Regional dailies evolve amid efforts to sustain local news

Last week was busy for advocates of saving America’s local free press system.

Publishers of more than 125 newspapers filed or announced antitrust lawsuits against Google and Facebook.

U.S. Sens. Maria Cantwell and Amy Klobuchar pressed Lina Khan, President Joe Biden’s nominee to the Federal Trade Commission, to address the journalism crisis.

Press advocates from government, academia and the industry also huddled (online) at a conference hosted by the liberal Open Markets Institute in Washington, D.C., on ways to sustain journalism and support democracy.

It’s great to see this momentum.

But as Minnesota Attorney General Keith Ellison said during the Open Markets event, this needs to go beyond “the academy” and elite circles — it “needs to be talked about at kitchen tables.”

People concerned about the potential extinction of local, independent news organizations should also ask their representatives in Congress to engage.

The number of newspapers in the U.S. fell by a fourth over the last 15 years, to around 6,700. A majority of counties have no daily paper and hundreds have no local news source at all.

Newspapers are evolving and adapting to the digital marketplace. But progress is uneven, uncertain and hindered by tech-platform behaviors that federal investigators believe are unfair and illegal.

My recent columns looked at how small, hyperlocal publishers are faring. Here are status reports, shared during the Open Markets conference, by regional dailies in Boston, Minneapolis and Seattle.

“All things considered business-wise we’re doing quite well,” said Dan Krockmalnic, executive vice president at The Boston Globe.

A local billionaire, sports mogul John Henry, purchased the Globe for $70 million in 2013 from The New York Times, which paid $1.1 billion for it in 1993.

Henry “invested significantly” in the newsroom and business side, Krockmalnic said.

The company has three main businesses — the Globe, the free Boston.com site and STAT, a health news site that soared during the pandemic. It’s now exploring ways to develop its TV, film and podcast intellectual property. More than half of revenue is still from print.

The Globe is profitable despite ad declines. “We accomplished this by increasing digital subscriptions dramatically and working to keep costs down,” he said.

Although it’s building “a structurally sustainable business,” Krockmalnic said, “we still have some way to go to ensure long-term success.”

The Minneapolis Star-Tribune is also growing under a wealthy local owner with a pro sports franchise. It went through a series of owners and bankruptcy before Glen Taylor bought it in 2014 for $100 million.

Taylor “is a very committed owner and has invested heavily in our newspaper and our new products,” said Randy Lebedoff, senior vice president.

The company has a mix of products in the metro area, reaching people who don’t subscribe to the Star-Tribune. An entertainment publication closed during the pandemic, but Lebedoff said they intend to restart a similar product.

Horrible events in Minnesota, including George Floyd’s murder, increased readership, growing digital subscriptions above 100,000. Still, print generates more than 50% of revenue.

Lebedoff noted that 82 papers closed in the state since 2004, and cities like Duluth and Rochester no longer have dailies. “We’re trying to cover those areas so we get readership into those areas to fill the gap,” she said.

The Star-Tribune has received one-time, six-figure grants from Google and Facebook.

“I asked our publisher how he would describe the help we get from Google and Facebook,” Lebedoff said. “He said ‘puny,’ so there you have it.”

The Seattle Times is also seeing digital growth but not enough to reverse recent declines, company President Alan Fisco told the conference.

The Times has been owned by the Blethen family since 1896.

Readership soared during the COVID-19 pandemic. “We had record audiences, yet we had dismal revenue,” Fisco said.

Over the last 10 years, The Times’ print advertising declined 80% and digital advertising grew 10%.

In that same period, it went from more than 1,000 employees to 449. If further cuts are required, they’ll disproportionately affect the newsroom “as it’s the largest department by far by head count.”

Smaller papers are struggling more, including Times subsidiaries in Yakima and Walla Walla. Fisco said the company lost money in both markets for the first time in 2020.

Fisco said legislation is needed to help level the playing field with dominant platforms. A year ago, when the three largest digital ad companies posted 17% growth, The Times saw digital ads fall 20%, he said.

“We spend millions a year to publish valuable content that they leverage for financial gain at our cost,” he said.

Danielle Coffey, senior vice president of the News Media Alliance trade group, said ongoing challenges of the three “perfect publishers” with loyal audiences show “there’s a broken marketplace.”

“We have two dominant platforms that sit between us and our readers and extract the value of our content, and they systematically deliver it to readers,” she said.

Antitrust leaders in Congress told conference attendees they’re responding with legislation.

Sen. Klobuchar, a Minnesota Democrat and daughter of a Star-Tribune columnist, said the government should have acted sooner to address unfair competition so we wouldn’t be in a situation with “decimated” news organizations.

Klobuchar is proposing a suite of antitrust reforms, such as lowering the threshold for merger reviews.

She’s also sponsoring the Journalism Competition and Preservation Act, which would allow news organizations to collectively bargain with digital platforms.

The House sponsor, U.S. Rep. David Cicilline, delivered a recorded speech to the conference promising action.

“Americans have had enough,” the Rhode Island Democrat said. “By an overwhelming basis, Republicans and Democrats agree these companies have too much power and Congress must curb their dominance.”

Fisco said the bill is a step in the right direction but summed up a widespread concern:

“Frankly, I hope it isn’t too late.”