With seemingly every industry these days claiming the mantle of being too big to fail, and thus entitled to a government handout, shouldn't newspapers have first dibs on the title relative to economic importance? After all, it was Thomas Jefferson who said, "If I had to choose between government without newspapers, and newspapers without government, I wouldn't hesitate to choose the latter."
Unfortunately, it seems like we will be getting the worst of all worlds. Fitch Ratings reports that it expects newspapers to start defaulting on their debt next year, and as they fold, several major cities may be without a daily paper. Fitch has rated the bonds of both McClatchy
There's no doubt that newspapers are a hard sell these days. Advertising revenue fell more than 18% in the third quarter, the largest decline ever in the 40 years that quarterly numbers have been tracked. At New York Times
Yet, do declining ad revenues and rising newsprint costs mean that News Corp
While the Journal's "What's News" column still appeared on the front flap (the rest of Dell's ad ran behind), you couldn't even hold the section when you folded it back, making it a useless appendage. Like all those subscription postcards inside a magazine, that piece got tossed away.
Certainly, papers need to take creative measures, and advertisers do too, for that matter. The Times and the Journal are said to keep a close eye on each other's advertisers, plundering them if they can, but you have to wonder whether Dell got its money's worth from the attempt. While I fretted that Rupert Murdoch would turn the Journal into a tabloid when he first had designs on acquiring Dow Jones, I still don't think we'll see a "Page 6 girl" gracing the gray pages of the paper, whatever it may do for circulation. Jefferson might very well have opted for "none of the above" if it came to that.
Fool contributor Rich Duprey subscribes to the Wall Street Journal but does not have a financial position in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.