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From AJR,   March 2010  issue

Not So Daily   

WEB EXCLUSIVE
How has the decision by the Detroit papers to reduce home delivery days played out?


By Karen Carmichael
Karen Carmichael is an AJR editorial assistant.     

For the past year, Michigan porches have been a little emptier most days of the week. The state's largest daily newspapers, the Detroit News and Detroit Free Press, slashed their home delivery days in a risky bid to preserve the papers.

"It was really a matter of survival first and growth second," says Paul Anger, publisher and editor of the Free Press. "We were determined to find an economic model that didn't mean the death of us as a business by a thousand cuts, or the death of our newsrooms by a thousand cuts."

Executives stress that unlike other struggling print news outlets, the papers haven't cut publication days. "We print newspapers every single day. We just don't deliver them every single day," says Rich Harshbarger, vice president for consumer marketing at the Detroit Media Partnership (DMP), which manages the joint operating agreement between the Free Press and the News.

The Free Press, owned by Gannett, is now available for home delivery to subscribers only three days a week Thursday, Friday and Sunday. The Detroit News, owned by MediaNews Group, prints six days a week (Monday through Saturday) and is home delivered Thursday and Friday; it also has an editorial section in Sunday's Free Press. Subscribers can access electronic versions of both papers as well as the papers' free Web sites.

Print versions of the newspapers can still be purchased at distribution points such as stores and newsstands throughout Michigan, and same-day mail delivery is available in the greater metro Detroit area, Anger says.

The DMP conducted thousands of interviews with residents of Southeast Michigan to learn how they got their news before launching the new approach on March 30, 2009, Anger says. "We came to the conviction that people would be surprisingly adaptable," he says, and thus far the numbers are encouraging.

The Free Press' Sunday edition remains the sixth largest in circulation in the country, selling an average of 560,188 copies, according to the fall 2009 publisher's statement released by the Audit Bureau of Circulations. The Free Press averages 266,729 Monday through Friday. The statement showed that the News and Free Press have retained the majority of their approximately 330,000 home delivery subscribers, Harshbarger says.

"Our readers have come along with us in this model," he says.

About 1.3 million unique visitors stopped by the Free Press' Web site during February, while almost 1 million visited the News, according to the Web traffic analyzer Quantcast. More than 25,000 unique visitors read the papers' electronic editions on average during non-home delivery days in 2009, Harshbarger says.

Harshbarger would not say whether the papers are profitable. But, he says, the DMP is "confident that 2010 will be a key turnaround year for us," and the company expects to meet or even exceed its financial projections.

The switch, he says, has already yielded "substantial savings" for the papers in fuel and maintenance costs for delivery vehicles. "Before we went to the three-day home delivery, we were driving to the moon and back every week delivering papers throughout Michigan," Anger says. "This is at a time when generations of information consumers get their information digitally.

With the growth of social networking and e-readers as well as traditional Web sites, "people's habits are changing," Anger says. Providing daily home delivery of the printed newspaper is no longer enough; the Free Press must deliver robust news and advertising on a range of different platforms, he says.

The DMP wants to be "platform agnostic," Harshbarger says, in order to provide content "when and where and how people want it." Cutting the delivery days has allowed the papers to further invest in digital platforms and multimedia, he says.

"The technology allowed us to accelerate our digital presentations," Detroit News Editor and Publisher Jonathan Wolman says, "so there was never a moment when you couldn't turn to the Detroit News for developing information and greater context of the news."

The Free Press now produces its own television news segment for CBS Detroit, says Nancy Andrews, the paper's managing editor of digital media. Called "First Forecast Mornings," the show airs from 5 a.m. to 7 a.m. every weekday, providing news stories written, filmed and presented by Free Press staffers.

The Free Press started working with video in 2005 and has won four Emmy Awards, Andrews says, adding, "We're serious about our video."

The first priority, however, is the quality of the news produced and Detroit journalists' ability to cover the city, Anger says. "It's the news and information we provide on all these different platforms that ensures our future and makes the business model work," he says. "If we can't give people that, we just don't have a viable product."

Harshbarger credits the new model with enabling the News and Free Press to continue to cover "compelling stories that readers can't get anywhere else," such as in-depth pieces on the auto industry and Ford's recovery, the attempted Christmas Day bombing of Northwest Airlines Flight 253, and the corruption surrounding former Detroit Mayor Kwame Kilpatrick that was uncovered by the Free Press.

"No other media locally can spend those resources time, money to bring those stories forward," he says.

The new business model "has put us in a good position to do what the staff is committed to do strong journalism for the community," Wolman says.

The editors agree that a goal of the new model is to preserve the two papers' independent newsrooms, although the Free Press cut staff by 10 percent and implemented mandatory furloughs two months after the model was put into effect. The papers now have about 400 newsroom staffers between them, Harshbarger says. He stresses that staff has been cut more on the business side than the newsgathering side, and the papers have instituted the furloughs and wage freezes as a way to help stave job losses.

"The newsrooms have been the last place we've wanted to reduce staff," Harshbarger says.

Reader response has been mixed but generally accepting of the change, Andrews says. Receiving the printed newspaper was a daily ritual for many people, she says, and the change left some feeling, "I miss my paper. It's not the same going on the Web site."

"We're still mourning with our readers who wish they had home delivery every day of the week," Wolman says.

The new model is "full of all kinds of risk," newspaper analyst (and AJR columnist) John Morton says. "You're interrupting people's habits, and you're taking away a substantial service."

It was a smart decision economically, says Morton, who wrote about the switch for AJR a year ago (see "An Intriguing Experiment," February/March 2009). "But it may be damaging in the long run for the franchise."

"How healthy is the business? Are they making any money?" asks newspaper consultant Alan Mutter, who blogs about the industry at Reflections of a Newsosaur. "Over the long term, if a for-profit media enterprise isn't making money, it's not going to be around."

Newspapers' survival depends on advertising revenue, industry analysts agree. Holding onto subscribers isn't nearly as important as retaining advertisers, says Edward Atorino, a media analyst for The Benchmark Company. With ad revenues still falling at rates between 10 and 30 percent, newspapers have no choice but to drastically cut costs to stay in business, Atorino says. Experienced staffers are difficult to replace, but newspapers can always increase their distribution again, he says.

"These are draconian measures, but companies are taking a hard look at what their markets are all about," Atorino says.

News and Free Press executives caution that their decision isn't the solution for every struggling newspaper, but it's worked in the especially hard-hit Detroit market.

"We will not tell you that we're out of the woods, that there are no remaining challenges," Anger says. "But we've been able to make tremendous progress from a year ago."

"Here we are, still standing, and very much competing with one another," Wolman says. "We think that's good for the readership, that they have that competition that there's two vigorous newspapers going at each other every day."