It’s the fourth week after the end of the quarter and you know what that means: earnings time. Quit now if you have a weak stomach. Here’s something fun to read instead. Otherwise, onward:
- McClatchy profits fell 50% on a 15.6% decline in revenue. CEO Gary Pruitt highlighted gains in online advertising but said he doesn’t expect overall ad revenues to recover any time soon. The company expects to cut staff by 10% over the next year. Pruitt boasted that McClatchy realized two years ago that online advertising isn’t just an upsell to print advertising and that Web-only ads now make up 50% of the online business. We wonder why it took until 2006 for this stroke of brilliance to occur.
- The news was a little better at Lee Enterprises, which reported only a 10% drop in print revenue. More troubling, though, was that online revenue was off 9%. Although the decline in online business appears to be unique to Lee for the moment, other publishers have recently reported that online sales growth is slowing. Most forecasters still predict the overall online ad market to grow in the 20% to 25% range this year, so anything below that is lagging.
- Bringing up the rear, E.W. Scripps reported similar results: profits down 47.5% on a 13% revenue decline. The company set its broadcast and online division free three weeks ago so it wouldn’t be dragged down by the implosion of the newspaper business.
The continuing profit slide, along with a bleak outlook for the future, may force some big publishers to cut dividends, says The Wall Street Journal. This would be no trivial decision, since some of the biggest companies are owned by families that depend on the dividends for income. But publishers may have no choice. If there are no profits, there can be no dividends, and falling stock prices have made existing payouts an onerous burden.
The San Diego Union-Tribune is for sale. Owner Copley press is “exploring strategic options” and we know what that means. The Union-Tribune hit the wall before most other major metro dailies, announcing a big layoff in January on the heels of nearly a 20% drop in circulation. the paper is the only asset Copley has. However, it’s a very big newspaper, the 21st largest in the US by circulation. The parent company claims its products reach almost 60% of area residents each week. But we suppose big doesn’t count for much these days. There’s speculation that A.H. Belo may find the Union-Tribune attractive and pick it up for pennies on the dollar if it can combine operations with another San Diego-area property it owns.
Miscellany
Writing in Editor & Publisher, Steve Outing issues a call for newspapers to start integrating user-submitted content into their products. Inviting reader comments isn’t enough, he says. Online coverage should include relevant photos, advice, observations and comments from interested and interesting parties. And we’re not talking Wikipedia here; editors need to separate the good stuff from the junk, but they still have to publish the junk somewhere in order to get get people to participate (TG for the “more…” link). The reason more newsrooms don’t do this already is that they’re culturally biased against involving non-journalists in the journalistic process, Outing says. But get over it; if you don’t interact with your readers, you’ll just isolate yourself. E&P, by the way, doesn’t allow reader comments on its site.
Two views on Tribune Co. CEO Sam Zell: The maniacal Tell Zell blog is now hawking anti-Sam merchandise like the adorable, hate-spewing bear at left. You can even buy a 50-pack of “Zell Hell” bumper stickers for only $97 and you know the holidays aren’t that far away. However, Recovering Journalist Mark Potts plays spoilsport. He derides the constant Zell-bashing within Tribune Co. as childish and counter-productive, particularly since the owner is actually trying to innovate as fast as he can. We have to admit he’s right, although we might pick up one of the teddy bears, anyway.
In a folksy editorial laced with jabs at the Bush administration, the editor of the Reno News & Review announces that his paper is going to do its part to save the planet by putting the staff on a four-day, 10-hour work week. It’s also folding its Theatre section as a stand-alone, but that probably won’ t have much of a carbon footprint. We wonder if readers could care less about the staff’s work hours.
When all else fails, eat. To celebrate its 30th anniversary, The Cheesecake Factory chain of restaurants will sell every slice of cheesecake at the 1978 price of $1.50 on July 30. We know where you can find us that day.
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