Bad News Bearers

Jeepers, I guess today is "Bad News for Newspapers" day, this time via the L.A. Times:

When Jeffrey Zalles needed a new cashier for his coin laundry in the South of Market district, his help-wanted ad in the San Francisco Chronicle brought just four responses.

So Zalles posted a notice on Craigslist, a San Francisco-based network of websites that specialize in classified advertising. His cyber-ad drew 400 applicants.

Zalles found his cashier and hasn't relied on the Chronicle since, advertising instead on the Internet and the city's array of free papers.

The venerable Chronicle is struggling, and defections by Zalles and other advertisers are a big reason. Classified ads are a big source of income for the Chronicle and the newspaper business as a whole, making up 27% of the industry's revenue, with 53% from other ads and 20% from people buying the paper.
What's more, the Chronicle's circulation is plunging. The paper reported last month that sales fell 16% during the six-month period ended in September — by far the biggest drop among the nation's 20 largest newspapers. Chronicle executives said much of the decline was caused by their decision to stop offering steep subscription discounts.

The Chronicle's woes are being closely watched around the country as the newspaper finds itself on the front lines of the battle between old and new media. As more consumers get their news from electronic sources and advertising follows them, analysts warn that newspapers elsewhere — already losing an average of more than 2% of their subscribers yearly — might join the Chronicle in a steepening fall.

Comments economist Mark Thoma:

It's hard to argue that delivering a freshly printed newspaper to the homes of subscribers, which requires a small army of delivery staff, a massive daily printing operation, and so on, is more efficient than sending stories electronically by posting them on websites. And once you start writing with hyperlinks and other enhancements available only electronically, you miss them when writing on paper. I'm sure everyone is aware of the advantages available with online news stories, and some disadvantages as well such as sometimes posting stories before they are fully vetted in the race to go online first.

Still, there's something about a newspaper and I will miss the local paper once it's gone. Finding a business model that works for online news sites has been a challenge, so perhaps there's some life left in newspapers, but it's hard to imagine them surviving long-term:

It's interesting how almost every defense of the printed newspaper I've read is almost entirely due to sentiment. It's my suspicion that sentiment may go a long way toward keeping printed newspapers around, but as more and more people come of age who do not have that attachment to printed papers, they will become less and less viable.