Publishers Seek to Save Production, Printing Dollars

Dr. Sauders has passed along this interesting bit of newspaper industry information. TW note: the drop in classified revenue (Tampa Tribune) is attributed in some cities to the growth and use of CraigsList.

US Newspapers Move to Limiting Number of Sections
by Ken Doctor, Affiliate Analyst - San Jose, California

Saving money on production and printing is key, as publishers struggle to convince paying print readers that less doesn't seem like less.

Important Details: The New York Times is moving to a two-section local edition paper, starting Oct. 6. The Times will be putting its Sports section behind its Business section and its Local and Opinion page into its main section. The move affects only the metro New York City area, and not the Times' national edition. The purpose is clear: reduced costs in printing and production. Major costs saved are in labor, as the new scheme will significantly reduce overtime wages paid.

"We are not reducing the space devoted to Metro or Sports news," Times's publisher, Arthur Sulzberger Jr. told his staff in a memo.

The move follows a number of sectioning changes seen throughout the US this year. Numerous papers have cut standalone business sections, merging that content into other sections, as many have cut back on local business news staff (see recent report, Publishers Re-Target Local Business News Opportunity June 23, 2008).

Overall, most companies have cut back newsprint usage at least 10-15%, producing less news and displaying fewer ads. That has resulted in more thin -- often four-page -- sections, reinforcing for readers the shrinking product and offering new production configuration challenges and opportunities.

This week, word leaked out that the Tampa Tribune is considering a one-section paper. The Tribune, which has a daily circulation of more than 200,000, recently reported a 32.5% decrease in classified revenue for the second quarter.

As sections decrease, ad sales options change. Publishers will be more able to offer advertisers placement in the "A" section, long sought after by advertisers, and less able to offer preferred placement on section back pages, and on pages 2-5 in any particular section.

Implications: As some observers have pointed out, one section papers are nothing new -- tabloids have been doing it for decades. In Europe, two-section broadsheets are much more common than they have been in the US. Indeed, Outsell believes it's not the number of sections that is key, but rather the nature and fit of the daily print product in the internet age that's the biggest question going forward.

Certainly, publishers need to make many kinds of decisions to cut costs as long-stable revenue streams deteriorate. Production and printing -- the #2 cost after staff -- needs to be high on list.

The biggest questions here is what the daily, snapshot print product becomes. For some, it is becoming more an analytic read, a push that the Wall Street Journal started making back in 2006, and other papers are moving to as well. Some believe the newspaper needs to be more of a guide to the web, and that's true for those (especially younger) readers who use the news for web effortlessly. For baby boomer readers and up, though, it's that print edition that keeps the subscriber money coming in. This group is publishers' best hope for hanging on to as much print revenue for as long as possible, as they make digital transitions.

Consequently, for the next five years at least, it'll be a balancing act, between the more modern analysis/web pointer model and the traditional "paper of record." Finding that balance is the hard thing -- particularly when at the same time newspapers are try to convince increasingly skeptical readers that less isn't really less.