Almost nothing has worked this year for E. W. Scripps, the parent company of The Commercial Appeal.
First, however, a little perspective is in order. The CA can and does still make money, although Scripps won't say how much or what its profit margin is at individual properties. The Scripps newspaper chain earned $58 million in profits on $431 million of operating revenue in the first nine months of 2008. Not great, but hardly a General Motors-style loss either. That said, the trend in circulation, advertising, and finance is not good.
The Wall Street Solution: A reverse stock-split and separation of the newspapers and network television stations into a new company in July was supposed to keep Scripps stock trading above $5 a share. Since that move was made, the stock has fallen from $11 to just over $3, and the dividend has been cut. Ownership of a newspaper in Memphis by a publicly traded company and its majority stockholders in Cincinnati who demand dividends and a rising stock price is not going to work.
The Web Solution: Shifting resources to the Internet is supposed to attract advertisers. But Scripps' papers get only 7 percent of their revenue from the Internet, reports show.
Hot News: The presidential election and the 2008 Olympics were an advertising boon to television stations but not newspapers. The Flyer and the CA provided broader coverage of local politics and both national conventions, but local television stations reaped the rewards of campaign advertising, especially from the Mississippi congressional races.
Turf Protection: Only about one in three households in Shelby County receives the CA. Internal documents obtained by the Flyer show that the CA's Sunday distribution, counting home delivery and newsstand sales, is 123,687, and average other-than-Sunday distribution is 99,958. Suburban papers are nimble, pay less, and don't have to be all things to all readers. Delivering papers to the suburbs is expensive when your printing press is in downtown Memphis. Combined circulation of suburban papers in Bartlett, Germantown, Collierville, and Millington is closing in on the CA.
Shrinking Your Way to Prosperity: Belt-tightening, like the 57 job cuts the CA made in October, reduces costs but also lowers morale and puts good reporters out of work. The recession is killing the businesses and classified ads that are the lifeblood of newspapers.
So, do print newspapers have a future? As I've written before, I think they do as long as there are coffee cups and bathrooms, but diehards will have to pay more for home delivery and news staffs will continue to shrink. I asked several current and former print journalists, broadcasters, and bloggers what they think of the future of print journalism. This is what they said:
Nevin Batiwalla is the editor of The Daily Helmsman at the University of Memphis. The senior from Germantown is majoring in — gasp! — journalism and works 12 hours a day, four days a week, at the paper. He was recently laid off from his part-time weekend job at the CA despite getting some positive references.
"I loved it. It was fun. It's what I want to do," says Batiwalla, who is getting married in June. "But now that I'm about to graduate, I see it's really tough to get a job right now. I can't sleep at night."
He thinks niche publications may be the future of print but personally likes the breadth of coverage and the mix of features and news in bigger papers.
"I read print newspapers, but I probably read more news online," he says. "There's something about holding a newspaper that I like. But other people my age ... I don't know anyone who reads a newspaper in print form."
The Helmsman gets a little subsidy from the university and can sell ads, but the paper has shrunk from an average of 16 to 20 pages per issue to 8 to 16 pages. The paper is affiliated with a college publisher that hosts its website for free but gets all the advertising revenue.
Blogger Thaddeus Matthews, whose mix of news, rumor, politics, and outrageous comments has won him a following, says there's decent money to be made on the Internet. Politicians are his biggest revenue category: "In a political month, I do real well. I average about $2,500 a month, but that is not really working at it. I spend more time on [getting] advertising for my radio show."
He does not subscribe to a print newspaper but is grateful for the boost he gets when his blog is mentioned in one. He says media coverage of the photographs he ran of the Lester Street murder victims "drove 100,000 people to my site in two days."
Unlike print papers, website visits are unaudited. But Matthews is confident in his business model.
"There's no overhead, except for the time you put into it," he says.
Blogger Tom Jones, a former print reporter, is the main author of the "Smart City Memphis" website, which provides serious analysis of local government, education, and fresh ideas.
"It's hard for me to see how newspapers survive," he says. "They're so heavily invested in their own legacy systems that I don't see them figuring out how to make the transition to the web."
Jones thinks the most likely survivors will be the really big and really small papers. He thinks the rest will become niche operations, customized to particular groups of readers. He's working on a "Memphis blog with 30 or 40 innovative thinkers" that would become the place to look for Memphis happenings and ideas, but funding it is a puzzle.
"Is there any money in blogs?" he asks, rhetorically. "If there is, I haven't figured it out. It's definitely a loss leader."
Jon Alverson is publisher of the Millington Star, part of the West 10 Newspapers group of paid and free suburban weeklies that includes the Bartlett Express, Shelby Sun Times, and Collierville Independent plus the Shopper's News. The group prints 119,000 papers a week, or 19,000 more than the CA's midweek count.
Alverson, 33 years old, is a print guy. "Our saving grace is that we are going to get enough of bloggers. So many have written so much that so few read. We'll go back to someone who provides a salient, vetted, and fair news angle," he says.
The Star's circulation is just under 5,000. A year's subscription and home delivery costs only $22. Less than 10 percent of the paper's revenue comes from Internet advertising.
"We're not really in competition with The Commercial Appeal," Alverson says. "We serve a different kind of customer. We want to be the Millington newspaper."
Janice Broach is a veteran news reporter for WMC-TV Channel 5, one of four television news operations in Memphis. Newspapers may be losing classified ads to the Internet, but surveys show that television is where the majority of Memphians go for news. And like newspapers, they're investing in their websites.
"We are pretty lean, but television stations for the most part have not been cutting back," she says.
Broach thinks newspapers have a future because they can do longer and more in-depth stories: "We have to rely on video, and we only have so much time. They can talk more about the minutiae." As for newspapers adding their own video on their websites, "We are the masters of video, but better something than nothing."
Mike Fleming is a former Commercial Appeal reporter who made a successful mid-career transition to radio, where he hosts The Mike Fleming Show on WREC-AM 600. He is pessimistic about the prospects for his former employer.
"I don't think they have a future," he says. "The way we envisioned it is long gone. I can't get through the day without reading a paper, but I am in a vast minority. They have killed themselves by chalking off conservatives and Republicans and a broad spectrum of people. But I don't think anything could have saved them anyway. The Internet has eaten them alive. There may be a way to make money off it, but I'm not smart enough to know what it is."
Eric Barnes is publisher of the paid-circulation Memphis Daily News (circulation 3,000) and its free weekly edition, The Memphis News (circulation 11,000), launched last summer. The hybrid business model relies on veteran local reporter Bill Dries for news, a profit center of liens and licenses and other paid public notices, and a close affiliation with the Chandler Reports, a real estate data base that costs $25 a month and is heavily promoted in the company's papers.
"We think print has a future," Barnes says. "We have emphasized the web heavily for some time but see them coexisting. For us as niche papers, that makes a lot of sense. I don't envy the dailies trying to remain general-interest, mass-distribution papers."
The Daily News prints its own newspapers (unlike the Flyer, which is printed in Jackson, Tennessee). That helped them launch a new weekly in a bad economy. The papers get less than 10 percent of their revenue from online ads. Display advertising in the print papers is up 30 percent this year, Barnes says.
"It is not good for cities to have their newspapers so under pressure," he adds. "Love 'em or hate 'em, they're an important source of information."