Guardian UK: What's black and white and red all over? Newspaper balance sheets.

[marmar]

Bleed all about it
What's black and white and red all over? Newspaper balance sheets. The Tribune's bankruptcy is frightening

Dan Kennedy
guardian.co.uk, Tuesday December 9 2008 20.00 GMT


In most ways, Monday was just an ordinary day for the newspaper business. Which is to say that everything was going straight to hell.

The New York Times Co, running low on cash, took its brand-new building to the pawnshop, borrowing $225m against the value of its white elephant. Executives at the McClatchy chain were wondering what to do next after they put the Miami Herald up for sale – and found no takers. And at the Cox papers, which include such venerable titles as the Austin American-Statesman and the Atlanta Journal-Constitution, folks were mourning the recently announced closure of the company's Washington bureau.

It would have taken a lot for things to get any worse. Soon enough, though, they did. On Monday afternoon, Tribune Co, staggering under $13bn in debt, sought Chapter 11 bankruptcy protection, which will keep its creditors at bay while it reorganises. The company, which owns two of the country's largest newspapers, the Los Angeles Times and the Chicago Tribune, as well as a passel of other papers, television stations and even the Chicago Cubs baseball team, has now reached a perilous moment in its fight for survival.

The Tribune bankruptcy says a lot about the frightening state of the newspaper business, which is cratering under the weight of such new-media phenomena as blogs and Craigslist.

More than anything, though, it serves as a report card on the truly odd duo running Tribune these days: Sam Zell, a foul-mouthed Chicago real-estate tycoon who, in 2007, bought the already-debt-burdened chain with borrowed money; and Lee Abrams, the loopy radio guru Zell brought in to reinvent a business that Zell himself apparently holds in contempt.

In his short time at Tribune's helm, Zell has established himself as a legend with his withering putdowns of journalists.

"Fuck you," he instructed an employee during a morale-sapping meeting at one of his new papers, the Orlando Sentinel, last January, according to Gawker. ......(more)

The complete piece is at: http://www.guardian.co.uk/commentisfree/cifamerica/2008/dec/09/tribune-company-bankruptcy-newspapers