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Oct 23, 2008

Spin Control, WSJ, NYT, McClatchy

Wall Street Journal print circulation is flat, online growing

According to Editor & Publisher, the Wall Street Journal is set to announce next week that its Monday through Friday average daily circulation for the last six months has remained constant.  Even though they have failed to increase their circulation figures, they have remained constant when most other papers are reporting sliding figures.

WallStreetJournal.pngThe WSJ did manage to increase its individually paid circulation by 2.4%, meanwhile other-paid (which includes employee, hotel, Newspapers in Education and third-party copies) circulation declined by 16%.  Online subscription has increased by 7.4% from one year ago.  In addition, visitors to WSJ.com increased by 137% this year.

Despite downturn, newspapers still profitable

According to PaidContent, although ad revenue is down 19 percent and interest expenses on $2.1 billion of debt, newspaper companies are still profitable.   

McClatchy CEO Gary Pruitt believes that ad revenue declines are cyclical and newspapers will not go out of business.

PaidContent's Lauren Rich Fine offers this advice, "For an industry that well understands it serves the greater good, come to terms with lower margins. And then go private!"

Arthur Sulzberger: New York Times willing to evolve

On Wednesday, October 22, chairman and publisher of The New York Times CompanyArthur Sulzberger Jr. made a speech at theWebbyConnect conference about transformations at the New York Times.

"Our 21st-century news cycle, with its trials and tribulations, feels even more immediate because of our access.  It is reasonable to ask: Do we need all this news and information? Do we want all this news and information? Can we tolerate all this news and information?," Sulzberger asked.

He believes that in this day and age people are looking more towards trusted and pragmatic voices.  He also advocates an effort to reject "the increasingly frenzied 'apocalypse now, tomorrow, and forever' talk.  Quality content matters...trustworthy voices are more important than they have ever been."

Earnings Call: Gannett Expects More Declines On The Print Side, But Digital Growth Looks Stronger

[In progress] Things are so bad in the newspaper industry and the economy at large, Gannett (NYSE: GCI) is suspending the monthly revenue reports, said Gracia Martore, the company's CFO, during the morning earnings call. After highlighting the pain afflicting newspapers from the dismal housing market and global financial crisis, Gannett CEO Craig Dubow said that the challenges will only accelerate the company's drive to build up its digital business.

For example, apart from the poor Q3 showing—as reported earlier, net income plunged 32 percent to $158 million ($0.69 per share) and revs slid 8.9 percent to $1.64 billion—Dubow noted that while the wider shifts in the newspaper business, as well as the wider economic problems pushed real estate and employee classified ads down for most of its segments. That said, as it has been for most newspaper companies, digital has remained a bright spot. After pointing out that the Q3 digital segment brought in $77.5 million in revenues, compared to just $17.1 million the year before, broadcasting's online revenue was up 15 percent. Considering the slowdown in online ads, the double-digit growth is either a testament to how much focus the company has applied its web extensions or how far behind it was last year. Perhaps a bit of both.

Asked about trends on the print side during the Q&A, Dubow said there hasn't been much change—in other words, more and more declines. As for details about particular categories, auto ad spend, retail, packaged goods and telecom have been down significantly, with autos in the double digits.More to come

Circulation Falls Faster At Big U.S. Newspapers

The latest numbers show that circulation at the largest newspapers in the U.S. accelerated a decline, owing to readers' continuing defection to the Web and a concerted effort by many publishers to scale back unprofitable circulation.

[Newspaper Circulation Drops]Getty Images

The New York Times saw a circulation decline of 3.6%.

Weekday circulation at 507 newspapers fell 4.6% for the six months through September, compared with a 2.6% decline in the same period a year earlier, according to figures released on Monday by the Audit Bureau of Circulations. Sunday circulation fell 4.9% for the latest period, compared with a 3.5% decline in Sunday circulation reported a year earlier.

Newspaper and advertising executives say that part of the decline is by design: Publishers have answered advertisers' calls to cut back on circulating papers to hotels and through third parties and to reduce delivery to readers outside of a concentrated area.

"They've done a terrific job meeting advertisers' needs," said Craig Sinclair, vice president of advertising for Walgreen Co.

But the latest numbers paint a dark picture for an industry where plummeting ad revenue and tightening credit are forcing publishers to take severe cost-cutting measures.

All but two of the 25 largest U.S. newspapers posted declines for the period, led by the Atlanta Journal-Constitution, where weekday circulation fell 13.6%. The other major declines came at the Houston Chronicle, where weekday circulation fell 11.7%, and the Philadelphia Inquirer, which dropped 11.1%.

USA Today and The Wall Street Journal, the two largest U.S. newspapers by paid weekday circulation, were the only publications to post an increase for the period. Both papers increased circulation by 0.1%. Gannett Co. publishes USA Today; Dow Jones & Co., owned by News Corp., publishes The Wall Street Journal. The Journal reported last week that individually paid circulation was up 2.4%. Among the other top-five papers, weekday circulation declined 3.6% at the New York Times and 7.2% at the New York Daily News.

The fourth-ranked Los Angeles Times, which on Monday said it was cutting 10% of its newsroom staff, had a weekday decline of 5.2% for the period.

Sunday circulation, often seen as the best indicator of a newspaper's health, fell faster than it did during the week. The Houston Chronicle's Sunday circulation declined 15.7%, followed by the Star-Ledger of Newark, N.J., and the Philadelphia Inquirer, where Sunday circulation declined 14.7% and 13.8%, respectively.

Weekday Total Paid Circulation  
Newspaper NameAs of 9/30/08As of 9/30/07% Change from prior year
USA Today2,293,3102,293,1370.01%
Wall Street Journal2,011,9992,011,8820.01%
New York Times1,000,6651,037,828-3.58%
Los Angeles Times739,147779,678-5.20%
New York Daily News632,595681,415-7.16%
New York Post625,421667,118-6.25%
Washington Post622,714635,012-1.94%
Chicago Tribune516,032559,402-7.75%
Houston Chronicle448,271507,452-11.66%

Source: Audit Bureau of Circulations

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