No More Star in the South

While I've been focusing on the editorial side of the major newspapers there are some financial updates that you should be aware of.  Last July I reported that Lee Enterprises--which owns the Daily Star--was in the midst of a financial collapse.  By that time, I had covered the demise of the newspaper industry for years and my skeptical friends used to point out that the papers weren't actually going to go away.  They aren't saying that any more.

Here's what I wrote last July. 

I've trumpeted the industry's collapse for several years, however, this last month has the look of a tipping point; the business model is untenable and there will be no capital infusion. 

Since then, Lee Enterprises' stock has collapsed--and it was down another 10% today.  In the last 5 years, the stock has gone from nearly $50 a share to nearly zero.  Check out this astonishing chart; that's what a 99.38% loss looks like.  Pretty soon the Lee Enterprises will be de-listed and we won't even be able to look it up. 

The Star is an ice cube on the kitchen counter.  Sure, it still has some substance left, but its demise is inevitable.  It will soon be just a little puddle and eventually a hard water stain.  But the point is that it's over. 

The demise is  unfortunate, after all, there is actually some talent on the news side.  Of course, most people don't appreciate the quality of the reporting  because it's always being undercut by the hapless editorial board. 

Could the story have been different?  I've argued that a paper is generally known by its editorial stances.  The Star has been reflexively liberal, but you can only go so far by pandering to fraction of the population who describe themselves as liberal...even in Tucson.  The vapid arguments, ad hominem attacks and obvious ignorance of the issues will eventually turn off even the most devoted liberal reader.  

The Star will still exist for a while, but it's in a winding down phase.  It will continue to cut costs in an attempt to chase falling revenue, but it will eventually need a cash infusion for a new press or for deferred maintenance costs and that cash won't be there.  A thousand fortunes have been lost on the Star in the last five years.  A thousand is enough.  It's over.   

Comments

[Retrorv]

"The Star has been reflexively liberal, but you can only go so far by pandering to fraction of the population who describe themselves as liberal...even in Tucson. The vapid arguments, ad hominem attacks and obvious ignorance of the issues will eventually turn off even the most devoted liberal reader." So true. Even to liberal readers, such as myself, their editorial columns are so poorly written and based on bad or incorrect reporting (often their own) that their opinions are more than meaningless-they're laughable. This is one of the problems with the soon to be defunct Citizen. It used to offer a conservative alternative voice but over the past 10 to 15 years it has swung decidedly left. The Star is now essentially one news section. On most days, the national, local, business, and opinion sections are all in one section. There's a sports section, a throw away section based on wire sources, and classified. Its sad but inevitable.

[Travis]

The newspaper industry shrinks and the size of government grows. Gee, I wonder where all the "journalists" who wanted to change the world will go...

[Biz Observer]

Lee paid its Tucson employees 2 days early this week and returned employee stock option funds that it had been accumulating, presumably because there is no stock to sell them.

[John Echols]

Don't forget that Lee also owns the AZ Daily Sun in Flagstaff.