The news may be getting better for America’s newspaper business

WASHINGTON - Sometimes, the dark hour in America’s vast newspaper industry feels like a moment of regeneration.

Exhibit A: In Georgia, a 155-year-old newspaper with 60,000 subscribers is grasping for a new lease on life. The Atlanta Journal-Constitution believes it can pick up half a million new digital subscribers within the next three years, a bold gamble riding on an investment of US$100 million (S$136 million). 

The newspaper has drawn up expansive plans to add sections on politics, culture, cooking and sports. And it will hire 100 more journalists.

Exhibit B: The Winsted Citizen began life nine months ago as a print product in a small town in Connecticut, promising to tell local stories. “If it’s important to you, it’s important to us” is its motto. It is now casting for digital subscriptions, an interesting twist in an age where print newspapers routinely publish their own death notices.

Exhibit C: A pledge by some of the country’s biggest philanthropic organisations earlier in September to put in US$500 million to reverse the “dramatic decline in local news” by strengthening news infrastructure.

These are signs of hope in an industry struggling with mass closures, leaving communities unserved. 

There are sizeable gaps in newspaper coverage all over the American heartland, a study by Northwestern University’s Medill School of Journalism shows. These “news deserts”, as the study describes them, have left 70 million people living in more than 200 counties without a single local newspaper. 

Industry figures tell a dismal tale. Since 2005, the United States has lost more than a fourth of its newspapers and is projected to lose a third by 2025, the university’s The State of Local News 2022 says.  

The Covid-19 pandemic wreaked more havoc. It inflicted more than 360 casualties, leaving the country with 6,380 surviving papers, of which 1,230 are dailies and 5,150 weeklies.

Declining revenues – from over US$50 billion in 2005 to around US$20 billion today – have led to massive job cuts. Newsroom employment has fallen almost 60 per cent, with staff photographer jobs declining by 80 per cent.

Against that grim backdrop, the infusion of US$500 million over the next five years through the MacArthur Foundation-led Press Forward initiative has stirred some hope, however cautious.  

“Is half a billion dollars a big enough Band-Aid to cure what ails local news?” asked Ms Sophie Culpepper, a staff writer at Nieman Labs at Harvard University, in a piece that examined how the aid would percolate down to the many newsrooms in need of a lifeline. 

Mr Rick Edmonds at the Poynter Institute said: “It is a really substantial amount of money, and it’s well-timed.”

But he added that the gap in funding was still quite large.

Although this is the largest single philanthropic commitment to journalism, it does not go far enough. The Boston Consulting Group estimated in 2023 that it would take about US$1.75 billion to bail out local news.

However, it is not all gloom. Even after selling and shuttering more than 100 newspapers over the past few years, Gannett, the country’s largest newspaper chain, still owns 494 papers in 42 states. 

National newspapers such as The New York Times, The Washington Post and The Wall Street Journal are able to sustain themselves through subscriptions and cash infusions from billionaire investors.

But other big-city brands have enjoyed mixed success at best. Mr Patrick Soon-Shiong, the owner of the Los Angeles Times, for instance, said in 2019 that the newspaper would grow from 150,000 digital subscriptions to five million in five years.

Four years on, the paper has only 550,000 paying digital subscribers. But southern California’s largest newspaper continues to expand its footprint with more diverse audiences, targeting the growing Latin American community in the city.

There are other positive signs. Apart from the availability of funds, newspapers across the country are expected to benefit from the steadily improving economy. 

Newspapers are also getting better at understanding their audiences and at deploying technology to increase their appeal.

For instance, the Atlanta Journal-Constitution sees an opportunity in expanding beyond Atlanta to other cities in Georgia and the rest of the south-eastern US, while staying devoted to covering local or regional news.

For the Winsted Citizen, the raison d’etre came from Mr Ralph Nader, 88, the four-time presidential candidate and consumer activist. He said the news hole in his hometown needed to be fixed; the last local daily there folded in 2017. Besides, he said, he is convinced his neighbours there are sick of electronics and miss feeling the newsprint in their hands. 

A number of initiatives are under way to help the industry transition. The American Journalism Project is helping news outlets refine their business strategies; the National Trust for Local News helps non-profits acquire struggling news organisations to sustain them. Report for America, described by its founders as a “call to service for a new generation of journalists”, runs a public service journalism programme that places reporters in local newsrooms to report on under-covered issues and communities.

More controversially, half of all daily newspapers in the US are now owned by hedge funds or private equity firms, fundamentally altering the game. This new money is more focused on generating returns on investment than in expanding local news coverage.

But the problem is not merely the profit motive. The opposite, in fact. The original puzzle of how to keep newspapers thriving in the Information Age has not yet been solved. 

As a former editor of the Post, Mr Marty Baron, pointed out recently, the newspaper has to find ways to be commercially viable. 

“We need to figure out how to solve our own commercial problems. We can’t just be the damsel in distress all the time, saying, ‘Please help us, help us. We’re beautiful,’” Mr Baron, who has also been editor of The Boston Globe, said in an interview with Northwestern University’s Local News Initiative website.

Commercial success is only one part of the story. What no one disagrees with is that poor news availability is associated with a fall in civic participation and rise in corruption in both government and the private sector.

The sentiment has spurred lawmakers in several states to introduce Bills with provisions for measures like tax incentives for subscription to a local newspaper and tax breaks to newspaper organisations for hiring journalists.

A bipartisan Bill with similar proposals was introduced in the House of Representatives in July; it may have better luck in Congress than an earlier version that collapsed due to lack of support in 2021.

It could be the beginning of a rejuvenation from the ground up.