San Francisco Chronicle May Shut Down
Closing Could Leave the City Without a Major Newspaper
Feb 26, 2009
Another indication of the dire straits of newspaper publishing in the United States is the announcement by the Hearst Corporation, parent company of the San Francisco Chronicle, that told employees that it must reduce the number of employees shortly or it will sell or close down the publication. (Reuters 02/24/2009)
Statement by Chronicle's Owners
The Hearst Corporation issued a statement on March 24, 2009, stating that it had suffered losses every year since 2001 and last year alone lost $50,000 million with projections that it will be worse in 2009 if some changes were not made.
The Corporation called on union members that represents Chronicle employees to work together to make the necessary cuts during the current recession. This would mean enough staff cuts among the 1000 employees to make up for the current losses.
Options Available to Chronicle Management
If enough money is not saved by cuts in staff, the only alternative the Hearst Corporation may have is to sell out to Denver-based MediaNews, owner of the Mercury News and all the other major daily newspapers in the Bay area. However, this could leave them open to an antitrust legal battle. The owners could argue that there are no other buyers interested in buying the Chronicle and it would otherwise close down permanently.
A Time of Last Resort for the Chronicle
In the past the Chronicle has slashed staff, raised newsstand and home delivery prices and made plans to outsource printing operations, eliminating all of its production past. However other newspapers have tried to survive by doing the same things plus combining sections asking for pay concessions on pay and health insurance and some even dropping print publications all together.
Chronicle Joins List of Newspapers on the Edge
The Hearst announcement joins that of E.W. Scripps Co.' Rocky Mountain News in Denver and the Gannett Co's Tucson Citizen who have said they would close if they do not find buyers. Even the New York Times could declare bankruptcy in the near future.
The Outlook for Print Newspaper
The outlook for print newspapers in general continues to deteriorate as readers look to the Internet for news, especially those wanting to keep up with events as they happen instead of waiting to look for them in print the next day. Even favorite columnists have their own home pages on the Web where readers can even put comments in response to what has been written. For cities and towns with one print newspaper, it may be the end of a era.
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