Losing the News

Local journalism’s demise leaves us vulnerable

By Cecily Hastings
January 2020

In the past decade, news outlets across the country have been gutted and closed, reporters laid off, and publication schedules cut. In 2018, more than 200 news publications closed their doors. There are now huge swathes of our country without local news coverage. They are called “news deserts.”

Locally, we face the same trend. The Sacramento Bee, our largest local news organization, had 9,000 employees a decade ago. Today it’s down to 2,800. But even with a skeleton reporting staff, the Bee remains a primary source for local news. The paper’s work filters across to other media, including television and radio.

The Bee will eliminate its Saturday print edition this month. The Bee’s owner, McClatchy Co., announced its employee pension plan is underfunded by $535 million. Currently, the company has $11.4 million cash on hand and debt of $708.5 million. In the third quarter of 2019, McClatchy reported a loss of $304.7 million, compared with a net income of $7.04 million in the third quarter of 2018. It’s hard to see a path forward. The company’s demise would be a big loss for Sacramento.

The Bee faces another setback with Assembly Bill 5, a new state law that became effective this month. The law reclassifies many independent contractors as employees, including newspaper carriers who have traditionally been independent. California newspapers fought hard for an exemption for delivery workers, but were rejected. They did, however, get a one-year reprieve to adjust their operations. No matter, this law will be another financial blow—potentially a deadly one—to home-delivered daily newspapers across our state.

Inside’s four editions now have the largest print circulation in Sacramento with an audience of more than 83,000 monthly. We serve more than two dozen city and county neighborhoods with a primarily homeowner-occupied audience. Behind us come the Bee (71,586 paid print subscribers) and Sacramento News & Review (free circulation not disclosed, but estimated at 55,000 to 60,000 weekly.)

Sacramento’s top three print publications are radically different. The Bee is a traditional newspaper with both home delivery subscription income and ad revenues from print and digital. Using the massive scale of revenue the Bee once enjoyed, the paper was able to support a large newsroom of reporters, photographers and editors, and contribute generously to the community. For a region heavily dependent on government, the Bee’s corporate support to civic causes was extremely valuable.

This entire paid-subscription model—shared by hundreds of daily publications all over the country—was the backbone of our country’s media landscape. When the internet began to provide vast amounts of news for free—combined with the shift of ad dollars from print to digital—the model was upended. Today, every daily paper struggles to survive.

The News & Review is an independently owned alternative weekly. Typically, this model offers city, state and national news that leans politically left and is targeted to an under-35 age demographic. Alternative weeklies are distributed free from newsstands and supported by print and digital advertising.

This model has been hurt as local and national ad revenues have fallen with the shift from print to digital. At the same time, labor and paper costs have risen. Many alternative weeklies intentionally cut their press runs to save costs. Many also cut back on reporting. Cannabis advertising has been a savior for many alternative weeklies.

Inside Sacramento is an entirely different and unique operation. We are a free monthly and 100 percent dependent on print ad revenue. We produce, print and home deliver our publications to select neighborhoods via the U.S. Postal Service. As a monthly, we have a small business footprint, using primarily independent writers, photographers and editors. Our business model has had challenges in recent years as paper prices escalated. We recently developed a small revenue stream from digital, but it only covers our website costs.

We don’t slant news politically, other than to do our best to hold local politicians accountable for their decisions. My love of our community, combined with my optimistic nature, generally keeps our coverage on the upbeat and positive side. And as a designer, I’ve always insisted that we produce both a beautiful and useful publication.

When asked what we are doing to attract the millennial audience, I explain that other than launching an all-new website last summer, we intend to continue with our unique operation.

Here’s how it goes: Today’s younger people eventually grow up. As they get settled with careers and family, they hopefully become homeowners. Once they become homeowners, they live in what is usually the most significant investment of their lives. At this point, they start to care much more about their city and how it is led and managed, plus the quality of their neighborhood, schools and small business community.

All three of our top local publications depend on ad dollars to bring you news. This means we are essentially sales operations. Inside has done well in this regard. We have been fortunate to develop long-term relationships with key advertisers who value our targeted neighborhood audiences. In turn, our readers have been loyal in support of advertisers who underwrite the news each month.

Across the country, there is much discussion about what comes after the fall of traditional newspapers. The internet certainly provides an unlimited supply of global, national and even state news. But more than ever, one needs to carefully vet the sources of news, especially news brought to you via social media—where fake news is easily spread. At a time of widespread political polarization, determining a set of baseline facts can be difficult. Media bias is rampant, and opinion polls show public confidence in the media at an all-time low.

The internet’s delivery of news has fallen short on the local level mostly because of the economies of scale. It costs money to report local news—more money than local websites can generate through ads. But a community needs reliable information on how local tax dollars are spent, how local policy affects neighborhoods, and whether local elected officials are meeting constituent needs. This is how concerned citizens make informed choices about who should govern.

How can a community pay for local news coverage? A recent report by PEN America concluded that reinvigorating local watchdog reporting requires concerted action and an investment of billions of dollars across the philanthropic, private and public sectors. The report calls for a new congressional commission to develop concrete recommendations for how the government can better support a free and independent local press.

Despite being competitors for some of the same ad dollars, I don’t look forward to the demise of the Bee—or any local publication. We need more local news, not less. With less local coverage, the only winners are politicians. They would be left with no one to watch, challenge or evaluate their success and failure. Such a reality would not end well for our communities.

Cecily Hastings can be reached at publisher@insidepublications.com. Follow us on Facebook, Twitter and Instagram: @insidesacramento.

 

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