Sitting shiva for dead trees

2006 was the year when the newspaper industry finally realized it was f’ed. Today’s news of the weak-kneed offers for Tribune Company are further evidence. And this is just the start. Radio has been headed in the same direction. I say that local TV station groups are next. Networks, cable MSOs, and advertising agencies may not follow the same downward path, but they are in for more upheaval than they know. Consider Tribune and Knight Ridder the cash cows in the coal mine.

  • Might as well add book publishers to your list, Jeff. Their individual circumstances differ, but as an industry, they’re on the “f’ed” list, even if the news isn’t out.

    This morning, Michael Cader of PublishersMarketplace wrote in his newsletter (subscription required, so I can’t link):

    “The largest bankruptcy in publishing history threatens the existence of 150 publishers and takes a big chunk out of the 2006 profits of everyone else and it barely rates a mention in the national media. But Harper officially closes an imprint [ReganBooks] that we all knew was dead already [after the O.J. Simpson debacle], lays off 10 people, and it’s international news.”

    The bankruptcy Cader is referring to involves Publishers Group West, which covered sales and distribution for 150 independent publishers (including some name brands, like Grove, for example, and Cader’s too). AMS (PGW’s parent company) owes $170 million to various creditors, including publishers large and small.

    Also: Bertelsmann, which owns Random House (the largest publisher in the U.S., where book sales have been “flat” every year in recent memory), is under intense financial pressure.

    Finally: today there are published rumors that there may be a LBO of Pearson (the world’s largest textbook publisher) by a private equity firm.

    So: not a pretty picture.

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