What's next for newspapers as COVID news cycle fades
The Press & Journal, a weekly paper covering Middletown, a small town near Pennsylvania's capital, folded in July 2020 because its ad revenue collapsed in the pandemic. Its publishers, Joe and Louise Sukle, decided there was no future for the paper, even after getting a $146,000 emergency small-business loan from the government and donations from the community while seeing its site traffic zoom up.
The town has lost a local news source that covered council meetings, school board meetings, the police and important projects in the area like a new train station.
“The thing that really pains us is there’s a vacuum now,” Joe Sukle said. “The people who suffer that is the public.”
The coronavirus pandemic, a high-stakes U.S. election and a racial reckoning expanded news audiences for many newspapers and TV news channels, making 2020 a blockbuster news year. But it was terrible for the newspaper industry's finances — and also for the public that relies on original reporting to keep it informed about local governments and communities. The overall contraction of the industry — now more than a decade old — is likely to continue in 2021.
Newspaper industry revenue sank 16% in 2020, to $20.2 billion, according to FTI Consulting, as pandemic shutdowns curtailed the economy and scrapped ad spending. The fact that it was also a banner year for digital subscriptions didn't help much, since those tend to bring in much less revenue than print. This year, the revenue decline will revert closer to the recent historical level, with a 2% drop this year, FTI predicts, as some ad spending comes back and digital subscription growth continues while print keeps fading.
Consolidation and cost cuts are now widespread, particularly now that financial firms like the hedge fund Alden Global...
