By Jen Lynch
Studying communications and finance for four years here at Syracuse has enabled me to bring together two separate topics that have now converged- newspapers and bankruptcy. The Associated Press, one of the most respected newswires in the world, is even facing financial trouble- with subscribing newspapers unable to afford membership.
These papers are filing for bankruptcy, closing completely, or laying off tons of employees; they're just trying to hang on. The AP is a nonprofit formed by its member papers, and with recent losses of revenue and newspapers filing for bankruptcy, it is estimated that revenue from U.S. members will fall by a third from 2008 to 2010.
For example, just today two newspapers in Philadelphia were granted a hearing postponement to the decision of who will financially control them, after filing for Chapter 11 bankruptcy in February. The financial hearing will be debtor-in-possession, and currently the Philly newspapers argue that they're doing ok at the moment- although filed $395 million of debt.
The AP is clearly struggling at inventing new ways to try and keep the papers. "One new option the wire service is offering is a limited service for papers 'with minimal world and national coverage needs'," a recent Reuters article said. This would solve the problem of smaller papers still being able to get important news, but the revenue may not be enough to sustain the AP organization as a whole.
The AP is clearly struggling at inventing new ways to try and keep the papers. "One new option the wire service is offering is a limited service for papers 'with minimal world and national coverage needs'," a recent Reuters article said. This would solve the problem of smaller papers still being able to get important news, but the revenue may not be enough to sustain the AP organization as a whole.
In Chicago, both the Chicago Sun-Times and the Chicago Tribune have been forced into bankruptcy. This is due to a loss in advertising revenue as well as circulation- with the Internet, people are reading their news online. This causes a problem for newspaper revenues because digital ad space is much cheaper than print space. The Tribune declared Chapter 11 bankruptcy in December, and the Sun-Times filed just last week.
The Crain's article also reported Denver's second-largest paper, The Rocky Mountain News, closed this February, and the Seattle Post-Intelligencer closed its print edition in March, continuing to only maintain an online version. This also creates problems with the economy and job market, when a smaller-scale newspaper stops its print edition and works online, up to 80 percent of jobs could be lost.
The San Francisco Chronicle and Boston Globe are also seemingly close to the edge, forced to either sell very soon or join the current market with massive layoffs. According to the Newspaper Association of America, total newspaper revenue fell nearly 17% in 2008. More and more newspapers are stopping print editions, cutting jobs, and filing for bankruptcy. This situation is scary because newspapers have acted as government and city watchdogs, maintaining their importance as the Fourth Estate, revealing information to the public.
Philadelphia Inquirer ArticleThe Crain's article also reported Denver's second-largest paper, The Rocky Mountain News, closed this February, and the Seattle Post-Intelligencer closed its print edition in March, continuing to only maintain an online version. This also creates problems with the economy and job market, when a smaller-scale newspaper stops its print edition and works online, up to 80 percent of jobs could be lost.
The San Francisco Chronicle and Boston Globe are also seemingly close to the edge, forced to either sell very soon or join the current market with massive layoffs. According to the Newspaper Association of America, total newspaper revenue fell nearly 17% in 2008. More and more newspapers are stopping print editions, cutting jobs, and filing for bankruptcy. This situation is scary because newspapers have acted as government and city watchdogs, maintaining their importance as the Fourth Estate, revealing information to the public.
Crain's Chicago Business Article
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