So let's sort out the facts. First, despite the fact that this is certainly a bleak year for newspapers, the vast majority of them are still either respectably profitable or would be if not for taking on obscene debt in each company's mad quest to own the world. The Chicago Tribune company's bankruptcy, for example, isn't because its many newspapers aren't profitable (in fact, papers like the LA Times do very well) - it's because the new ownership of the Tribune company took on massive debt to buy out the company, on top of the massive debt the Tribune took upon itself to gobble up other papers around the country. It's debt that's causing these massive problems, not a lack of profitability. Sadly, that's reflective of the economy at large - too many stupid decisions all across the board on making decisions of debt have led us down this path, but that's another blog for another day.
The question is what is the media to do? The companies that are saddled with too much debt can't do much - they took it on, they have to pay for it, or go bankrupt and hope for Chapter 11. I've long suspected that newspapers would do well to get out of Wall Street and come up with smaller business groups that don't care about making 20-30% profit margins and will happily settle for a stable 5-15% year in and year out, good years and bad. Turning for-profit companies into nonprofits is another interesting idea, one that would not only lead to balanced books, but probably better journalism too.
But there's some far more interesting - and radical - ideas, too. First, maybe some newspapers would be better off if they didn't put their content online? It's certainly a business model that has shown some success for some papers. Particularly interesting is the second link, which talked about how Japanese papers have done things differently than their American and European counterparts.
While newspapers in Europe and the US look increasingly to the internet to secure their future, Japanese papers have restricted their web presence - and have suffered a smaller decline in readership and advertising.It may still be a bad long-term decision, leaving them open to companies that aggressively push online content, but it may just work. The greater point, though, is maybe there is no one solution. Maybe there's several. Maybe there's several each company must make at a time.
The biggest disadvantages still facing newspapers is their resistance to be out on the forefront on the web, creating the best sites that maximize profits with all the advantages they've enjoyed for so long. Instead, sites like Craigslist, which isn't even really a for-profit venture as best I can tell, ate deep into newspaper profits. It's absurd that Boston.com never challenged that market (hell, it should have thought of it to begin with), especially when Craigslist, to this day, isn't even a particularly great site.
It's clear that some newspapers are going to sink over the next year or two, but that doesn't mean there's anything intrinsically wrong with the industry. The papers that go down are going to be the ones that borrowed too heavily, usually to buy companies that should never have been sold in the first place. Perhaps this is the ultimate justice for the companies that decided to become capitalists run amok. They took on too more than they could chew and are now going down hard. This is how things are supposed to work; the only bad part is no one said no to begin with, because 15,000 people in the newspaper business have already lost their jobs this year in the US. Maybe now the Government will decide to again regulate the industry and make sure they don't become monopolies - not only is that bad for the consumers, it's proven to be a business strategy only insofar as it is a strategy to end that business.