Wednesday, December 10, 2008

Newspaper Outlook Darkens: Tribune's Fall Reveals Grim Outlook For Entire Industry

As the media giant Tribune Co. filed for bankruptcy this week, the outlook for the news industry looked grim, causing speculation of trying times ahead for major newspapers.

Tribune Co. is looking to sell off its assets to work its way out of crippling debt, but may encounter difficulty in finding a buyer for some of its newspapers. Plummeting ad revenue, a record rise in newsprint costs and the migration of readers to the Internet have forced newspaper publishers to slash expenses this year.

The decline of Tribune Co. was closely tied to its punishing debt requirements, which the company could not pay due to declining revenues.

"We were concerned at the time by the significant debt load they were placing on the company," said Fitch Ratings analyst Mike Simonton, who's based in Chicago. "As cash flow was diminished, we had become more and more concerned."


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