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Many of these and other media companies built their portfolios using leverage and took on substantial amounts of debt. Advertising revenues in many metropolitan papers over the past 18 months have plummeted – some categories are off by as much as 75 percent. As a result, those media companies that amassed huge amounts of debt coupled with a significant downturn in advertising are now discovering they don’t have the cash flows to service the debt. So, the media companies that fall into this category are in a crisis, but painting all newspapers with the same broad brush doesn’t provide an accurate picture of the industry and certainly not Journal Publishing Company.
Obviously we’re in a market downturn that’s affecting newspapers and most other businesses. This is one of the first times I can recall that we’ve faced a housing crisis, an energy crisis, and a credit crunch at the same time. One has to go back to 1907 and 1931 to find calendar years that inflicted greater damage on U.S. stocks. What began in the first half of 2008 as a challenging investment environment evolved into a period of financial crisis in the second half of the year and carried over into 2009.
However, readers and advertisers have not abandoned community newspapers that serve their community and contribute to a real sense of community. Our challenge at Journal Publishing Company in our newspapers – Daily Journal, Monroe Journal, Itawamba County Times, Pontotoc Progress, Chickasaw Journal, Monitor-Herald (Calhoun), New Albany News-Exchange, Southern Sentinel (Tippah), and Southern Advocate (Benton) – is to provide relevant local information that impacts people’s lives.
According to a 2008 National Newspaper Association survey, 86 percent of adults over the age of 18 read a newspaper every week. Seventy-five percent of those readers read most or all of their paper. On average, readers spend 45 minutes reading an issue of their paper compared to 42 minutes from the 2007 survey, and 38 minutes in the 2005 survey.
Most of the research and news reports on the “struggling” newspaper industry are based on what’s happening in major metropolitan markets, but our audience continues to grow. For three consecutive years the number of subscribers to the Daily Journal has increased, and last year the number of subscribers to our weekly newspapers increased more than 5 percent. We now reach more than 71 percent of the households in Northeast Mississippi. This is in complete contrast to news reports announcing the end of newspapers. We have a different story to tell because even with all the opportunities for improvement that we face, we remain focused on building community and improving the quality of life in Northeast Mississippi through the products and services we provide.
Local advertisers continue to value the hyper-local news we provide and the desirable local audience we deliver. Are we affected by the current economic downturn? Absolutely. Are we in a crisis? Not as long as we remember our customers and continue to provide quality products that are of value and that deliver results.
There’s no denying the media landscape is changing at an unprecedented pace, and we can’t ignore these changes. That’s why we’ve developed and implemented seven new Web sites within the past year with plans to launch a new regional site in the coming weeks.
We certainly have challenges, and we need to work hard to continue finding ways to make our newspapers more useful to our customers, but the death of newspapers is an exaggeration. Newspapers, and especially community newspapers, are not on the verge of collapse. Opportunities exist in this downturn to position Journal Publishing for a strong, vibrant future.
Clay Foster is president of Journal Publishing Company. Contact him at 678-1505 or clay.foster@djournal.com.
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