When was the last time you actually bought a newspaper? And have you actually seen the Los Angeles Times lately? I don't want to be Chicken Little but the sky is in fact falling when it comes to traditional (i.e. dated) forms of obtaining news and information.Exhibit A: The New York Times Company posted a $335,000 loss in the first quarter — one of the worst periods the company and the newspaper industry have EVER seen.
The number has fallen far short of both analysts’ expectations and its $23.9 million profit in the quarter a year earlier.
The company did break even on a per-share basis, compared with the average analyst forecast of earnings of 14 cents, down from 17 cents in the first quarter of 2007.
The main source of the company’s revenue, newspaper advertising in print and online, fell 10.6 percent, the sharpest drop in memory, as the industry suffers the twin blows of an economic downturn and the continuing long-term shift of readers and advertisers to the Internet.
In a conference call with analysts, Janet L. Robinson, president and chief executive on the New York Times Company, said it was “a challenging quarter, one that showed the effects of a weaker economy,” compounded by “a marketplace that has been reconfigured technologically, economically and geographically.”
Looking ahead, she said, “We see continued challenges for print advertising in a faltering economy.”
The company recorded an operating profit of $6.2 million on revenue of $748 million, down from $54.5 million in operating income on revenue of $786 million a year earlier.
The poor showing stemmed from The Times Company’s core news media group, which includes The Times, The Boston Globe and The International Herald Tribune, as well as several regional newspapers.
The Times Company’s declining fortunes have sowed shareholder discontent, and the weak first-quarter results could intensify calls for a shift in strategy. A pair of hedge funds, Harbinger Capital Partners and Firebrand Partners, acquired a large stake in the company early this year, demanding that it sell assets and invest aggressively in Internet operations.
Across the industry, newspaper ad revenue — print and online, combined — fell almost 8 percent last year, the second-worst decline in more than half a century, according to the Newspaper Association of America. The Times Company’s ad revenue dropped 4.7 percent last year, when adjusted for a change in the length of its fiscal year.
Over the last year, classified ads continued a decadelong flight to the Web, and display ads for real estate and cars fell sharply as those industries contracted.
Black Print & Electronic Media Will Soon Be Extinct!
We need to wake-up family. Because you know when White folks have a cold, Black folks have pneumonia. Translation, is that how can newspapers, magazines, radio and small local cable stations owned by African Americans possibly compete?
They can't, which means they're going to be folding up and getting out of dodge unless they recognize that the Internent is where the action is. [Source]