Two of the Midwest's biggest newspapers, struggling to stabilize their finances, are implementing further cutbacks including wage cuts and unpaid furloughs. The reductions at The Plain Dealer in Cleveland and the Star Tribune in Minneapolis are part of an industry-wide retrenchment as publishers confront plummeting ad revenues and a credit crunch. At The Plain Dealer, owned by Advance Publications, 500 union workers belonging to the Northeast Ohio Newspaper Guild Local 1 and Teamsters Local 473 agreed on Thursday to take a total wage reduction of 12%, which includes an 8% reduction in actual pay and 11 days of unpaid furlough. This is the second round of pay cuts and unpaid furloughs at the paper; the first round, including a 10-day unpaid furlough, hit non-unionized employees in March. Separately, the Star Tribune of Minneapolis submitted a Chapter 11 bankruptcy reorganization plan to the U.S. bankruptcy court for the Southern district of New York last week. If the plan is approved, the paper could exit Chapter 11 bankruptcy protection as early as this fall. To lay the groundwork for the plan, the Star Tribune's management has extracted critical concessions scaling back wages, benefits and employment guarantees from most of the Tribune's unions, yielding about $20 million in cost savings. It has also required negotiations with a number of lenders, with top priority given to secured creditors. As part of the plan, publisher Chris Harte said "previously issued equity will be canceled and will not result in any recovery to the owners." He added, "The Plan also provides for the reorganized company to emerge from bankruptcy as a privately held enterprise." A vote for approval of the plan by various creditors will be held in July, and confirmation of the plan may come in September, allowing the paper to exit bankruptcy shortly thereafter. As part of the reorganization, private equity investors Avista Capital Partners will lose their ownership stake in the company, as creditors assume control of the company. This represents an embarrassing setback for Avista, which bought the Star Tribune for about $530 million in 2007. After its bankruptcy reorganization, the paper, with all its assets, will be worth about $120 million to $140 million.
Univision and Telemundo were concerned that the number of Hispanic homes that were unprepared for the June 12 digital transition could lead to a notable ratings decline. But that fear appears to have been unfounded. Instead, the normal ups and downs of prime-time ratings occurred at the top Spanish-language networks -- with no pattern of decreases. On Saturday, June 13 -- the first night after the transition -- Univision saw total viewership in prime time increase 10% over the previous Saturday. Telemundo, by the same measure, saw it drop 75% over the week before. But the following night -- the second after the transition (Sunday, June 14) -- there was a reverse dynamic. Telemundo saw a 20% increase in total viewers compared to the Sunday before, while Univision fell 9%. Univision is a more popular network overall, with a 2008-09 season average of 3.9 million prime-time viewers. Telemundo, by the same metric, averaged 1.2 million viewers. For the week of June 8-14, Univision had all of the top-10 broadcasts in total viewers, led by episodes of telenovelas "Mañana Es Para Siempre." The networks appear to have had a minimal ratings impact from the transition, largely because the number of Hispanic homes that wound up losing reception was relatively low. Two days after the June 12 switchover, 3.6% of Hispanic homes were without TV service, according to Nielsen. That group may be low TV watchers anyway. But in late 2008, the switchover was assumed to impact ratings more dramatically. Nielsen reported then that 11.5% of Hispanic homes were not ready for the transition. There were some suggestions that a language barrier might lead to older Hispanics (and others) losing reception. Both Univision and Telemundo continued with extensive efforts to inform all viewers about the coming digital change. More evidence that the June 12 transition offered a mixed bag of ratings results and no pattern of declines came in the key 18-to-49 demo. On the first night after the transition, Univision saw a 12% increase in ratings versus the Saturday night before; Telemundo by the same measure had a 77% drop. Then again, the following night brought countervailing results. Univision's demo ratings were down 15%, while Telemundo's increased 30%.
ESPN's multiplatform coverage of next year's World Cup will include live games on a new medium. For the first time, the ESPN Radio Network will offer play-by-play coverage of some of the tournament's 64 games. Details are unclear, including how many games will be made available. The move is curious, given Americans' already limited hunger for televised soccer, although the World Cup grows in popularity every four years. ESPN carries World Cup games on TV sans commercials during the action, and the same is likely on the radio. Advertisers would be expected to get multiple audio mentions. The announcers for the radio games may not be on-site in South Africa next summer, but in a studio in ESPN's Bristol, Conn. campus. That is often the case for international matches carried on ESPN TV, a cost-saving measure. ESPN declined comment. If ESPN were to gauge interest in World Cup games on radio, next year would seem to be an apt one. The company has promised its heaviest promotional push ever behind any single event for its Cup coverage, which includes games on ESPN, ESPN2, ABC and ESPN360.com. ESPN Radio has hundreds of affiliates around the country that carry its NBA and Major League Baseball feeds. How many can be persuaded to air soccer games, especially in small markets, is an open question. ESPN also has five owned-and-operated stations, including in the country's top-three markets. Soccer has a significant following on Spanish-language radio in the U.S. -- including ESPN Deportes Radio -- but is not as widely available in the general market. For example, games of the Major League Soccer team in New York are carried on a Spanish-language station, but none are available on an English-speaking outlet. However, MLS' Los Angeles Galaxy games, which include star player David Beckham, are available in English. And excitement is so high in Seattle about the new MLS team that all home and away games will be carried this season. Sirius XM offers European competition coverage, such as the English Premier League and the UEFA Champions League.
Advertisers take note: Americans are perhaps even bigger multitaskers than previously realized. A new study by Experian Simmons shows that Americans would actually need 38 hours in a single day to complete all their daily tasks. Since there are only 24 hours in a day, Americans multitask heavily. The fall 2008 study says the biggest multitasking period comes when watching television. While nine out of 10 online adults watched television in a given 24-hour period, 72% of them multitasked by using at least one of 12 measured media. The three biggest activities are the Web, 27%; mobile phone, 26%; and emailing, 23%. The 38-hour day adds up as follows: working, 6.6 hours; sleeping, 6.1 hours; television, 3 hours; Internet, 2.4 hours; and radio, 1.7 hours. Time spent with books and computer games are each 1.5 hours. Listening to audio online, gaming on consoles and eating are at 1.4 hours each. Instant messaging and listening to an MP3 player are at 1.3 hour each. Commuting is 1.2 hours. Emailing, portable games, and exercising are each 1.0 hour a day. Watching videos online, grooming, texting and using wireless devices to access the Internet are each 0.8 of an hour. Newspapers are at 0.7 hour and magazines are 0.6 hour. The fastest-growing new medium continues to be social networks. Fifty-four percent of adults have visited a social-networking site in the last 30 days, which is almost a threefold increase from a new media study conducted by Experian Simmons in fall 2007.
With publishers squeezed by declining ad revenues and frozen credit markets, many small newspapers are on the auction block for record low prices, according to Cribb, Greene & Associates, a brokerage that handles mergers and acquisitions for daily and weekly publications. What's more, many of these smaller and mid-sized newspapers may actually be viable investments. Their revenue losses have been significantly smaller, on average, than big metro dailies. Many such newspapers can currently be had for a price equal to somewhere between just four and eight times their earnings before income tax, depreciation and amortization (EBITDA), according to John Cribb, the brokerage's managing director. That's a big discount from just a couple of years ago, when prices equal to 10-14 times EBITDA were more typical. The discount is especially steep because EBITDA itself has also fallen, in conjunction with the broader economic downturn. However, small and mid-sized newspapers may actually find buyers, having fared better over the last couple of years than their big-city counterparts. While it's hard to find reliable numbers for smaller newspapers (which are often privately owned), Cribb said ad revenues are typically only down 10%-15%, noting: "Certainly, these are ugly numbers compared to what newspapers are used to, but they are not disastrous. This is not the financial condition of an industry that is failing." According to the Newspaper Association of America, total newspaper industry revenues fell 28.3% in the first quarter of 2009, following a full-year drop of 16.6% in 2008. But this fails to distinguish between bigger and smaller properties, whose fortunes have diverged markedly. The relative vitality of small and mid-sized newspapers has been attributed to a number of factors. On the editorial side, local news has not been commoditized like national and international news. Big metro dailies now find themselves competing with online news aggregators and other national news sites (including other big metro dailies) substantially reporting on the same events. By contrast, small and mid-sized newspapers often enjoy a monopoly on local news. On the business side, publishers have cultivated and retained personal relationships with local advertisers, which are possible in smaller communities. Indeed, small newspaper publishers often complain that their businesses are unfairly lumped in with bigger newspapers, perpetuating an excessively negative view of their prospects. Among big publishers, total publishing ad revenues fell 27% at The New York Times Co., 34.1% at Gannett, 29.5% at McClatchy, 24% at Lee Enterprises, 28.6% at E.W. Scripps, and 28.2% at A.H. Belo.
The third Thursday in June had just three original network shows, with Fox's "So You Think You Can Dance?" dominating. "So You Think You Can Dance?" took the top spot for its finals edition, with a Nielsen 2.9 rating/9 share among 18-34 viewers. "Dance" was down 12% versus a week ago. NBC's own reality effort at 8 p.m. had a better go of it. "I'm a Celebrity... Get Me Out of Here" was a bit higher versus a week ago, earning a 1.8/7. NBC didn't have such luck at the end of the evening. "The Listener" headed south by 30% to a 0.9/3. As is its usual performance, CBS -- with repeats of its crime dramas, "NCIS," "CSI" and "The Mentalist" -- was the most economical of any network, performing well at a 1.6/5 among 18-49 viewers, good for second place to Fox. Fox took the Thursday night overall win among 18-49 viewers -- with a 2.1/7. CBS was at a 1.6/5; Univision, a 1.4/5; NBC, a 1.3/4; ABC, a 0.6/2; the CW, a 0.4/2, and MyNetworkTV, a 0.3/1. Fox also took top honors about younger viewers, 18-34, with a 1.8/7. Univision was a close second at a 1.5/6. Everyone else was at, or below, the one rating mark.