The Barbarians of Wall Street

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The Barbarians of Wall Street

For KCRW, I'm Nick Madigan of The Baltimore Sun with Minding the Media.

Contrary to popular opinion, American newspapers might not be headed into a free-falling spiral toward their deaths.

Yes, I know: Newspapers lost about 1,500 jobs last year, and more than 1.5 million in circulation, but those declines amount to only about 3 percent of the totals. And the industry as a whole will still post profit margins this year of about 20 percent, healthy by any standards, if not quite up to the desires of Wall Street.

If one combines print and online, the readership of many newspapers is higher than ever.

It's premature, therefore, to suggest that newspapers are rapidly becoming extinct, says a new study, "The State of the American News Media, 2006," by the Project for Excellence in Journalism, a research institute at Columbia University.

We saw a positive development in newspapers yesterday, with the purchase of Knight Ridder, the nation's second-largest newspaper chain, by the much smaller McClatchy Company, which has made a bold, $6.5 billion investment in an industry beset by uncertainty.

For some of the papers in that deal, however, the uncertainty will continue. McClatchy announced that it would immediately put up for sale 12 of the 32 Knight Ridder papers, including three in California: the San Jose Mercury-News, the Contra Costa Times and the Monterey Herald.

Those three might be ripe for picking by William Dean Singleton, who already owns the Press-Telegram in Long Beach, the Daily News of Los Angeles and other papers in the San Gabriel Valley, Pasadena, Whittier, San Bernardino and Redlands.

Is Singleton trying to become the next William Randolph Hearst? We'll have to wait and see.

In this turbulent industry, nothing is certain.

I spoke yesterday with Carl Hiaasen, the comic novelist from Florida. He has spent 30 years at the Miami Herald, which is about to become part of the McClatchy empire.

"I have my fingers crossed," Hiaasen said. He echoed other reporters' unhappiness with corporate newspaper owners who have cut staffs in recent years to save money, even as the papers remained profitable.

"It's been a brutal process," Hiaasen said. "The Wall Street barbarians are everywhere. It's all about the shareholders and the bottom line, so any improvement would be welcome. Any mercy shown would be greatly appreciated."

At the Herald, he said, "Our journalism has suffered beyond recognition, and the morale of the staff along with it. There are still flashes of brilliance, but you're struggling against tremedous staff shortages."

Some observers of the industry see far too much pessimism in its ranks.

Len Kubas, a consultant in Toronto who specializes in media companies, said yesterday that the worst enemies of newspapers "are the myopic, shortsighted people who work for them who say they're doomed."

Newspapers, he said, "have a terrific opportunity to combine product on paper with product on the Internet. In many markets, newspapers have franchises that many communications companies would die for."

In fact, in the Columbia University study I mentioned earlier, newspapers are still providing almost all the original news content on the Internet.

Some of the major Internet challengers "appear to have made less progress in the last year when it comes to Web content than the old media," the study said.

"Even though the Internet has become a ubiquitous source of news and information for a large majority of Americans, trust in it continues to shrink," the study said. "For the third year in a row, the number of Americans who say it is reliable and accurate declined. In fact, fewer than half now say that most or all of the information on the Web is reliable and accurate."

And that includes blogs.

This is Nick Madigan of The Baltimore Sun, Minding the Media on KCRW.



Nick Madigan