A Deeper Dive Into What Really Damaged Newspapers - A Media Operator

rapidly declining circulation, fewer pages per newspaper and less overall revenue has meant fewer journalists. Indeed, there are now far fewer people working for American newspaper publishers than at any point since WW2

But despite all of that, the fundamental reason that local news has struggled is because the businesses are just bad. They have screwed up cost structures that make it incredibly difficult to be profitable.

There are lots of things going on here, but I would start with the top line: advertising share of GDP started sliding immediately after the Dotcom bubble, had a major step down in the financial crisis and has been suspiciously flat ever since. That decline was very obviously concentrated in print but actually affected TV and radio as well. We think... See more

US advertising has shrunk by a third as a share of GDP. This is some combination of internet advertising being vastly cheaper and vastly more efficient on one hand, and on the other a lot of recategorisation. If a car dealer used to buy a 20 page ad insert in their local paper, but now pays for one Google search ad (and how many people bid against ... See more