Major newspapers throughout the country are bleeding. They are facing reductions in size and many are struggling to even remain relevant in this age of access to instant information. The most recent example of the problems facing newspapers are the layoffs at my hometown newspaper, the Baltimore Sun. The Baltimore Sun is a Tribune owned company and is the largest newspaper in the state of Maryland. The Sun recently laid off about 30% of its staff and more layoffs are expected. The Sun has employed several cost cutting measures to stay afloat such as downsizing staff and decreasing the size of the print editions. None of these moves have worked. Even major newspapers like the Washington Post are losing money for the first time in the paper’s history.
Newspapers such as the Washington Post and New York Times will always exist in some form or another. Cable television, blogs and online sites rely on the daily content that newspapers produce. But smaller papers such as the Baltimore Sun are facing the very real possibility of extinction. Newspapers continue to face declines in ad revenues as their subscription base erodes. Google is the king for advertisers seeking to reach customers through content. Websites like Craigslist have practically destroyed the classified section in newspapers. Careerbuilder and Monster.com have changed people’s reliance upon newspapers for employment information. Warren Buffett has stated that the business model for newspapers in not sustainable and will only continue to erode. I have to agree with his assessment and believe that over the next few years things will only continue to get worse.
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