History is happening before our eyes. The New Yorker published an article by James Surowiecki which speculates that newspapers may soon disappear. Indeed, the Tribune Company filed for bankruptcy last week. Surowiecki says that others will soon follow. The Miami Herald and the San Diego Union-Tribune are reportedly on the selling block, while lawmakers in Connecticut are trying to keep two newspapers there afloat. Even the New York Times Company has slashed its dividend and announced that it would borrow against its headquarters to avoid cash-flow problems.
"There's no mystery as to the source of all the trouble: advertising revenue has dried up," writes Surowiecki. He blames several factors, including both the overall economic climate of today plus competition from broadcast media and the Internet. In addition, many traditional advertisers, like big department stores, are struggling, and the bursting of the housing bubble has devastated real-estate advertising.
Newspapers almost owned the classified ad business and apparently thought it was theirs forever. To their surprise, Craig's List and similar web sites have stolen the classified ad business while the newspapers slept.
Surowiecki points out that newspaper web sites are often more popular than the printed newspapers themselves, but the web sites typically generate less revenue.
You can find this interesting article at http://www.newyorker.com/talk/financial/2008/12/22/081222ta_talk_surowiecki.