Skip to comments.US media in deep financial crisis (Dinosaur Media DeathWatch™)
Posted on 12/09/2008 2:48:34 AM PST by abb
NEW YORK: Faced with declining advertising revenue and mounting debt, the US media has plunged into a deep financial crisis.
The publisher of the two most popular dailies, The Los Angeles Times and The Chicago Tribune, has filed for bankruptcy. The New York Times is seeking a $225 million loan against its headquarter in mid-town Manhattan. The popular Miami Herald has been put on sale by its owner. And stocks of CBS, one of the popular new channels, have fallen below $5 in recent weeks.
Most American media outlets are now struggling to survive. They have gone into massive cost cutting, resulting in hundreds of journalists and non-journalists in the mainstream media losing their jobs in recent months.
In the latest sign of crisis that has hit the once flourishing US media, The Tribune Company - which owns as many as 23 television stations and 12 newspapers including its flagship Los Angeles Times and The Chicago Tribune on Monday announced that it has filed for bankruptcy. The company is said to have nearly $13 billion in debt compared to $7.6 billion in assets.
"Unfortunately, factors beyond our control have created a perfect storm -- a precipitous decline in revenue and a tough economy coupled with a credit crisis that makes it extremely difficult to support our debt," Tribune CEO Sam Zell said in a statement on Monday.
David Carr, popular media columnist for The New York Times, said: "Media companies have been hammered on the leading edge of the recession because they run on advertising, a discretionary expenditure that always is among the first things to go."
The New York Times Company, which runs one of the most popular American newspapers by the same name, on Monday said it will borrow as much as $225 million against its skyscraper property in mid-town Manhattan, which happens to be its headquarter.
This has become essential to prevent a possible cash flow jam. It is facing a debt repayment of $400 million. Notably, stocks of The New York Times have dropped 55 percent this year.
So have stocks of several other media outlets. Besides CBS news channel, News Corp stocks have recently been trading below $6 and those of Time Warner have dropped under $8.
Only a few days ago, The McClatchy Company, America's third largest newspaper chain running more than 30 newspapers, had put its popular The Miami Herald newspaper on sale. The Miami Herald with a circulation of 210,000 has won as many as 19 Pulitzer Prizes.
Latest statistics released by Newspaper Association of America has disclosed that newspaper advertisement revenue in the third quarter of this year dropped by $2 billion; a record 18.1 percent decline. The online ad revenue too declined for the second quarter in a row, it said.
The USA Today had announced a cut in jobs in its newsroom a fortnight ago. So did The Chicago Tribune last week. Gannett, the parent company of USA Today, has announced that it will cut 10 percent of its workforce at the more than 80 newspapers run by it.
The 17-member Cox Newspapers chain has announced it is closing down its Washington bureau and would depend on news agencies now. Independently-run Milwaukee Journal-Sentinel has lost 20 percent of its staff in the past 18 months. A majority of the US media has already shut down its foreign bureaus or cut costs drastically.
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Zell on Tribune, in His Own Words
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Next Year Is Looking Even Worse
The newspapers of this country are a disgrace.
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Tribune Co. Files for Chapter 11 Protection
All of these Christmas presents coming from the Media! Anyone who wants more than this is just greedy.
I wonder how much food you can buy at the supermarket with a Pullitzer Prize?
Zell could recoup investment, but employees likely won’t
Tribune Co. files for Chapter 11 bankruptcy protection
NBC may cut hours of TV programming
Tribune Co.’s crisis has been years in making
Debt-Saddled Tribune Co. Files for Bankruptcy Protection
They deserve everything which happens to them because of their terribly bad judgement. May there be no rest, only torment, the same torment which they thrust upon a public for their lying, deceptive, unfair, republican, conservative hating bias!
Tribune Bankruptcy Snares Employees
How to monetize “air”
Viacom CEO Downplays Recent Job Cuts
Motorhead said it best “Now I’m the one Dancing On Your Grave”.
Just a small amount of hemlock tea.
These big newspapers would rather get Obama elected than save their own hide. How shortsighted is that?
These big newspapers would rather get Obama elected than save their own hide. How shortsighted is that?
Newsies have always told us their vocation is a “calling.” Well, now they get to do it for free, like everyone else who says they do the Lord’s Work.
I like that idea. The libs get to work for free!
They like the word “popular.”
What a Tribune Company bankruptcy could mean for California
One blogger last night opined that now that the dam is broken, we can expect other bankruptcies to follow rather quickly.
I predict McClatchy within the first quarter of next year.
McClatchy Presents at UBS Media Conference Today
Did the Miami Herald’s $190 million land deal collapse?
A common theme is denial.....not our fault.
Over-Zell-ous? Real Estate Mogul Felled by Media Biz
Journalism Expert: Tribune Bankruptcy Indicates Print Media’s Failure As Economic Model
Tribune is latest to feel sting of bad economy
Sam Zell’s Plan D: It’s All About Buying Time
The interesting thing to me is that Zell apparently bought the Tribune with the cash in the pension fund and loans from banks.
The employees are now pensionless and the bank debt is merely part of the overall unfathomable bad debt aggregate. Zelll’s loss turns out to be time.
outstanding...hopefully they will go out of business and people will be forced to read and research for themselves for once...this is good thing - no more spoon feeding the public...
Back when this was all going down 1 1/2 years ago, I emailed every business reporter I could and pointed this out. To my knowledge, only Theo Francis of the WSJ wrote very much about it. I even talked with one of the biz reporters at the LAT, but all he ever said was that he was “concerned” about it.
Watch for a slew of stories in the next few days about how the employees were screwed out of their retirement.
Finally, a couple of months ago, several retirees filed suit.
Ex-Times reporters sue Zell
And yet, talk radio is doing just fine.
I remember reading a Grishman novel a few years ago where the central character ran a small town weekly newspaper. He made plenty of money because he knew what his readers wanted: he covered all the local goings-on and made sure lots of people got their names in the paper. In the small town where we previously lived, EVERYONE read the paper, and the first page we all turned to was the Police Blotter.
My point is that the NYT et. al., have lost all notion of how to sell newspapers. The average reading American doesn’t want to pay to be lectured by a bunch of prissy liberals.
MORE LAYOFFS PLANNED
The company informed Guild leadership this afternoon that it intends to eliminate 35 bargaining-unit jobs at the Inquirer and Daily News effective Dec. 31.
They cannot figure it out, we buy papers to read about what is happening in the world. Not for propaganda.
They need not cut staff to fix the problem, but probably would have to hire “other” staff to fix it.
They simply need to report the news as it happens, unbiased.
“They just don’t have a clue.”
Times-Dispatch lays off 18 employees
Barclays: ABC May Be Next To Wield Job Cuts
I guarantee that they are setting the stage for a government bailout.
However, in this instance, I believe that government involvement is a violation of the 1st amendment.
My logic is as follows:
***Congress shall make no law ...abridging the freedom ...of the press; ****
1. By assisting media companies, Congress is ENABLING a particular press versus other more viable competitors. Therefore, they are injuring (abridging) those forms of press that are successful.
2. By underwriting media companies, Congress is siding with that message just as much as they would be siding with a bible company that would be in hard fiscal times.
NBC Considers Fewer Prime-Time Hours
I was a long-time Chicago Tribune reader, and I recently cancelled my subscription. The paper had become completely unreadable. The paper had a change of strategy and decided to go after the more “hip” younger urban reader. They completely changed the format to where it doesn’t look anything like the old Trib. There was a change in the editorial board, and the paper went from a conservative paper to an everyday Obama love fest. There is only one reporter, John Kass, who ever questioned anything about Obama’s past, but the rest of the paper was pro-Obama. For the first time in recent history, they did not endorse the conservative candidate. Their reporting of world news is now a little map of the world with one-word sentences in boxes that point to the particular country. In the front section, they usually have one article (usually about Obama) and the rest is advertising. Bottom line: the paper sucks.
One more complaint: their Soduku puzzles are usually unsolvable by logic and requires simple guessing. It is irritating to spend time looking for the logical conclusion when there isn’t one.
If I get to see Ted Turner living in a box under a bridge, I will be content.
And that's something even Obama wouldn't dare touch because the First Amendment guarantees no interference with the media from the government. A bailout of the Tribune and McClatchy companies would constitute a direct interference in a form of favoritism, and that's grounds for a major lawsuit.
“US media in deep financial crisis (Dinosaur Media DeathWatch)”
I won’t put it past them to try, though. The cry will be “think of the workers, jobs lost, unemployment, etc.”
I think this phrase has jumped the shark. (then again, "Jump the Shark" as a phrase has retrograded and has now jumped the shark.
Anyone taking bets on when some big city Democrat congressman tells us that we have a First Amendment obligation to bail out Big News...
On the up side - Eveything. On the down side - Nothing.
...but in order to protect the taxpayers’ interests, the government should appoint a “news czar” to oversee operations mand make sure future reporting meets appropriate social standards.