Saturday, April 5, 2008

As one news chain spirals into bankruptcy, the big question is "Who's Next?"

According to a report published today, the Journal-Register Company--one of those third-tier media empires you've never heard of but turns out owns over 300 papers--has brought on an investment bank as it considers filing for Chapter 11.

If the company were to seek bankruptcy protection, as analysts said was possible, it would be a first in recent memory for a publicly traded newspaper company, John Morton, a longtime newspaper analyst, said.

The holdings of the Journal-Register comprise "Greater Philadelphia, Michigan, Connecticut, Greater Cleveland and the mid-Hudson region of New York," and many of their titles seem to be the kind of ad circulars and free shoppers (personal favorite: The Penny Stretcher) that you would expect to be taking a beating in the 21st Century. But they also hold a cubic ton of tiny local papers, the exact kind that the "hyperlocal" argument says should be able to be leveraged to great advantage in the "competitive news environment" we find ourselves in now.

Now I have no doubt, just looking at the Journal-Register Company's website itself, that they weren't leveraging those assets very well online (a quick check at a random title confirms it, though I do appreciate the lead story: "Local canoe challenge will be tribute to legendary canoeist"), but the real question is can it be possible for any company like the Journal-Register to turn their ship around at this point? How can you innovate 300+ papers at the same time, without going under in the process?

I guess the real argument is simply this one: You're going under anyway, why not give it a try?

It's probably too late for the Journal-Register, but the next mid-tier chain should start trying to answer that question before it's too late for them too.