To no one’s great surprise, the San Francisco Chronicle has joined the endangered species list. The paper has been hemorrhaging money almost since the day Hearst Corp. bought it in 2000, culminating in an astonishing $50 million loss last year. Yesterday, Hearst used blunt language in announcing that a “significant reduction in the number of unionized and non-union employees” was needed to keep the paper viable. If expenses can’t be brought into line, Hearst said it will put the paper up for sale and close it if necessary. The company is in the middle of a 100-days campaign to right itself, an initiative that includes putting the Seattle Post-Intelligencer up for sale.
The Chron is northern California’s largest newspaper, with a paid weekday circulation of 339,430, but it also sits in one of the most new-media-savvy places in the world. The Bay Area tech crowd is accustomed to getting news on BlackBerries and iPhones, Craigslist is a local institution and Google is revolutionizing the advertising business just down the peninsula. As the severely weakened San Jose Mercury-News can attest, Silicon Valley is a tough place to be a conventional media company. And there’s no Herb Caen any more.
Alan Mutter, who used to work at the Chron, runs the numbers. He estimates the paper will have to cut nearly half of its 1,500 employees to reach break-even levels. He also speculates on the possibility that MediaNews Group, which owns a portfolio of smaller newspapers across the state, could ride to the rescue. Hearst and MediaNews have been cozy since Hearst helped the company fund a deal to buy the Merc and the Contra Costa Times. If you want to understand this story, read Mutter.
A lot of people have seen this coming. Mutter has been predicting disaster for the Chron for years. BusinessWeek‘s Jon Fine picked the Chronicle as a likely candidate to exit print more than 18 months ago. The paper has reportedly shed half its editorial staff since 2000 and is looking at cutting half of what’s left. In our travels, we’ve observed that the Chron was long an anachronism for its sophisticated audience: a tired-looking, weakly written broadsheet that actually published some sections on green paper until a few years ago.
The Chronicle joins a long line of endangered US dailies, including the Post-Intelligencer, Rocky Mountain News, Minneapolis Star Tribune, Miami Herald, Tucson Citizen and Newark Star-Ledger. All have been put up for sale or pulled back from the bring in recent months. Given the drumbeat of bad news about the economy, it’s likely that the endangered species list will get longer as the year drags on. (hat tip: Richard Dooling)
Over on the other side of the country, the Providence (R.I.) Journal is reportedly getting ready to lay off 100 people as part of a bigger cost-cutting initiative by parent A.H. Belo. The ProJo reported a total staff size of about 700 last October, when it laid off 25 people. That was down nearly 40% from its peak. This new round of cuts will raise that number to about 50%.
Wrapping up the bad news parade, the publisher of the Cedar Rapids Gazette said it will cut 100 jobs. The publisher blamed a combination of the region’s devastating 2008 floods and the souring economy for the layoffs, which amount to about 16% of total staff.
This entry was posted on Wednesday, February 25th, 2009 at 7:18 am and is filed under Business News, Layoffs, NewMedia. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.