DENVER—The joint operating agreements that were meant to save dying publications in two-newspaper cities like Denver are themselves dying off.
JOAs were supposed to give struggling newspapers a shot at survival by letting them share business operations and costs with their in-town rivals while keeping separate, competing newsrooms. There have been more than two dozen JOAs.
But in recent years, newsroom and newsprint costs have risen, and the Internet has siphoned advertising dollars and readers, making JOAs increasingly unprofitable.
Denver’s JOA took effect in 2001 between the Rocky Mountain News and The Denver Post, which was promised $60 million by the owners of the News to enter the agreement.
By Jan. 1 of this year, the Denver JOA was among just nine remaining—but barely. The E.W. Scripps Co., citing $16 million in losses last year, put the News up for sale. The Post’s owner, ap Inc., sought $20 million in wage and benefits concessions from unions.
JOAs in Detroit, Seattle and Tucson, Ariz., are limping too: Hearst Corp. says it may close the Seattle Post-Intelligencer if it can’t find a buyer, and newspapers in Detroit are cutting deliveries to three days a week to slash costs for the agency that handles their business operations.
Gannett Co. will close the Tucson Citizen if it does not find a buyer for certain assets owned by the paper by March 21.
Other JOAs are in Charleston, W.Va.; Fort Wayne, Ind.; Las Vegas; Salt Lake City and York, Pa.
“Having two separately owned and operated newspapers, even under a JOA, just doesn’t make economic sense anymore,” said Michigan State University journalism and communication professor Stephen Lacy.
Newspapers in Albuquerque, N.M., formed the first JOA in 1933. By 1970, newspapers in other cities like San Francisco and Miami had deals to share certain business operations. But the courts weren’t convinced they were legal.
The Newspaper Preservation Act of 1970, signed into law by President Richard Nixon despite concerns from the Justice Department, gave the deals a break from antitrust regulations and cleared the way for more.
The act assumed that the costs of putting out a newspaper every day were so high that two newspapers wouldn’t be able to survive in the same town, Lacy said. But the real issue, he said, has been ad sales.
Advertisers tend to pour dollars into the paper that draws the most readers. The more popular paper would use its cash from advertisers to gain more readers, thereby drawing more advertisers in a spiral that eventually weakened the second newspaper.
“The Newspaper Preservation Act did not change the reason towns were losing two newspapers,” Lacy said.
JOAs haven’t completely stifled newspapers’ competition for advertisers as blogs, Web sites and other media have exploded.
“The idea over time didn’t work out as hoped and planned,” said Rick Edmonds, a media business analyst with The Poynter Institute, a journalism think tank in St. Petersburg, Fla.
“In their heyday, it seemed like they were providing quite a few cities with two papers, but over time some of the flaws became pretty apparent, particularly now with economic situations being what they are,” Edmonds said. “It’s relatively difficult to run a single paper successfully in a metro market.”
Of JOAs that haven’t made it, six involved Scripps papers. Of the surviving JOAs, MediaNews was involved in five, including those in Denver and Detroit.
