TENNESSEE MERGER POINTS TO FRAILTIES OF THE JOA CONCEPT

Growth of weekly newspapers, web threaten need for two-daily cities

Another one bites the dust. With the announcement that Southern newspaper magnate Walter Hussman would be buying Tennessee's Chattanooga Times (six mornings a week) and folding it into his Chattanooga Free Press (six evenings and Sunday) to make one seven-day morning paper, we have lost another newspaper.

(We will not lose its "voice," though, since Hussman will be providing Chattanooga residents with two editorial pages each day).

By our count, unless something untoward happens in the next couple of weeks, our business will have lost 13 players this year, while gaining only three (most of those stem from the elimination of 10 nameplates in White Plains, N.Y. – and the birth of a new one to succeed all those).

Is the twilight of the 20th century the twilight of the newspaper business? Maybe not – but maybe we are in the twilight of the joint operating agreement.

Chattanooga is the fourth JOA to dissolve since October 1997, with El Paso, Texas; Nashville, Tenn., and Evansville, Ind., also among the casualties (the Evansville Press will continue to publish through the end of this month).

The era of two-newspaper towns gave way in the ’60s and ’70s to JOA towns – communities that can support two newspapers only when they can combine non-editorial functions (like the capital-intensive printing and distribution), reducing costs through efficiencies and allowing both properties to be profitable.

But there just doesn't seem to be much life left in the JOA concept. Most of the 14 remaining agreements operate a morning and evening paper, and – the trend is clear – evening papers are rapidly dwindling.

In addition, national advertisers are less likely to want to invest in two newspapers – they want the larger circulator. Even with JOAs that offer a combo advertising buy, it's getting harder and harder to convince advertisers to be in both papers. Making matters worse is the fact that many local retailers now have their advertising strategy controlled by a franchiser or national company – strategies that often require only one newspaper (if a newspaper at all).

Established to maintain a second editorial voice in communities that had two newspapers, the Newspaper Preservation Act of 1970 is looking a bit creaky these days in other ways. (It was originally called the "Failing Newspaper Act"; a PR person fixed that.)

When anyone with half an opinion and 35 cents can get on the radio to rant and rave, and anyone with some rudimentary computer skills and $20 a month can put up a web site, is the sanctity of published opinion still as important as it was in the ’60s when the NPA was crafted?

Probably not.

Further, the explosion of weekly newspapers means that though a community may have only one daily, it frequently has a handful of weeklies – each with its own rabid editorial page (a "voice," if you will).

Though there are JOAs that are still working well, many of the survivors are beginning to look at the numbers and come to the conclusion that there is more money to be made publishing one newspaper well rather than two newspapers in a half-hearted manner.

In talks with executives involved in many of the remaining 14 JOAs, it's clear that they will last a long time. The two business partners are happy with one another, and the numbers look good. Others are less likely – animosities can outweigh good business sense.

Will 1999 ring out more JOAs? We'll just have to wait and see.

¶

Holiday cheer desk: It's been a good year for us here at NewsInc. and The Cole Group; we hope that you have had a good one, too.

As is our wont, we'll be taking off one publishing cycle this month; we'll return Jan. 4, 1999, with your next issue.

Here's wishing you a good holiday season and a good 1999.

See you next year.

– David M. Cole

Inside ...

• Chattanooga will lose one paper, but its voice will still be heard
• Emotions, legalities fly when a newspaper is changing hands
• Winning political advertising is now a ceaseless effort
• 'Bulk factor' weighs in as a pain to Sunday readers
• Grumpy old geeks want to know: Why do web news, ads mix?
• Persons

From NEWSINC., Dec. 7, 1998, Copyright © 1998, The Cole Group. All Rights Reserved.