Report: Local Newspapers In Danger Of Vanishing

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After suffering a historic meltdown a decade ago in the financial crisis, American newspapers began racing to transform into digital businesses, hoping that strategy would save them from the accelerating decline of print, reports The Wall Street Journal.

The results are in: A stark divide has emerged between a handful of national players that have managed to stabilize their businesses and local outlets for which time is running out, according to a Wall Street Journal analysis of circulation, advertising, financial and employment data.

Local papers have suffered sharper declines in circulation than national outlets and greater incursions into their online advertising businesses from tech giants such as Alphabet Inc.’s Google and Facebook Inc. The data also shows that they are having a much more difficult time converting readers into paying digital customers.

The result has been a parade of newspaper closures and large-scale layoffs. Nearly 1,800 newspapers closed between 2004 and 2018, leaving 200 counties with no newspaper and roughly half the counties in the country with only one, according to a University of North Carolina study.

Meanwhile, about 400 online-only local news sites have sprung up to fill the void, disproportionately clustered in big cities and affluent areas, the UNC study found.

The shrinking of the local news landscape is leaving Americans with less information about what's happening close to them, a fact Facebook recently acknowledged as it struggled to expand its local-news product but couldn’t find enough stories. Local TV news is still a major, if declining, source of news for Americans, but local newspapers are vanishing.

Warren Buffett’s U-turn on newspapers is an indicator of the industry’s predicament. The legendary investor began buying up local papers in 2011, betting they could overcome the horrible economics of the print business by making a transition to the internet.

They didn’t. Last year Buffett turned over management of his papers to another company, Lee Enterprises. He recently told Yahoo Finance that newspapers were "toast," adding that, with the exception of the three biggest national papers, "they are going to disappear."

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