The New York Times Company, owner of the Boston Globe, has announced that unless the Globe can find a way to trim an additional $20 million from its expenses in 30 days, it will close the newspaper.
The newspaper industry, which had already been struggling as readers and advertisers moved to the Internet, has been hard hit by the recession, and the Globe is no exception. The newspaper's advertising revenues have declined sharply in recent years; once robustly profitable, it is now losing money.
Several major newspaper companies have filed for bankruptcy in recent months, and several have threatened to shut down operations unless they got major concessions from workers. Hearst Corp. of New York in February threatened to shut or sell the San Francisco Chronicle if it could not cut costs. Hearst recently shut down the Seattle Post-Intelligencer after it failed to find a buyer, and Scripps Co. shuttered the Rocky Mountain News in Denver.
Earlier this week, the Globe newsroom completed cutting the equivalent of 50 full-time jobs. But the deteriorating economy has made the paper's financial outlook much worse. Management told union leaders Thursday that the Globe will lose $85 million in 2009, unless serious cutbacks are made, according to a Globe employee briefed on the discussions. Last year the paper lost an estimated $50 million, the employee said.
Not that the New York Times itself is in much better financial shape. It is struggling with dropping ad revenues, as well as a string of scandalous incidents that tainted the Times reputation.
Ironically, some other newspapers are hanging in there, including the Manchester, New Hampshire Union Leader, a conservative publication that is seen by many as the antithesis of the New York Times and Boston Globe.
The Union Leader recently announced measures to ensure it remains profitable, including a change in its distribution system and a larger online presence. In other words, it is being proactive to make sure it doesn't suffer the fate of so many other newspapers.