Bacon's Rebellion

Democracy Thrives in Sunlight

Who Will Gather the News: Media General on Credit Watch

—

by

James A. Bacon
in

Media General Inc., owner of the Richmond Times-Dispatch and newspapers in Charlottesville, Lynchburg, Danville, Bristol and other Virginia communities, has been placed on S&P credit watch following an announcement that it would post a 1Q loss this year. Writes the Associated Press:

The ratings agency said it would keep the newspaper and TV broadcast company credit rating at ‘BBB-‘ shortly after the company lowered its guidance for the first-quarter to a loss of 26 cents to 30 cents per share. Analysts polled by Thomson Financial had been looking for a profit of 20 cents per share.

Revenues at Media General’s broadcast division got hammered the worse, suffering a 27.4 percent decline in revenues. I don’t spend much time watching local television news, so cutbacks in the coverage of murders, traffic accidents and thunderstorms doesn’t particularly distress me. But revenues continue to erode — 4.2 percent — in the publishing division. That’s where the serious news gathering takes place.

It can’t be much fun working for Media General right now. Said CEO Marshall N. Morton in a prepared statement: “We have implemented an aggressive plan to align our cost structure with the revenue environment we are experiencing. Our goal is to restore profit-performance to our original expectations for the year.” Translation: More budget cuts. Newsrooms will not escape the budgetary axe.

There’s not much chance that the Interactive Media Division will ride to the rescue. Revenues did increase 28.6 percent, but that was on a tiny revenue base. Essentially, IMD is a parasite. The vast bulk of its content is generated by broadcast and print. If the traditional media can’t produce as much content, IMD lacks the resources to make up the difference.

As much as I tout the Internet and blogosphere, I take no joy in this. Many of my friends work for Media General. I’m planning to get a pension one day from Media General. And I have yet to see signs of an Internet business model that can come close to delivering the content that we take forgranted from the Mainstream Media. I have my quarrels with MSM reporting, but I hate to see newspapers wither away.

Share this article

ADVERTISEMENT

(comments below)

ADVERTISEMENT

(comments below)

Comments

11 responses to “Who Will Gather the News: Media General on Credit Watch”

  1. Reid Greenmun Avatar
    Reid Greenmun

    Print media = Buggy Whips.

    Shift to a new medium for using realtime technology to communicate news – or die.

    Natural selection in progress.

  2. Anonymous Avatar
    Anonymous

    One of the more disgusting things about this is that guess who has so far failed to report this to the reading public? The Richmond Times-Dispatch, of course!

  3. Anonymous Avatar
    Anonymous

    Classified Ad revenue decreased….

    Thank-you Craigslist!!!

    Moral of the story: Adapt or get run over.

  4. Alice Avatar
    Alice

    somehow this does not surprise me

  5. Anonymous Avatar
    Anonymous

    At best half the houses in my upper middle class neighborhood even take the paper, and my next door neighbor often leaves them in the drive for two days before picking them up. I’ve had the daily newspaper habit since childhood but that is what it is — a habit, and most seem to live fine getting their news from TV or getting no news whatsoever (no wonder they buy into the campaign TV ads).

    My understanding is that Mediocrity General is really not worse off than other chains. I wondered from the beginning why they were all giving me free access to their content on the web. They should be paid by Internet outlets the way recording artists are paid by radio stations, through some kind of coop. It works for Lexis…make me pay that kind of fee, and if it is the only way to get the Post or NYT on line, I will pay it.

    But that won’t change the legions of young people, 30 and under, who never read a damn thing.

  6. Reid Greenmun Avatar
    Reid Greenmun

    There are more than enough 30 and UP folks that don’t read either.

  7. Larry Gross Avatar
    Larry Gross

    hmmm… is this about who reads or not or how money is made peddling the news?

    I guess there are a lot of dimensions to the issue.

    I see where GOOGLE is now experimenting with Ads that only charge if specific actions are actually taken as a result of reading the Ad.

    Buying, of course, but other actions.. like signing up for a newsletter or using a coupon, etc.

    Imagine that…

    But I think how all of this plays out in still way downstream… and still evolving and volatile, and yes.. there is no question that the current News business model is not going to remain as is.

    I believe that we are seeing changes more profound than the industrial revolution – changes that we don’t even understand – as with the fear and loathing associated it the demise of many of our favorite ways of getting “news”.

    I can say this.

    Having had the direct pleasure of observing an event and then seeing it reported in the news – so very differently than what I saw at the event and done so by a “reputable” reporter with a “reputable” paper has made me wonder about other reporting that I read.

    I’ve now taken the tact of requiring 3 or more similiar reports of something before I believe I have an accurate picture of what is being reported.

    and that goes for ANY news source – no matter how big and well-known they are.

  8. TNM Avatar
    TNM

    The crowd of newspapers, at least in our Loudoun neck of the woods, is simply unimaginative and uninspired when it comes to producing new and interesting content, surfacing budding reporters and contributors, and providing a unique, multi-media experience for those of us who sometimes can’t get the the physical copy (and enjoy leafing through 30 pages of ads), but do have unlimited Internet access.

  9. Anonymous Avatar
    Anonymous

    The TD deserves to go under-

    Case in point- there’s been absolutely no coverage of the Richmond Green Party’s contest to find a city in the country with a more regressive minimum water rate than Richmond (by the way, Jim, still hoping to see something here.). So far Richmond still reigns. What’s up with that?

    Instead, what ‘s on the front page? Trani’s ego trip about replacing the Coliseum. Never mind the craziness with the VaPAF and the Carpenter Center, never mind that Richmond schools, jail, and transportation are in need, VCU’s president wants a better place to see Billy Joel and his basketball team (no offense to this year’s Rams, who played their heart out).

    Disgusting. That’s not reporting, that’s kotowing to a bunch of corporate fascists who should be getting their asses kicked by a real media.

  10. Groveton Avatar
    Groveton

    These are the same guys who sold their cable TV monopoly in Fairfax County to Cox Communications?

    Then they kept their print media businesses?

    Their Internet Media Business, in 2007, is tiny? Fast growing but tiny? In 2007?

    Is there a corporate Darwin Award?

    I agree with Jim Bacon that’s it’s sad to see companies fail and people lose jobs. But that’s our capitalist system. In fact, it’s the world’s capitalist system.

    And for every Virginian trying to clutch the past with out dated philosophies and antique ideas there are 10 Indians and 10 Chinese willing to do whatever it takes to get the jobs in the global market.

    Evolve or go extinct.

    True for Media General.

    True for Virginia.

    True for the Unites States.

    High growth localities subsidizing their low growth counterparts?

    Media General focused on yesterday’s businesses instead of today’s?

    If we keep doing these things we’d better make a few changes:

    1. Teach Hindi and Tamil in high school.

    2. Make Mandarin a second language in the state.

    Xie xie,

    Zai Jian,

    Groveton.

  11. Anonymous Avatar
    Anonymous

    Unfortunately, Richmond citizens are being left in the dark, while other places continue to progress…

    http://gigaom.com/2007/03/26/sprints-lil-wimax-details/

Leave a Reply

Read More