Why Ann Arbor Will be the First City to Lose its Only Daily Newspaper

I have been wondering for a year now which American city will be first to lose its only daily newspaper. The results are in, and the dubious distinction goes to Ann Arbor, Michigan, where the Newhouse family’s Advance will shutter The Ann Arbor News in late July.
 
Ann Arbor? Home to the huge University of Michigan, birthplace and headquarters of the Borders book chain and a pocket of relative prosperity with only light collateral damage from the auto industry, a literate place, population around 100,000, one might expect to be appreciative of what print newspapers offer.
 
But some of those apparent strengths seem instead to have proven drawbacks — a curious state of affairs that may provide an unexpected window into what kinds of newspapers are most vulnerable in the brutal business climate of 2009.
 
At a glance, Ann Arbor’s transition to a Web-first publication model with a print product on Thursdays and Sundays sounds similar to the experiment under way in nearby Detroit. There, home delivery of both the News and Free Press has been cut to three times a week, readers are being encouraged to go online or buy an electronic replica edition and a compact print version is being offered on off days to print loyalists who go out and buy it.
 
In several ways, though, the Ann Arbor plan goes further than Detroit or similar cutbacks at the East Valley Tribune in the Phoenix suburbs and hybrid formats at other papers:
  • The Ann Arbor News, after 174 years, will close as a business.
  • Its successor, AnnArbor.com, will be a new Web site, built from the ground up (and therefore supplanting MLive, the current site which serves several Michigan cities with locally tailored editions).
  • The News‘s distinctive headquarters, designed by prolific Detroit-area architect Albert Kahn, will be sold. AnnArbor.com has already taken the ground and top floors in a downtown office building, annoying some by supplanting a popular coffee store.
  • All the staff is being dismissed. Reporters and editors, whose salaries averaged around $50,000 according to one discussion post, can reapply for the many fewer jobs in the new venture, but the pay scale is being dropped to the mid-$30,000 range for reporters.
  • The new publication is being called a “print product” not a newspaper. Hints are that the Thursday edition may be light, targeted to weekend planning, Sunday including longer news takeouts.
Laurel Champion, publisher of the News and Executive Vice President of the new venture, declined to be interviewed for this piece, saying in an e-mail that much remains to be determined over the next month.
 
In announcing in late March that the News would close, she said that the paper lost money in 2008, was losing markedly more in 2009 and gave no evidence of being “sustainable” under a traditional business model. (Steve Newhouse, who runs Advance’s digital businesses, said essentially the same in a brief interview with Crain’s Detroit Business).
 
A tip of the hat to my friendly competitors Fitz and Jen at Editor and Publisher, who suggested just after the announcement that some characteristics of Ann Arbor — especially a young, wired-up populace — work against business success for a newspaper.
 
Tony Dearing, who is joining AnnArbor.com as content director, expanded on the point in an interview with blogger Jim Carty: “What people don’t understand is that, yes, Ann Arbor is a dynamic, vital market… But there are a lot of things about Ann Arbor that make it harder to succeed as a print daily paper. Print papers do a little better with an older audience, and Ann Arbor is a little younger. We do better where there is a high level of home ownership, and there’s a lower level of home ownership. We do a little better where there is a higher level of longtime residents. Ann Arbor is much more transitory.”
 
Carty asks Dearing how smaller properties in Advance’s Michigan Booth group (still operating under the name of previous owners), some facing down-and-out economic stress, can maintain seven-day-a-week publication schedules. His reply: “A daily newspaper is a very traditional product that does best in very traditional communities. Jackson, Saginaw, Flint and Bay Cities are VERY traditional communities. Ann Arbor is a very untraditional community, and it’s just way harder to succeed with a print product here.”
 
I don’t think it is a stretch to extrapolate the Ann Arbor problem to metro markets in the worst trouble — San Francisco, Boston, Minneapolis, Seattle, San Jose. Youngish, upscale, hip, high-tech , a big artistic community — those may all be economic engines for the city but a business negative for the one-size-fits-all traditional newspaper.

Conversely, rankings of newspaper household penetration are always led by such relatively traditional and stable cities as Rochester, Richmond and Milwaukee.

 
Absent more insight from management, I can think of one more competitive negative and a few things Advance may have done to compound its Ann Arbor troubles.
 
I don’t know the campus paper, The Michigan Daily, well, but I have observed in other university towns– Austin, Texas and Athens, Ga. — that a strong paper at a big school is formidable and often quite profitable. It provides enough news to satisfy most of the student population, just passing through for a few years. Plus it sucks up restaurant and nightlife advertising and may be the first ad buy for youth-oriented shops.
 
Newhouse/Advance gained a good reputation through the 1990s and early 2000s for investments in news quality, strong editors and notable editorial improvement at such papers as The (Cleveland) Plain Dealer, The (Portland) Oregonian and The Times-Picayune of New Orleans. But the chain was also known for an informal business culture that worked in good times but seemed to catch the company recognizing late the life-and-death financial crises at The Star-Ledger of Newark and The Jersey Journal.

The News is covering its own demise thoroughly, allowing some lacerating criticism into lengthy discussion threads. But those forums — and similar ones in other Ann Arbor publications — frequently fault Laurel Champion’s predecessors for being remote and arrogant, losing touch with the community and publishing an often-flat product.
Advance is also notorious for weak Web sites, editorially aimless and locked into a rigid and barely navigable design mandated by headquarters. (A ranking of newspaper Web sites last week placed The Star-Ledger‘s dead last among 23 rated).
 
Add it all up, and there are good reasons to start over with AnnArbor.com. I’ll explore in a later piece how the site is taking shape and the cluster of Web and print competitors it will face in America’s first city to lose its daily newspaper.

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