Philly Newspapers Under Knight-Ridder: By the Numbers
Posted by chanders on August 19, 2008
UPDATE (8/21/2008): I’ve added a second post, “Philly Newspapers Under Knight-Ridder: Beyond the Numbers,” that tries to make the case for the relationship between the Internet, public chain ownership, and the current state of journalism. Prime evidence? Philly.com’s series, “Blackhawk Down,” published online in 1997. The prime culprit? The Real Cities initiative.
I’m starting the next chapter in my dissertation, the one that’s mostly economic. One of my major findings while I was at the Inquirer, Daily News, and Philly.com relates to the “precarity” of most of current journalistic work– what Wikipedia defines as “a condition of existence without predictability or security, affecting material or psychological welfare. The term has been specifically applied to either intermittent work or, more generally, a confluence of intermittent work and precarious existence.” Many employees, both at the Philadelphia newspapers but also obviously bloggers and freelance writers as well, expressed feelings like: how empty their newsrooms were, fears that they could be laid off at any moment, worries that “some guy in Bangkok could do the job that I do.”
One of the things I’m trying to document early on is the actual economic state of the newspaper industry in Philadelphia. The above graphic represents a polynomial trend line of Philly newspaper revenues, circulation, and employment figures, from 1984 until 2005/6 (when the papers were bought by Brian Tierney and Philadelphia Media Holdings). As Microsoft puts it, “a polynomial trend line is a curved line that is used when data fluctuates. It is useful, for example, for analyzing gains and losses over a large data set.”
The above data– which is not that easy to come by– is obtained from two places. The circulation and revenue figures are part of a dataset compiled by researchers at the Columbia Institute for Tele-Information (CITI) for an upcoming book by Prof. Eli Noam, Media Ownership and Concentration in America. The employment numbers are very rough estimates compiled through publicly reported information in major newspapers; for example, when Knight-Ridder cut newspaper staff by 10%. For at least a decade, between 1984 and 1995, I have very few numbers. These numbers are ESTIMATES, at best. They might, in fact, be totally wrong. I want to emphasize that no one at Knight-Ridder or PMH has given me access to any of this data … it’s entirely obtained from outside sources. That’s why I represented the numbers as a trend line, rather than as a strict year-by-year graph. (I obviously scaled the data so it could all be one one graph. A circulation of 400,000 equals, on this chart, a staff of 400). I also want to note that the data only covers Philly newspapers under Knight-Ridder, not under it’s current ownership (though there’s plenty of bad news there, too).
That said, the numbers are obtained from documentary sources, and I’ll stand behind them until I hear otherwise. What does this show? A few broad trends are pretty obvious. First, employment at the Inquirer boomed throughout the 1980s and 1990s (hard on the death of the afternoon daily the Philadelphia Bulletin) even as circulation numbers began a slow decline. Then, in 2000, employment began to plummet (in 8 years, the newsroom at the Inky was half the size it was in 2000). Circulation and employment numbers at the Daily News, on the other hand, saw more of a gradual but steady decrease throught this time period, until they stabilized in 2005/6.
Revenues, on the other hand, tell a different story. It’s pretty clear that, throughout the course of this dataset, profit margins at PNI (the name for the Philly subdivision under Knight-Ridder) were anywhere between 9% (in 1995) and as high as the upper teens to low 20%’s by the early 2000’s. So … even while circulation and staff were dropping, and even as the challenge posed by the world wide web loomed on the horizon, profits got bigger and bigger. This, to me, is the real tragedy of public chain ownership of local newspapers in the 1990’s. Not the decline in journalistic quality, which was arguably real (to a degree) or the effects of media concentration (whose ultimate effects are still unclear), but a failure to plan ahead and prepare for a Internet future that a lot of people knew was coming. They were so focused on the quarterly bottom line that they failed to realize that the long-term bottom line was where they were really at risk. The choice wouldn’t be between 9% and 29% proift margins, but would be between profits and no profits at all.