With the sale of the Buffalo News to Lee Enterprises, the News goes from being an independent newspaper under the ownership of Warren Buffett to part of a large chain with headquarters halfway across the country. Chain ownership is rarely a good thing; it’s usually accompanied by cuts in coverage and newsroom staff.
Who owns the News is a secondary concern, however. Our hometown newspaper, like dailies across the nation, faces the daunting task of reinventing itself at a time when the industry is struggling, if not collapsing. Not for nothing, but Buffett last year declared metro dailies were "toast." The News has been in a fiscal downward spiral for more than a decade. Profits once averaged $1 million a week, but those days are long gone; the paper last year cleared about $4 million, and that was better than 2018. Daily circulation is about 87,000, compared with more than 300,000 in the paper’s heyday. (Sunday circulation is about 125,000.)
As stated, circulation losses did slow last year. After the last round of buyouts, the newsroom staff stabilized over the past year to a little over 90 people, a far cry from its peak of 200.
The cost of employing journalists amounts to a fraction of a newspaper’s overhead. There’s the considerable cost of printing and distributing the paper, for starters. Those costs are eliminated when a paper goes digital, and that’s the future for the News and other metro dailies—if they survive the transition.
Print has historically relied primarily on advertising for revenue, while digital relies mostly on subscribers. So the race is on to sign up digital subscribers, a tough challenge given all the free news content available on the web and the general reluctance of people to pay for news online. Progress here has been slow: the News has about 12,000 online subscribers, far behind regional newspapers considered industry leaders, such as the Minneapolis Star Tribune, with 90,000 digital subscribers, and the Boston Globe, whose 115,000 online subscribers exceed its print numbers.
The News is working with Google News Initiative, which should help. So should the sale to Lee Enterprises, as Lee has a reputation as being digitally savvy. Google and Lee can help the News sell more online advertising and subscriptions. There’s a downside to Lee’s ownership, however. The News has long been debt-free, but it is now part of a chain that carries $576 million in debt. That debt will be paid out of the revenues of Lee’s eighty-one newspapers, of which the News is one of the largest. It won’t be enough for the paper to cover its costs; it will also need to help pay down the parent company’s debt.
The dynamics of the Buffalo media market also pose a challenge. Only thirteen percent of Western New Yorkers prefer print publications as their source of local news, according to a survey published last year by the Pew Research Center. Television is the media of choice (forty-eight percent), followed by online (thirty-four percent). Radio is preferred by four percent. The preference for TV news here is stronger than in most markets.
Even worse for print, its audience is dying off—literally. Print newspaper readers are disproportionately older, and the younger generation isn’t interested. Consider another Pew survey, this one a national sampling, that found only two percent of adults under thirty often turn to print to get their news, versus sixty-three percent who turn to websites and social media platforms.
Another challenge for the News: by shedding reporters and scaling back local coverage, it has lost several competitive advantages it once held over local television news. Local news is what primarily attracts eyeballs, be they television viewers or newspaper readers. The News once had well-staffed suburban bureaus, zoned editions, and a much larger local section that provided readers far more stories than the local television stations. That’s no longer the case.
The typical daily paper today includes about a dozen staff-written local news, business and feature stories (as opposed to sports and national/international coverage). WGRZ and WIVB, the two leading television stations in town, typically produce a similar number of local packages during the course of the day. While the News downsized and lost circulation, the TV stations added hour upon hour of news programming. As a result, the News lost audience while the newscasts of the television stations gained viewers. These days, the total audience size of the News, WGRZ, and WIVB, including print, television, and the web, is roughly even.
How is this all going to play out? I don’t anticipate any major changes right away. Publisher Warren Colville and editor Mike Connelly are expected to stay on. Buffett isn’t completely out of the picture, as his Berkshire Hathaway holds Lee’s debt.
I envision a degree of stability for at least a little while. A couple of years down the road could be altogether different—and difficult. The company’s contract with the Buffalo Newspaper Guild expires the summer of 2021. When it does, I would not be surprised if Lee plays hardball in ways Buffett never did, although it has a reputation of being less cut throat than some of the other large chains.
Further staff reductions are almost a given, regardless of who owns the paper or what’s in the labor contract. In addition, the News is going to lose talent and vital institutional knowledge regardless, as many of the paper’s best reporters are approaching retirement age. The handwriting on the wall says further diminishment of the news product is likely, perhaps inevitable. That’s not to say the News won’t survive, most likely as a digital-only publication with perhaps a printed Sunday edition.
To sum up: be concerned about Lee’s ownership, but downright frightened about other factors that are going to determine the fate of the Buffalo News. The paper is facing the fight of its life.
Jim Heaney is editor of Investigative Post, a nonprofit investigative reporting center based in Buffalo.