Newspapers’ bad news day

Monday was “a big day in the world of media,” said John Hinderaker in Power Line. The Tribune Co., which owns the Chicago Tribune, the Los Angeles Times, The Baltimore Sun, and other papers, filed for Chapter 11 bankruptcy, and The New York Times said it needs to borrow $225 million against its New York headquarters. Newspapers are in trouble because they haven’t figured out how to make up for losing their “cash cow,” classified ads, to the Internet.

And Tribune Co. is merely the “first domino” to fall, said Denny Wilkins in Scholars & Rogues. If your local paper is “a big metropolitan daily, it’s for sale—you just haven’t been told that yet.” After all, who wants to invest in a business that’s “losing gobs of money, has fired or bought out its best artisans,” and whose only solution has been “cutting more costs?”

The newspaper industry may be ailing, said Stephane Fitch in Forbes online, but “Tribune Co. would be trundling along profitably” if it weren’t for owner Sam Zell. Even the Tribune newspapers are still profitable. The company is in trouble only because Zell saddled it with a huge amount of debt in his highly leveraged buyout a year ago.

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Bankruptcy was Zell’s “Plan D,” said Ken Doctor in paidContent.org, after he bought at the wrong time, failed to sell assets, and couldn’t renegotiate with Tribune’s lenders. Still, the move shows that “no news brand is sacred,” that we have “no idea what the 2015 news landscape will look like,” and that in the meantime, all newspapers are just “buying time.”