* I’m getting a real fear deep down that the Sun-Times won’t survive unless something drastic changes very soon…
Sun-Times Media Group Inc. said it lost $168.8 million in its third quarter as revenue sank amid a weak economy.
Ad sales in Chicago dropped 19% in the quarter, and likely won’t begin to increase again until 2010, CEO Cyrus Freidheim said in a letter to investors that was released along with its earnings report Thursday. The company plans to cut $45 million to $55 million in expenses over the next nine months to survive in the meantime.
Newspapers are struggling amid the worst advertising environment in years, and the operator of the Chicago Sun-Times and 70 other community newspapers is no exception. Its latest cost-cutting plan comes on top of a $50 million expense reduction that came in the first half of 2008. All told, the company will have trimmed its costs by 30% by the middle of next year, Mr. Freidheim wrote.
“In view of the worsening market conditions, the company is taking even more aggressive actions to reduce costs,” he wrote. “Our organization understands the severity of the situation and the need for urgent action.”
The latest cost-cutting plan will include “outsourcing, downsizing and the elimination of poorly performing products,” he wrote. No further details were available.
There was a time, not long ago, when I thought about putting together some financing to buy the chain. It wouldn’t cost much. The problems are many, however. The structural deficit is crazy scary. Uncollectable ad revenues are huge. You’d basically have to declare bankruptcy, break the union, strip the pensions, tell the banks to kiss off and try to start all over. But even then, it’s an iffy proposition.
…Adding… To be clear to my fellow union members, the top management would have to be swept out as well, along with their salaries. Everybody just take a breath, OK?
* These may be good intentions, but the moves could spell the death knell of even more newspapers…
President-elect Barack Obama will try to use his office to hinder media concentration and to increase local TV news coverage, objectives that have stirred resistance from industry groups.
The Illinois Democrat, who will succeed George W. Bush on Jan. 20, “is going to push for a more open, more diverse media,'’ Gloria Tristani, a former Democratic member of the Federal Communications Commission, said in an interview.
It’s just not right that the Tribune can own TV and radio stations and yet no TV station can buy the Sun-Times. We may need more consolidation between broadcast and print to save both industries. Print, except for a few papers, won’t last on its own.
* This may look better than it really is…
Don’t look now, but NBC is rolling out some sharp-looking local news sites for its owned-and-operated stations in New York, Washington, Chicago, Philadelphia, Los Angeles and elsewhere.
Using URLs like “NBCWashington.com” and the tagline “Locals Only,” these are quantum leaps over the usual crappy local TV news sites for a very simple reason: They’re actually focused on local news, and eschew the usual mindless over-promotion of the local NBC news team and primetime schedule. They’re also not limited to NBC-produced content–the sites promise to aggregate content from other local sources, as well, a la the very smart Examiner.com model.
I love the look of Channel 5’s new site. The parent company even offered me a spot over there, but I politely turned them down for various reasons. Right now, the site is more concept than execution, but it should improve over time.
* Meanwhile, the Tribune Co. needs to sell the Cubs to pay off its ginormous debt, but that’s in trouble now as well…
Tribune Co. may end up holding 50 percent or more of its storied Chicago Cubs baseball franchise as the credit crunch stalled sales talks, the Wall Street Journal said.
In recent weeks, an early plan to sell a 95 percent stake has fallen to about half as suitors’ ability to buy the team and its stadium on Chicago’s North Side waned, the paper said citing two people involved in the negotiations.
On Thursday, bidders were preparing to receive a request to submit new purchase proposals with financing details, those people told the paper.
Tribune is selling assets to help pay down debt, which stood at $12.5 billion at the end of the second quarter. Declines in readership and advertising dollars at such newspapers as the Chicago Tribune and Los Angeles Times have added to the pressure on the company to secure funds to avoid default.
* Obama campaign’s text/mobile effort: A model for newsrooms?