On August 10, 2014, which was, incidentally, my mother Rachel's 96th birthday, media columnist David Carr of The New York Times published published a column entitled "Print is Down, and Now Out. Media Companies Spin Off Newspapers to Uncertain Futures." The primary issue that Carr raised was that newspapers—virtually all of which were still published both in print and online editions — could not generate enough advertising revenue fast enough, to satisfy the growth demands required by Wall Street investors. For this reason media companies, which derived most of their income from television, spun off their newspaper divisions. From his column I quote selections:
"A year ago last week, it seemed as if print newspapers might be on the verge of a comeback, or at least on the brink of, well, survival.
"Jeff Bezos, an avatar of digital innovation as the founder of Amazon, came out of nowhere and plunked down $250 million for The Washington Post. His vote of confidence in the future of print and serious news was seen by some — including me — as a sign that an era of “optimism or potential” for the industry was getting underway.
"Turns out, not so much — quite the opposite, really. The Washington Post seems fine, but recently, in just over a week, three of the biggest players in American newspapers — Gannett, Tribune Company and E. W. Scripps, companies built on print franchises that expanded into television — dumped those properties like yesterday’s news in a series of spinoffs. . . .
"The persistent financial demands of Wall Street have trumped the informational needs of Main Street. For decades, investors wanted newspaper companies to become bigger and diversify, so they bought more newspapers and developed television divisions. Now print is too much of a drag on earnings, so media companies are dividing back up and print is being kicked to the curb.
"Setting aside the brave rhetoric — as one should — about the opportunity for a “renewed focus on print,” those stand-alone print companies are sailing into very tall waves. Even strong national newspapers like The Wall Street Journal and The New York Times are struggling to meet Wall Street’s demands for growth; the regional newspapers that make up most of the now-independent publishing divisions have a much grimmer outlook.
"As it turns out, the journalism moment we are living in is more about running for your life than it is about optimism. Newspaperscontinue to generate cash and solid earnings, but those results are not enough to satisfy investors.
"Even the most robust evangelism is belied by the current data. Robert Thomson, chief executive of News Corporation, espoused the “power of print” on Thursday even as he announced that advertising revenue at the company plunged 9 percent in the most recent quarter.
"And remember that it was Mr. Thomson’s boss, Rupert Murdoch, who started the wave of print divestitures when his company divorced its newspapers last year, although it did pay out $2 billion in alimony, which gave the publications, including The Journal, a bit of a cash cushion. (News Corporation’s tepid earnings report came two days after Mr. Murdoch, who has swashed more buckles and cut more deals than almost anyone, was forced by the market to let go of his latest prey, Time Warner.)
"The people at the magazine business Time Inc. were not so lucky, burdened with $1.3 billion in debt when Time Warner threw them from the boat. Swim for your life, executives at the company seemed to be saying, and by the by, here’s an anchor to help you on your way.