkage of the Newspaper Industry
Newspaper companies shed more than 2,000 jobs in 2005, one of the worst years in memory for the industry. Even executives who once tried casting job cuts as fat trimmming couldn't avoid the certain knowledge that these reductions hampered newsgathering capabilities.
The Chicago Tribune closed its City News Service local news operation. The Boston Globe eliminated its national desk. The Los Angeles Times is losing longtime music critic Robert Hilburn among a boatload of staffers taking a buyout to help avoid layoffs.
For a longtime newspaper employee, of course this feels like the end of the world. But the slow decline of newspapers also affects every other facet of the news business. TV news outlets and radio companies have already downsized themselves into skeleton staffs, while Internet news outlets built their business plan around lean labor costs.
Newspapers remain the last place where large numbers of journalists go out to unearth facts which the general public may not know, and what others may not want them to know (if you doubt this, watch CNN or Fox News and count how many times they cite stories based on newspapers such as the New York Times or Washington Post).
As circulation declines by a couple percentage points each year, and Wall Street demands increasing, double digit profit margins, newspaper companies around the country are struggling to make their business plans match the poor numbers. Sure, the industry is retrenching, but it may also be stuck in a death spiral -- cutting costs, which diminishes the product, which brings less customers, which inspires more cost-cutting.
I'm with those who have concluded that publicly-owned newspapers must either come up with a new definition of success for Wall Street, or they will need to get out of the newspaper-owning game. More and more, running a good newspaper is becoming a community service as much as a business. And its time to save America's newspapers before we're stuck in a news universe of breaking news coverage and infotainment.