Employees of The Tacoma News Tribune are the latest casualties in an industry plagued with falling revenues, mergers and acquisitions, and employee layoffs. According to The Seattle Times, the 135-year-old News Tribune will cut 67 print and ad-insertion jobs next year, including 26 full-time staff and 41 part-time staff when the company shuts down its 45-year-old printing press next year. Impacted employees will receive severance pay, subsidized health care benefits and support in finding new employment.
“The cost of maintaining and updating presses that old is prohibitive, as is replacing them,” said publisher David Zeeck.
In addition to printing its own newspaper, The News Tribune – the second largest newspaper in the state by circulation – also printed The Olympian at its location at 19th and Sprague in Tacoma. Both newspapers, who are owned by the McClatchy Company, and The Bellingham Herald will have to outsource their printing to other vendors in the region. Zeeck said this change would help the company cut costs and allow both newspapers to focus on local reporting and advertising.
In August, McClatchy announced it would be cutting 3.5 percent of its staff, or 140 employees, and implement other cost-cutting measures to help the company to be more financially sustainable. McClatchy President and CEO Craig Forman notified employees in a memo in which he blamed part of the layoffs on declining print advertising revenue.
At that time, Forman said those employees had been notified, so it is unlikely that The News Tribune staff cuts had already been identified. However, Forman also said that most of the cost reductions would come from “legacy areas” so the company could focus on being a digital-first media organization.
News of cuts at the Tacoma paper comes just a month after McClatchy reported its third quarter results, including the following highlights:
- Total revenue for the quarter of 2018 was $191.1 million, a decrease of 10.1 percent year-over-year.
- Total advertising revenue was $95.1 million, a decrease of 17.5 percent year-over-year.
- Digital-only advertising revenue grew 8.9 percent.
- Direct marketing declined 23.6 percent.
- Audience revenue was $84.0 million, a decrease of 3.6 percent.
- Digital-only subscribers grew 47.6 percent to 137,000.
- Average monthly total unique visitors to the company’s websites were 60.5 million.
- Adjusted net loss was $23.8 million, including severance pay and other costs, compared to an adjusted net loss of $2.6 million for the same period last year.
- Operating expenses increased 1.0 percent, in part because of newsprint tariffs.
- The company solid its remaining interest in CareerBuilder for $5.3 million.
Forman put a positive spin on the quarter, despite the adjusted net loss.
“This quarter both our total digital and digital-only advertising revenue surpassed our print newspaper advertising revenues. While headwinds in print newspaper advertising remain strong, this trend in our digital revenue signals that our relentless focus on digital transformation continues to be an effective strategy for sustainability and future growth,” Forman said in a November 9 news release.
“We expect to end the year with a stronger fourth quarter. We’ve launched additional cost-savings initiatives that will be realized this quarter, and we expect our growth in digital subscribers to continue. We cycle over easier advertising comparisons in the fourth quarter, which should improve our ad trends for the entire second half of 2018. In fact, while we are still closing the books for October, it is shaping up to be our best month this year in advertising revenue performance,” Forman added.
Despite the layoffs, cost cutting measures and losses, McClatchy did have some good news in the second half of the year. It launched SportsPass, a sports-only subscription in some of its markets. This new digital product could attract a new audience and bring in another stream of revenue.
The media industry continues to take a hit with layoffs, mergers and acquisitions, and major cost-cutting measures. It seems virtually every company has been impacted to some degree, including some notable ones – Mic, Meredith Corporation and the New York Daily News – while only a handful of news outlets like The New York Times and the Washington Post are showing year-over-year growth. This has been a tough year for newspapers and magazines alike; we hope 2019 will be a bit kinder to the industry as companies strive for successful digital-first strategies.