The Claw

Half a century ago, rough and ready U.S. journalism boiled with such competition that Bostonians could take their daily pick of twelve daily English-language papers, Chicagoans of ten, New Yorkers of 20. By 1916, the alltime peak year, no less than 2,461 dailies were in business. By last week, when the American Newspaper Publishers Association met for its annual convention in New York, the total number of U.S. dailies had dropped to about 1,750. And in only 76 U.S. communities were there dailies in competition.

What has happened to the U.S. daily was a top subject at the A.N.P.A. convention. The general answer was easily come by: in the postwar period newspaper profits, caught in a narrowing gap between out-of-this-world costs and this-worldly revenue increases, have gone down by as much as 50%, thereby driving scores of papers out of competitive existence.

Barely Black. Newsprint, which can account for 50% of a paper's budget, has soared from $41 a ton in 1933 to $135. The Linotype machine that sold for $8,000 twenty years ago costs $20,000 today. Technological gains in efficiency are largely neutralized by the fact that powerful shop unions prevent management from cutting payrolls, even though only half as many men may actually be needed to tend the new equipment. Union "make-work" practices such as "bogus"--the needless resetting of ads originally received in mat or plate form--waste millions of dollars a year. And labor costs have maintained a consistent spiral: in New York a Linotypist's wage has climbed from $77.70 in 1945 to $128 a week--and the International Typographical Union is currently demanding $30 a week more.

Even dailies of medium circulation, least pinched by the cost-income claw, are finding it increasingly tough to stay in the black ink. In a study of a "typical" daily of 50,000 circulation. Editor & Publisher found revenue up 25.61% in the last decade, costs up 39.57%--and net profit down 58.24% (see chart).

Reducing Diet. To stay afloat, newspapers have tried everything from diversification (the Charlotte Observer turned a tidy profit last year by leasing its truck fleet) to dieting (the Los Angeles Times has shrunk 5 in. in width, estimates that each 1/2-in. trim saves $500,000 a year in paper costs). Last year the Milwaukee Journal, minding its pennies, canceled its annual employees' picnic (savings: $12,000), rerouted its newsprint cars (savings: $1,500), and with other items amounting to as little as $250 a year managed to save an overall $450,000.

Some papers have shaved overhead by forming cost-cutting business alliances. Tulsa's morning World and evening Tribune, spirited editorial rivals, share the same shop. Papers in three Georgia cities have combined as the Georgia Group, whose ad salesmen sell space at a reduced group rate. In a single plant in Clarksville, Tenn., Publisher James Charlet prints nine papers. In a recent, dramatic example, New York's chain-publishing S. I. Newhouse sold plant and property of his strikebound St. Louis Globe-Democrat to the thriving St. Louis Post-Dispatch, which will print the Globe on contract.

Smaller Slice. Successive waves of subscription and advertising increases have not only failed to meet skyrocketing costs, but in some cases have pushed advertisers and readers both into rebellion. New York City's three afternoon papers--World-Telegram and Sun, Post and Journal-American--have yet to recover the circulation they lost two years ago by raising the copy price from 5-c- to a dime. The Chicago Tribune now offers bargain advertising "zone rates" to hold fringe accounts, such as the corner grocer, who neither wants nor will pay for a citywide broadside. In Pasco, Wash., Sears, Roebuck began distributing handbill ads rather than accept the latest hike in ad rates. Moreover, newspapers, which once enjoyed a hefty 45% of the advertising pie, must compete with television. Last year alone, TV's portion rose 1% to 13% of the pie. The newspapers' 1958 share: 30.6%.

Drastic steps may be necessary to restore economic health. Neither a subsidy nor a public utility, the U.S. daily press is free private enterprise, and owes its existence to the profit margin. "The question is," writes Hartford Courant Editor Herbert Brucker in the Saturday Review, "will the cost squeeze continue its ravages until even those newspapers that enjoy a monopoly can no longer survive?" At last week's A.N.P.A. convention, no one had the answer. And the number of newspapers kept going down: in the last eleven months competitive papers had sold out to leave Tampa, Grand Rapids, New Orleans, Cincinnati and Charlotte, with a combined population of 2,450,000, as monopoly towns.

This file is automatically generated by a robot program, so reader's discretion is required.