By Paul Gillin | February 25, 2009 - 7:18 am - Posted in Business News, Layoffs, NewMedia

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.

San Francisco Chronicle 2-25-09The 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.

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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.

6 Comments

  1. February 25, 2009 @ 8:02 pm



    So if newspapers had actually adjusted to the age of the Internet 15-20 years ago – as any serious business would have done when threatened by new technology or competition – they would be thriving as of today? ? I highly doubt it. Newspapers alone cannot compete with the Web. The news is out there for all to see and report. It is no one’s exclusive domain. All newspapers need in the 21st Century are intelligent, opionated columnists. I can get “the news” from any one of 100 sites or more so I don’t need to clog up the environment with a ton of newspapers that most people don’t recycle out of laziness or indifference.

    Posted by RCA
  2. February 26, 2009 @ 1:47 pm



    Paul:

    Did you see this story in yesterday’s Boston Business Journal that Hearst plans to buy local and lifestyle stories from Helium’s “citizen journalists,” starting with a test roll out in two Connecticut papers. I know there are some ex-staff reporters who write for Helium. But when they’re only paying $36 to $160 per article – the prices for articles currently posted on the site’s freelance writing marketplace – how could you trust that you’re getting a good story, either as a newspaper editor or as a reader?

    Here’s a link to the story:

    Hearst to use citizen journalists
    http://tiny.cc/ZyiHN

    Michelle Rafter
    WordCount: Freelancing in the Digital Age

    Posted by Michelle Rafter
  3. February 27, 2009 @ 5:30 pm



    [...] far too late. Hearst’s Seattle P-I is up for sale, and the San Francisco Chronicle is on the “endangered list.” Their preparation may extend their life a little as a company, but many of their media assets [...]

  4. March 1, 2009 @ 4:28 pm



    “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.”

    I wonder when your “travels” last took you to San Francisco. I wonder when you last read the paper.

    One can debate what constitutes “weak” writing and “tired” design, but green paper? The sports section hasn’t been printed on green paper since 1987. That is, until a month ago, when the paper’s latest redesign, and there
    have been more than a few since 1987, brought back the wildly popular green paper to the
    sports section on Sundays.

    Overall, your once-over-lightly analysis doesn’t shed a bit of light on the challenges that newspapers face.

    Posted by peter james
  5. March 1, 2009 @ 10:12 pm



    Maybe it’s been longer than I remember since the “wildly popular” green paper was used. I think I stopped reading the Chron during my frequent Bay Area trips about 10 years ago because it was so embarrassingly bad. If it’s gotten better since then, I’ve probably missed it. Legacy impressions tend to last a while.

    Posted by paulgillin
  6. March 19, 2009 @ 2:03 pm



    Een suday papers are losing readers i mean the liberal junk like THE BOONDOCKS,DOONSBURY and GET FUZZY are turning off readers i havnt read a sunday paper in years

    Posted by Flu-Bird