Several news items last week got me thinking once again about the future of the Twin Cities’ leading newspapers.
First was the report that the New York Times Co. plans to sell the Boston Globe, a respected regional paper. The Globe shares many characteristics with the Star Tribune, and their paths forward may be similar.
There’s a great analysis of the Globe sale by Ken Doctor, one of the more insightful and engaging thinkers on the changing news industry. Doctor was managing editor of the Pioneer Press for more than a decade through the mid-‘’90s, an era when the St. Paul paper won Pulitzer Prizes. Now he’s in the Bay Area as a media analyst, consultant and columnist.
Doctor points out that the Globe’s newsroom is downsized but not hollowed out. That holds true for the Strib. The Globe has made progress in selling digital subscriptions, logging 28,000 to date. The Strib now has 27,000 digital subscribers, as its publisher Mike Klingensmith told an industry gathering last week. Those are among the positive signs.
The negatives? Continued declines in ad revenue that aren’t being matched by growth in circulation dollars.
Here’s where the Strib might have an advantage over its Eastern counterpart. The Star Tribune has been very successful in boosting circulation revenue, a critical goal for every newspaper. For the last century, ads paid the freight. A typical newspaper got 80 percent of its revenue from advertising. Now newspapers want readers to pay more out of their own pockets. In Minneapolis, that appears to be happening.
One reason is because people on both sides of the river remain devoted newspaper readers. Nationally, Minneapolis ranks No. 3 and St. Paul No. 6 in newspaper market penetration, according to the annual report on America’s most literate cities compiled by Central Connecticut State University.
In other words, the percentage of households that buy a newspaper in the Twin Cities is among the nation’s highest.
That’s the good news.
The bad news is that those newspaper readers are old. As industry analyst Alan Mutter points out, the graying of the newspaper audience has accelerated dramatically in recent years. Three-quarters of newspaper readers are now over the age of 45. Only 6 percent of people ages 18 to 24 are newspaper readers. That’s why developing attractive — and profitable — digital offerings is vital to the future of every newspaper organization.
Finally, some news that that casts a shadow over the fish-wrap factory on the east side of the river, as KFAN radio host Dan Cole puts it. Journal Register Co. last week sent layoff notices to thousands of employees at its media properties in 10 states.
The move was a legal technicality arising from the sale of Journal Register out of bankruptcy to a hedge fund. The new owner will lay off all the company’s employees, then decide which ones it wants to hire back as it takes over. Some jobs will undoubtedly be lost, while many who keep their jobs will see pay cuts.
The St. Paul connection is this: Journal Register is managed by a holding company called Digital First Media. That company also manages MediaNews Group, which owns the Pioneer Press. It’s a confusing stew of interconnected companies.
But here’s the takeaway: A corporate cousin of the Pioneer Press is being shuffled yet again by the big-money boys, whose main interest in these deals is always slashing expenses to squeeze short-term profits out of the transaction.
If I were working at the Pioneer Press, I’d be worried that my cousin’s infection could spread to the whole family.