News associations see ‘devastating’ peril from the coronavirus shutdown, but have some plans to get through it

'Our members have gone from a weak financial position to a horrible financial condition'

March 26, 2020
Category: Business & Work

Leaders of associations that represent the newspaper industry are normally upbeat, even in the face of a decade-long decline of the business. But clearly these are not normal times.

I spoke Wednesday with News Media Alliance CEO David Chavern, who makes no claim that the industry’s troubles are unique. However, he drew a contrast to businesses like hotels that were healthy before the virus hit.

“Our members have gone from a weak financial position to a horrible financial condition,” he said.

The Alliance focuses on lobbying and more general advocacy with a tilt toward larger papers and chains. By contrast, the Local Media Association represents a broad swath of mid-sized and smaller papers with an emphasis on best operating practices. But even with a different membership and focus, CEO Nancy Lane had a nearly identical take for her group.

Asked about the level of distress, she said, “It’s a range. For some, if this goes on for more than a month or two, they will be closing the doors. To others, this will be devastating, but they will come out on the other side.”

So devastating is the best case.

First up for the Alliance, Chavern said, was to pitch that news media “are a critical industry. We got on it early and have tried to develop a public argument, working with state associations,” as states have a big role in the response to this dual health and economic crisis.

San Francisco did give news an “essential” designation in its lockdown order. Chavern sees some states adopting, and others considering, the San Francisco model or something similar.

At the federal level, Chavern said, the Department of Homeland Security has a longstanding federal list for essential infrastructure assistance. Formulated after the Sept. 11 attacks and Hurricane Katrina, it does include newspapers.

But the stimulus package doesn’t seem to be sector-specific, he said, except for airlines and a few others. Many newspapers will qualify for special loans from the Small Business Administration. But as restaurateurs and shop owners have been saying, how will they repay them since they were only marginally profitable in the first place?

Chavern sees one more negative and one positive in the current situation.

Production and distribution have been more and more expensive and problematic over the last few years. Falling print circulation has grown delivery routes to twice the area they used to be, and close to unmanageable. How much worse will that get if the distribution workforce starts calling in sick or staying home for other reasons? If the movement to drop some days of print home delivery accelerates, that would be a further complication.

On the positive side, local newspapers had been quietly worrying, Chavern said, about the “nationalization” of news attention. Trump follies and the Democratic primary had sucked up the air.

“That’s turned 180 degrees,” Chavern said. “People are intensely focused on the local … the number of cases, what’s happening with the schools, curfews and stay-at-home orders.”

Indeed as Poynter and others have reported, digital traffic has doubled and tripled many places as metros and smaller publications offer wall-to-wall coronavirus coverage. New digital subscriptions have similarly surged, both at outlets who have made all their COVID-19 stories free and others who have maintained paywalls for much of it.

Lane, the Local Media Association CEO, offered a quick and smart take in her Wednesday newsletter on how smaller publishers can survive. Among the suggestions: Find a single sponsor (like a hospital) for a COVID-19 newsletter, crank up newsletters overall to harvest potential subscribers, approach community foundations to subsidize coverage of the crisis, and consider dropping days of print delivery.

Perhaps Lane’s most useful finding: “Offer employees optional unpaid time off while still covering their benefits. You might be surprised how many will say yes. One company is allowing up to 12 weeks for an unpaid leave of absence.”

I also spoke with NewsGuild president Jon Schleuss, who defeated veteran Bernie Lunzer in the labor union’s election in December. For the guild, he said, it is pretty much hope for the best and prepare for the worst.

Schleuss would like to see layoffs avoided entirely, but if they become necessary he would prefer furloughs with benefits, voluntary to the extent possible. The guild cannot block layoffs, a management prerogative. But Schleuss said some chapters’ contracts have specific protections and benefits for those departing.

Schleuss (and he is not alone) pointed out that it will be difficult to frame industry subsidies so they “don’t … line the pockets of hedge funds” or other profit-harvesting owners.

Contract bargaining, which had been expanding quickly in newsrooms across the country, may stall some places, he conceded. But organizing should continue at a fast pace and will certainly resume when reporters, desk staff and others are back in the newsroom.

The guild has been experiencing record growth, Schleuss said, adding 1,400 members in 2018, 1,500 in 2019 and 700 so far in 2020. The NewsGuild’s total membership in the U.S. and Canada is now 24,000.

There is a subtle plus to all this. Since managing decline has become regrettably familiar for a long time, chains and individual papers don’t need to start from scratch on emergency downturn plans. Most are sure to have previously considered financial contingency action. In the case of print publishing frequency, for instance, a game plan to cut days of the week next year can be moved up to next month.

My summary: It could all change for worse or for better in a week. Right now we have an industry down on its heels, but not down and out.

Rick Edmonds is Poynter’s media business analyst. He can be reached at redmonds@poynter.org.

Clarification: An earlier version of this story said that New York Gov. Andrew Cuomo was considering whether to include news media on a list of essential services. News media are on New York’s list. Part of a quoted comment from News Media Alliance CEO David Chavern was unclear and has been removed. 

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