Another Chapter in the Continuing Story: Will Local Newspapers Survive?
It shouldn’t come as any surprise by now that TV and online news sources have absolutely pummeled the newspaper business. The latest insult added to the already numerous injuries is that barely a third of Americans prefer to get local news from newspapers rather than through their TV sets or computing devices.
According to a new report from Pew Research, 41% of Americans prefer getting local news by TV, 37% prefer online sources for local news, 13% prefer the print version of the local newspaper and just 8% prefer to get their local news from radio.
More than a third (38%) of U.S. adults now get their news from local TV stations and more than three-quarters (76%) of those get the news by watching TV instead of using a station’s online or social media sites. Among the group that still gets its news from newspapers, almost half (43%) use a digital source rather than a print version of the newspaper.
The Pew study also reveals the kinds of news most Americans say is either important or interesting from their local news media. A full 95% of U.S. adults put weather at the top of the list, followed by crime stories (94%) and local prices (90%).
Almost four of 10 U.S. adults (38%) don’t have a local news source they rely on regularly, and another 30% rely on only a single source. Only 17% of Americans “often” get their news from daily newspapers, and slightly more than half of those (54%) get their news from the printed paper while the rest use a digital source.
According to a report last September from Nieman Lab, newspapers have two choices: go online-only or close down. The problem has not been mass closure but mass shrinkage. Ad revenues fell by 26.4% year over year in the second quarter of 2018 at McClatchy, while Gannett saw a drop of 19.1% and Tronc (once again known as Tribune Publishing) posted a decline of 18%. The question is not if newspapers will survive; it’s now become when the last one will close?
A University of North Carolina database showed that 664 local newspapers went out of business between 2004 and 2014. In 2004 there were a total of 8,591 newspapers in the United States, nearly 1,500 of which were dailies. By 2014, the total had fallen to 7,927 and the number of dailies had dropped to 1,331. The vast majority (6,474, or 82%) had a total circulation of less than 15,000.
One final note about local newspapers: they act as a watchdog on local governments. A 2018 study found that municipal bond yields (the interest rate that local governments when they borrow money) rise by up to 0.11 percentage points (11 basis points) within three years after a newspaper shuts down. Doesn’t sound like much, but that’s an additional $11,000 for every $1 million borrowed.
For example, according to a GAO study in 2016, Macon-Bibb County, Georgia, with an estimated population of about 154,000, showed an estimated need to spend $17.7 million on a five-year plan to upgrade and repair its water treatment system. Borrowing that money with a 0.11% increase in interest would cost the local government nearly $195,000 in additional interest.
If 15% of the area’s local adult residents (about 17,000) pay $130 a year to subscribe to the (Macon) Telegraph, the local government easily saves that $195,000, which it would otherwise have to recover by charging higher service rates. And that’s just on one municipal project.
Local newspapers have monetary value as well as news and information value. Even that combination may not be enough to keep them in print, however.