"Our citizens may be deceived for a while, and have been deceived; but as long as the presses can be protected, we may trust to them for light." -- Thomas Jefferson
It's not unusual for industries to face unprecedented financial pressures, a declining reach of product and massive consolidation in today's global marketplace. But a variety of observers are sounding an alarm about the radical changes occurring in one industry -- journalism, and newspapers in particular.
These critics worry about the cost to society of the diminishing number of voices and declining quality of journalism, citing its historic role in sustaining democracy.
Professor John McManus of San Jose State University believes newspapers are the "nervous system of democracy": The decline of newspapers and news coverage is a civic version of the debilitating disease ALS, leading to a paralyzed democracy.
Peter Phillips of Sonoma State University agrees. "Media consolidation is creating a new form of censorship in the United States and undermining democracy in the process,"
When it comes to responding to the issue, however, the ideas are few and far between.
Stanford University Professor Ted Glasser said it's time to consider entirely new models in the media business. Instead of trying to accept the realities of the marketplace, he says the industry needs to ask a different question: What kind of journalism does society need and what kind of conditions do media companies need to sustain it?
Ground zero: the Bay Area
While the merger trend stretches nationwide, the Bay Area is ground zero for newspaper consolidation and the fears it has generated.
The local media landscape has changed fundamentally in just the last couple of years -- and the new dominant player on the scene is Dean Singleton's MediaNews. Only two years ago the three major daily papers in the Bay Area were the San Francisco Chronicle, San Jose Mercury News and Contra Costa Times (the Chron being owned by the Hearst Corporation, the latter two owned by Knight Ridder).
The Denver-based MediaNews owned the Oakland Tribune and a number of smaller papers. Bay Area newspapers competed with each other for news coverage and advertising. Though there weren't as many independent voices as 20 or 30 years ago, there was still vigorous competition, critics note.
Then in 2006, Knight Ridder, under pressure from stockholders, was sold -- first to the McClatchy Co. and then to MediaNews. The deal resulted in almost every daily newspaper in the Bay Area -- including the San Jose Mercury News -- being owned by MediaNews. And that doesn't include the weeklies it has acquired, which used to operate as independent voices in the community.
MediaNews owns at least 29 daily papers in Northern California and nine in Southern California.
Nationally, MediaNews owns 57 daily newspapers and some 120 non-daily publications in 13 states and has become the fourth largest newspaper company in the country.
On July 28, MediaNews announced a consolidation of the news operations of all its East Bay papers (as well as the San Mateo County Times and a number of weekly papers) along with additional staff cuts. Newspaper Guild representatives interpreted the consolidation as a union-busting move by mixing Guild-member staffs with non-Guild operations.
MediaNews' East Bay Publisher John Armstrong said the consolidation will "eliminate wasteful redundancies, streamline management and redirect staff and resources to our interactive services and other priorities, such as watchdog journalism."
But John Bowman, former executive editor of the San Mateo County Times, had a different take: "They're way past the point of diminishing returns, of penny-wise and pound-foolish. ... Thin staffs provide less volume of news, less investigative and less enterprise stories. ... Copy desks are so thinly staffed that they are making an incredible number of errors. These errors are in the headlines and [photo captions so they are glaring. They are the kind of errors that destroy our credibility."
Faced with the prospect of deteriorating news quality, Bowman submitted his resignation after a 31-year career in the news business.
The one remaining major Bay Area paper not a part of MediaNews is the Chronicle. However, the Hearst Corporation contributed $300 million to help finance the Knight Ridder/MediaNews deal (via middleman McClatchy Company) and in return received a 30 percent interest in non-Bay Area holdings of MediaNews.
Hearst and MediaNews' consolidation and cooperation efforts were put on hold pending an antitrust lawsuit filed by former San Francisco political consultant Clint Reilly. The suit, which challenged the unprecedented consolidation, was settled shortly before trial last spring.
And on Oct. 25, the U.S. Department of Justice dropped its investigation of the alliance after concluding it would not induce the companies to compete "less vigorously" in the Bay Area.
Law professor Stephen Barnett of the University of California, Berkeley, said it's "shameful that the U.S. Justice Department has walked away" from applying antitrust laws to the Bay Area consolidation.
There are many other cities with examples of newspaper consolidation, but Barnett said he can't think of any other area of similar size where the consolidation extends so far beyond the central city through the suburbs.
"Enforcement of antitrust laws is generally weak, and it has been super weak for newspapers because of their political clout," he said.
And then there was one ...
Neil Henry, a journalism professor at U.C. Berkeley and author of "American Carnival: Journalism under Siege in an Age of New Media," said the Bay Area has been affect by media consolidation more than most areas.
When the area had a dozen independently owned papers covering a major story, there might be a dozen perspectives, he noted. NowMediaNews needs only need one reporter covering the story.
Henry also asserted that when fewer and fewer organizations own and deliver the news, it can't help but be harmful for democracy.
Henry covered Africa for the Washington Post between 1989 and 1993 using telexes and a 15mm camera. In those days all major television networks had bureaus in Africa, as did major newspapers and news services. Today there is no American television or cable network based on the continent. Coverage is limited to the New York Times, Washington Post, LA Times and a handful of news services. Henry pointed out a paradox in having wonderful new tools and a dazzling array of information available on the Internet, but dwindling numbers of people contributing the substance of news -- journalists.
Closer to home the loss of reporters is a significant problem, according to Harry Press of Palo Alto, a longtime journalist: former city editor of the San Francisco News, former deputy director of the Knight Fellowships for Journalists program at Stanford and founding editor of the Stanford Observer (now Stanford Magazine).
"There's no variety, there's no differentiation. ... When all papers are owned by one person, there's just one voice," Press lamented of the diminishing media outlets.
Stanford's Glasser said the Bay Area's media consolidation is emblematic of a larger problem and leads to three things: fewer journalists; homogenization of coverage (with the same story appearing in multiple newspapers); and a lack of coverage of journalism as an institution.
Glasser said the picture is not improving. The further the industry travels down this path the more the story needs to be covered -- and the less it is.
Show me the money
While there has been minimal local coverage of the consolidation, daily newspapers in general have been tuned in to the story of their own financial plight and have covered it as a major story in recent years.
Daily newspaper readership is down because younger adults are increasingly getting their information online or from sources other than newspapers, according to industry reports. The circulation of daily newspapers is dropping across the country, down more than 11 percent from 1990 to 2005.
The local dailies are prime examples. The San Francisco Chronicle topped the list of 20 major dailies in percentage circulation decline, dropping 15 percent between March 2005 and March 2006, according to Editor and Publisher, the industry magazine. The next largest decline was The Boston Globe at 8.5 percent.
The Mercury News daily circulation declined from 263,000 to 236,000 between 2004 and 2006, according to the Audit Bureau of Circulations.
Jim Bettinger, director of the Knight Fellowship Program at Stanford, noted that it's hard to differentiate the effects of the consolidations from changes resulting from shrinking revenues. But with fewer reporters and editors less news reaches readers, he said.
"I don't think anyone could argue that people in the Midpeninsula are getting the quantity and therefore the quality of coverage of this area they got two to three years ago," Bettinger said.
Industry experts agree that Craigslist and other online competitors have drastically cut classified-advertising revenues, which had been a major profit center for most daily newspapers. Much other advertising is also shrinking or moving online.
The value of daily newspapers as businesses has also declined. The stock of the McClatchy Company, owner of the Sacramento, Fresno and Modesto Bees and other media holdings across the country, was recently downgraded to junk-bond status by Standard & Poor's ratings service.
Newspapers have migrated online, creating Web sites that offer up-to-the-minute stories, photos and video and an opportunity for readers to comment, industry watchers note. But although Web sites are highly visited and provide content fodder for services such as Google News, media heads are still trying to figure out how to turn the sites into profit generators.
As readers slip away from print editions, advertising revenues drop -- newspapers' main source of money. In response, newspapers nationally have been laying off staff, making it even harder for them to produce top-quality newspapers and Web sites, observers note.
But MediaNews' Singleton stands out as a voice of optimism in an industry packed with doomsayers. Singleton was quoted in his own Denver Post Aug. 14 as saying that while advertising dollars may be falling away from large metropolitan dailies, newspapers with circulations between 20,000 and 250,000 are thriving.
His perhaps overly rosy big-picture view isn't echoed locally. A July 20 memo linked from the San Francisco Peninsula Press Club Web site, written by one of his top executives, John Armstrong, tells another story. Revenue fell $21.3 million, or 8 percent from the prior year, and operating profit dropped $4.5 million, Armstrong reported of financial results for the Bay Area News Group--East Bay. Three-fourths of the decline came in advertising sales, he said.
Mercury News executives did not return phone calls requesting comment on the consolidation trend.
Where daily newspaper journalism is headed financially is unclear. Reports appear almost daily regarding cutbacks in newsroom staffs across the country. Major papers have cut back foreign bureaus as well as cutting in their backyards.
The San Jose Mercury News has cut its newsroom staff by about half over the last seven years. The San Francisco Chronicle announced on May 19 one of the biggest cuts of any newspaper in the country. It cut about 25 percent of its newsroom staff by the end of the summer -- 100 positions from a staff of 400. The Chronicle has a poignant tribute to departed staffers called "Colleagues Remembered" on its Web site. Publisher Frank Vega said revenue from advertising and other sources wasn't keeping pace with the cost of running the paper.
An example of what's happening in the industry is contained in a statement from Publisher David Hiller of the Los Angeles Times, the daily paper generally regarded as best in the West. Hiller announced in April that the Times would offer voluntary buyouts in hopes of cutting its staff of 2,625 by up to 150 employees. Revenue for the Times and related units dropped 4 percent in the first quarter, compared to the previous year, he said.
"The fact is we have to take actions to keep staffing in line with the revenue picture, which currently is falling in the core print business. ... Up to 70 jobs could be cut from the newspaper's news operations, which would bring the newsroom staff to roughly 850. The Times news operation employed about 1,200 when the paper was purchased by Tribune Co. of Chicago in 2000."
In May the Times announced an additional cut of 57 more newsroom positions. Two consecutive Times editors, Dean Baquet and John Carroll, resigned rather than preside over additional staff cuts.
A game of monopoly
San Jose State's John McManus, who has been the primary force behind "Grade the News," a project focused on examining the quality of news delivered by Bay Area media, believes that as newspapers decline, society suffers a loss of civic vitality. Government officials and staff who had been accustomed to reporters hanging around begin to cut corners because they operate in the dark. He said the public is not upset because people are not aware of the drastic changes underway.
What's happening, McManus pointed out, is that investigative and enterprise reporting suffers and news becomes driven more by public-relations and entertainment. As an example, he examined the Mercury's coverage of the 2005 "finger in the bowl of chili" story and says it ran for 33 days from the day it broke to the day Anna Ayala was arrested. It was in the paper every day and on the front page 11 times, he noted. Iraq made page one once, and that was a human-interest story.
McManus is author of the book, "Market-Driven Journalism: Let the Citizen Beware?" He argued that the formerly revered practice of news reporting for the public interest is being superseded by the corporate-driven "commodification" of news, treating it like any other commodity or product. He was an expert witness in the Reilly lawsuit challenging the McClatchy-Hearst-MediaNews deal.
He said MediaNews argued to the federal Justice Department that it shouldn't stop the acquisition because news is no longer a monopoly of newspapers. Television, radio and the Internet provide a wealth of different sources for news, according to MediaNews. While McManus said this argument has surface validity, McManus's response to the question of diverse voices is: "Name some." With minor exceptions, no solely Internet-based sources are really reporting on local communities, he said.
Phillips of Sonoma State and director of Project Censored, agreed.
"Media consolidation is creating a new form of censorship in the United States and undermining democracy in the process."
Fewer than 10 major media corporations now dominate the U.S. news and information systems, he said. He added that 98 percent of all cities have only one daily newspaper and these are increasingly controlled by huge chains.
"Censorship in the United States today is seldom deliberate but rather comes under the heading of lost opportunities," Phillips said. "Mega-merged corporate media are predominately interested in the entertainment value of news and the maintenance of high audience viewing/reading levels that equate to profitable advertising sales.
"Non-sexy or complex stories tend to receive little attention within these corporate media systems."
Lowell Bergman, a Pulitzer Prize-winning investigative reporter, has a more critical perspective on the current state of Bay Area journalism. Now a U.C. Berkeley professor, Bergman has barbed comments about a variety of local media operations and says the news-gathering public-interest function is in jeopardy:
"The people who are running the Chronicle have lost sight of why they're running a newspaper," he said.
Dean Singleton is "into making money. He's like Murdoch."
"Most local (television) stations in San Francisco are making 30 percent profits."
And he takes a jab at the feds: The Federal Communications Commission "now says that's what's in the public interest is whatever the public is interested in."
The future is unwritten
What does the future hold? McManus said one positive aspect is that the value and importance of news continues to increase in a time of increasing complexity and sweeping changes.
Society, the environment, the economy and institutions are undergoing major changes due to new technologies and other forces, he noted. Knowledge remains a key to power, and its shelf life grows ever shorter. And with the global economy and global wars, people need information from even more distant places, with more frequent updates.
McManus believes that in five to 10 years, as the news industry transitions to a more decentralized system of news gathering information will become increasingly accessible on a niche basis with micro-payments by the story or through specialized subscriptions.
Bergman believes that "sooner or later" a Bay Area Web site will emerge "where people go to find out what's going on. Something will happen, and there is no place riper than this area because it's been underserved [by journalism historically."
Dan Fost, former Chronicle media columnist and Marin Independent Journal reporter, points to online magazines Salon and Slate (now owned by the Washington Post) as evidence that quality journalism can happen online.
But he sees a conundrum. The press is protected as an institution in the U.S Constitution but is run largely as a for-profit enterprise whose first interest is to make a buck for shareholders.
Fost would like to see the nonprofit world get involved in journalism and suggested Mother Jones and the Center for Investigative Reporting in the Bay Area as examples. The model is not perfect: There's a risk of corporate sponsorships and political attacks from the right (which public broadcasting has experienced at a national level).
He hopes the Chronicle can hold on long enough to make a mark online but is concerned about a potential spiral of cutting content (the substance of its news and features) leading to fewer readers leading to fewer ads, leading to more content-cutting.
U.C. Berkeley's Henry also suggested that the profit model for delivering news is out of date. He pointed to the publicly funded BBC as a successful, different approach.
Glasser, however, said journalists are reluctant to talk about that possibility because of fear of government control.
"It's a real fear, but I don't see the state as an enemy. National Public Radio provides the best radio journalism, and we forget how well [government funding has worked there."
The situation demands a better, more imaginative vision than we have had, Glasser said. Journalists need to look beyond models of market-based journalism that have defined the industry for the past 200 years. Journalism should be defined as other public resources are, such as schools, museums or libraries. Librarians are allowed to make independent judgments about what books to put in a library, for example, he said.
It has everything to do with the news agenda and the mosaic needed in a multicultural society, Glasser said. People have to stop talking about accepting the realities of the marketplace and instead take a serious look at alternatives to market-based journalism.
Thomas Jefferson's concept of democracy was one in which a free and diverse press could write whatever it chose. While there would be abuses, exaggerations and inaccuracies, the idea was that truth would ultimately emerge from an open marketplace of ideas. Newsbills and various forms of print from 200 years ago were more about the content -- about conveying and advocating ideas -- than about generating profits for enormous companies.
Today that model has been turned on its head.
Just as the media has evolved -- for better or worse -- over the centuries, that progression will continue. But, critics say, one thing is apparent, whatever form it will eventually take: For serious journalism to triumph, consumers must demand quality and be willing to pay for it.