Newspaper News (MNI)(JRC)(GCI)(NYT)

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The news about the demise of newspapers is now at least two years old. Each month newspaper chains put out their advertising numbers and each month they are worse.

The only real question about the newspaper industry is whether online versions of print papers can help offset falling print ad revenue. So far, that has not been working well. The best case is probably The New York Times (NYT) which gets about 10% of its revenue online now.

Goldman Sachs now says that a recession will take newspaper ad revenue down 7.9% next year. Only recently the investment bank was calling for a 2.6% decline.

This year will probably be the year that the newspaper industry has dreaded. Some companies with significant debt like McClatchy (MNI) and Journal Register (JRC) may have to go through large financial restructuring. Common shareholders may not make it out alive. At firms like Gannett (GCI) and The New York Times the only alternative will be to cut staff, perhaps sharply.

The future has finally caught up to the industry.

Douglas A. McIntyre