DEATH IN HONOLULU MEANS MORE THAN JUST ONE LESS PAPER

Star-Bulletin's demise may spell the end of the newspaper JOA

As someone who worked in a joint operating agreement (JOA) newspaper for the vast majority of his professional life, I never really questioned the efficiencies: combined production, ad sales and distribution meant 24-hour usage of capital equipment and plant.

The downsides were legendary: infighting between the partners, ennui even at the highest levels of agency management and a general inability to get anything out of the ordinary done. But, the cash kept flowing to the bottom line, and so we continued in the arrangement.

As recently as two years ago, I would have still been bullish on JOAs. They're certainly not right for every town, but they were working pretty well in the 17 where they were in place.

Then all hell broke loose.

First, the JOA in El Paso, Texas, died in October 1997; then Nashville, Tenn., in February 1998, followed quickly by Evansville, Ind., in September 1998 and Chattanooga, Tenn., in December 1998. Suddenly last summer, Hearst announced it was shutting down San Francisco's JOA.

And now, Honolulu's JOA will die next month (see Senior Editor Pete Wetmore's story inside). But it's not just the joint operating agreements that are dying – there is no longer an El Paso Herald-Post, a Nashville Banner, an Evansville Press or a Chattanooga Free Press. There will, shortly, be no San Francisco Examiner or Honolulu Star-Bulletin.

The loss of the Star-Bulletin is interesting, in that a decade ago, it had roughly the same circulation as the Advertiser (they both sold about 90,000 papers a day). The tide changed in Hawaii over the last few years, as a stagnant economy that was hobbled by what has been called the "Asian flu" (the wobbly economies of Japan and Korea) caused a dramatic drop in Star-Bulletin circulation.

When you roll in the closures in two-paper towns where both properties were owned by the same company – towns like Santa Monica, Calif., Phoenix and Indianapolis – the last couple of years have been hard on papers, especially evening papers.

This is despite the fact that the newspaper business is as good as it ever has been.

Each of the situations cited above were different – papers were sold for varying reasons, companies established new priorities, markets shifted – but the result is still dead newspapers.

Not to mention lost readers – frequently, the surviving paper does not pick up a whole lot of the people who didn't buy two papers a day. Those readers are completely gone, disappeared from the reading public as if they had died.

Twenty years ago, 22 percent of all papers were morning; a decade ago, 33 percent were morning. Today it's closer to 50 percent (and there are almost 300 fewer papers than 20 years ago).

With national advertising making a bigger and bigger contribution to a daily paper's income – and with national advertisers willing to go into only one paper per market – the drop of two-newspaper towns has also been precipitous: 20 years ago, there were more than 180 two-newspaper towns (whether under common or separate ownership); within days there will be fewer than 45.

The business is changing. I was speaking with the publisher of a major metropolitan daily the other day and he said that he doesn't run a newspaper, he oversees "an integrated communications company." He has put his money where his mouth is – his business is deeply involved in on-line, direct mail, contract delivery, job printing, niche publications and oh, yeah, newspapering.

Competition is no longer between two or more newspapers in a market; the competition today is for the reader's time and everything – from soccer practice to hobbies to work to homemaking to TV to the Web – competes for that time.

Newspapering is a different animal today than it was even a decade ago. The changes have been wrought by the hyperspeed of the change of society.

The JOA is dead. Long live the JOA.

– David M. Cole

Inside ...

• Circulation losses force Honolulu Star-Bulletin to fold after 117 years
• Boston Globe seeks Sunday growth with bulldog edition
• An icon, the paperboy, gives way to adult carriers at many papers
• Knight Ridder regional web sites play off national Real Cities network
• Alliances in Denver, Boston, designed to grow two media
• One size does not necessarily fit all
• Persons

From NEWSINC., Sept. 27, 1999, Copyright © 1999, The Cole Group. All Rights Reserved.