You read it here first….
On April 11th to be exact. About the seemingly inevitable quarterly Kansas City Star layoffs and/or cutbacks of the past 4 years that appear poised to go down Monday.
For two reasons; ongoing, declining revenues both advertising and circulation. Which are measured and marked to the market at the end of every financial quarter.
And with with parent company McClatchy‘s newly announced first quarter revenues down 9.5 percent from 2010, the handwriting’s on the wall.
The cutbacks go down on the Monday following pay day. At least that’s the way the game has been played in recent years.
Trust me, I’ve played it.
There are a few wild cards in the mix, but first let’s read a few tea leaves in the just released financials.
Star publisher Mark Zieman likes to explain away the ongoing cuts based on a sour economy. But that’s just the tip of the newspaper freefall iceberg.
Take the Star‘s three and four page obituary – I mean, "remembrance" – section. It’s generally loaded with paid going away ads for oldsters who used to read newspapers. People like my parents. But they no longer need ’em in heaven, and they’re too dang flammable down in Hades.
So cross those folks off the subscriber list.
And speaking of Hades…
Like Charon – the ferryman who carried the dead across the River Styx in ancient mythology – the Star collects passage fees from its former readers – but not in the form of pennies in the eyes of the dead. Rather as obituary ad dollars paid by survivors. Survivors who no longer rely upon newsprint for news.
Now about those financials…
The story in today’s Star about McClatchy’s disappointing digits notes that 60 percent ($180 million) of the newspaper company’s total revenues came from print ad sales. Online advertising is pegged at $45 million or 15 percent.
That leaves 25 percent of McClatchy’s revenues unaccounted for.
The lion’s share of that number (22 of 25) is identified by McClatchy- but not in the Star story – as circulation revenue ( subscriptions) at $66.2 million. In other words nearly 85 percent of all the money coming in comes from the beleaguered print side of the biz. And with print circulation or readership down 5 percent, it’s not hard to see the handwriting on the wall.
A disastrous combination and trend of both fewer ad and circulation dollars coming in.
Not just because of the economy, but because fewer people are paying (and willing to wait) to retrieve their news from their driveways.
It ain’t pretty, ladies and gentlemen.
Now some wild cards…
While the Star has been unable to unload its gleaming new print facility downtown, it did manage to dump off three of its properties nearby recently on downtown developer Brad Nicholson. That may help some, but Nicholson’s a sharpshooter and the chances he paid anything close to top dollar are slim.
And as mentioned here in the initial reporting on possible first quarter cuts, the Star could unload, cut back or do away with losers like the Olathe News and Lee’s Summit Journal. Properties it paid millions for in all likelihood, that 10 years later are now worth next to – if not – nothing.
And there could be some savings realized on the buildings that were dumped – property taxes, utilities, upkeep, etc.
So we’ll see…