An article (Reporter’s Notebook; Our Towns: “There’s Hope for Local Journalism;” September 18, 2019), by Deborah and James Fallows in The Atlantic looks at one small-town newspaper that is trying to go against the tide of newspaper ownership by Wall Street investment firms, which are distant, both geographically and philosophically from the publications they own.
Deborah and James Fallows write what small-town newspapers are up against:
The conventional view of the local-journalism crisis is that running a small-town newspaper just isn’t a viable business anymore—now that the internet advertising has drained off revenue, and now that virtual communities and social media have displaced real-world connections and communities.
Those pressures are all too real. (Sobering details on the collapse of ad revenue are here.) But some of the remaining success stories in this troubled field suggest that the ownership structure of local news organizations may matter as much as internet-era advertising shifts, in determining which organizations survive and which perish.
In short: Increasing evidence suggests that the local newspaper business may still be viable, simply as a business. What it can no longer do is provide the super-profit levels that private equity groups expect from their holdings, and that they demand as a condition of letting the papers exist. Papers that are doomed under private-equity ownership might have a chance in some different economic structure.
This proposition—that newspaper ownership is as important as internet-era advertising trends, in deciding local journalism’s future—was examined at length in a 2017 article in The American Prospect by Robert Kuttner and Hildy Zenger (the latter a pen name). It has been a theme connecting our previous newspaper-survivor reports, from Maine to Mississippi. And it is the idea behind a new weekly print newspaper whose first edition came off the presses this month, in Provincetown, Massachusetts, at the tip of Cape Cod.Small town papers run by locals are important, because business owners have a stake in the communities in which they live. Moreover, they are not as profit driven (8 percent profit is good) as publications owned by equity Wall-Street investors, which/who care only about much higher double-digit profits of at least 20 percent a year. Is this really sustainable year after year? Unlikely, which explains the mess and chaos that Wall Street creates and for which it is widely known.
I remember a time, in the early 1970s, when everyone thought 7 percent was good enough. This, no doubt, was before the "greed is good" business principle started to become institutionalized and normalized and a model to emulate for success. We witness the results today, four decades later, and we can say it is not all good or pleasing to the eye. Small towns are not the only ones to suffer.
***************For more on The Atlantic story, go [here].
For more on the The Provincetown Independent, go [here].