We all need the Reading Eagle

Soon after I started working at the Reading Eagle more than 40 years ago I heard the first of many rumors that the newspaper company was being sold. It was a valuable and profitable company then and it made sense that larger newspaper companies, especially chains, would covet a vibrant family-owned community newspaper. 

Every year as new rumors surfaced, there were assurances that the family had no intention of selling. The family, descendants of founder Jesse Hawley, who published the first edition of the Eagle on January 28, 1868, was committed to serving the people of Berks County.

And that continued for a century and a half. 

All of that changed last week when executives at Reading Eagle Company announced they had filed for Chapter 11 bankruptcy protection and are seeking a buyer. 

It is sad news for the company, its employees and the community. Those of us who have retired from the Eagle are hurting, too, because we invested so much of our lives in that great institution. We worry about the future of the 250 employees who remain at the Eagle and at WEEU radio, South Schuylkill News and REP commercial printing, which the company also owns. We worry about our community, which needs a local newspaper.

For many people, the news was shocking, but change has been coming for some time. 

The newspaper industry has suffered in recent years. Several weeks ago Joyce Terhaar, former executive editor of The Sacramento Bee and a board member of the American Society of News Editors, wrote about the state of the industry: “In recent years, the outcome has become dire, with nearly one in five — almost 1,800 newspapers — closed in the last 15 years, according to Penelope Muse Abernathy, the Knight Chair in Journalism and Media Economics at the University of North Carolina.”

Many of those were community weeklies, but dailies also have closed.

Others have been sold, some more than once. Circulation has declined significantly, and so has advertising, the two main revenue streams that fund newsrooms, as more people have sought free information – not always real news – on the internet, and as businesses turned to the internet and direct mail to connect with customers.

According to a recent report by the Pew Research Center:

“The estimated total U.S. daily newspaper circulation (print and digital combined) in 2017 was 31 million for weekday and 34 million for Sunday, down 11 percent and 10 percent, respectively, from the previous year.”

Circulation has been on a steady decline for years at most newspapers, and internet traffic hasn’t made up for the loss in print readership. According to Pew:

“Gauging digital audience for the entire newspaper industry is difficult since many daily newspapers do not receive enough traffic to their websites to be measured by comScore, the data source relied on here. Thus, the figures … reflect the top 50 U.S. daily newspapers based on circulation. In the fourth quarter of 2017, there was an average of 11.5 million monthly unique visitors (across all devices) for these top 50 newspapers. This is nearly the same as in 2016 (11.7 million), making this the first year since we began tracking the trend that did not show a double-digit rise in web traffic: There was, for example, a 21 percent increase from 2015 to 2016 and an 18 percent rise from 2014 to 2015.”

Advertising revenue also has declined. Pew, citing figures from the News Media Alliance and Editor & Publisher magazine, reported that total newspaper advertising revenue in the U.S. fell from $49.4 billion in 2005 to $16.4 billion in 2017.

As a result of those losses, many of the news companies that continue to operate have cut staff.

Pew recently reported: “According to data from the Bureau of Labor Statistics’ Occupational Employment Statistics, 39,210 people worked as reporters, editors, photographers, or film and video editors in the newspaper industry in 2017. That is down 15 percent from 2014 and 45 percent from 2004.”

TheEagle,in stories about its bankruptcy filing, reported that advertising revenues declined from $17 million to $12.6 million between 2016 and 2018. It lists daily circulation at 37,000 and Sunday at 50,000. 

Several years ago, when I still was the editor at the Eagle, I was told by ownership that the one area that was not to be cut was the newsroom, because without strong content the newspaper could not survive. Yet, soon after I retired more than a year ago, 13 positions were cut in the newsroom. That didn’t help.

Neither did the cost-saving moves to reduce the number of pages and eliminate some features in the newspaper. But when revenue declines, something has to be done to reduce expenses.

All of those moves weren’t enough for the Eagle.

The model that has existed for centuries no long is sustainable. But focusing on the business side rather than on the journalism won’t save it. And it won’t help our community or our nation and the freedoms that newspapers protect.

The future likely will have a scaled down version of news delivery that still will require dedicated editors and writers. Most notably, it won’t be free. It likely will require benefactors who are willing to help fund independent journalism and consumers who are willing to pay for credible news.

When a community loses its local newspaper it loses part of its conscience. 

Who provides credible and accurate information about what is happening in the community?

Who asks the hard questions?

Who represents citizens when they are too busy or distracted?

Who holds public officials accountable?

Over the course of 20 years, Chuck Gallagher, who preceded me as editor of the Eagle, and I took a newsroom that was revered and respected and built a dream staff. We hired excellent editors, photographers, designers and some of the best writers in the state. Some came from other regional newspapers that were struggling and making staff cuts. Others wanted to be part of what was becoming one of the top newsrooms in the state.

Although journalists don’t focus on winning awards, the recognition of hundreds of awards – including the current streak of six Keystone Press Awards sweepstakes, a Pennsylvania Newspaper of the Year Award last year and three straight Inland Press Association national Community Leadership Awards beginning in 2013 – came as the result of doing quality journalism.

All of that was important. It served the community, and it made us feel good, but it couldn’t save the company.

The Eagle’s $20-some million investment in a new printing press and distribution center that opened in 2009, and the resulting debt, was too much to overcome as more readers turned to the internet for free information and as advertisers used the internet and direct mail to connect with customers.

Last week the Eagle’s newsroom reported its company’s own story, including specific details from its bankruptcy filing. That’s a tribute to the excellent reporters and editors still there. In the Friday edition, they included a list of creditors. 

The Eagle cited bankruptcy papers that listed the company's assets at just over $15 million and its liabilities at almost $38.5 million.

It also listed its shareholders and their percentages, which I’m sure few in the public had ever seen from this private company. 

Among the Eagle’s stories was one announcing that the company’s chief financial officer was trying to put together a group of investors and financing to purchase the company. Something isn’t making sense there. 

I have my own theories about what drove the Eagle to the cliff, but sharing those here would serve no purpose at a time when positive solutions are needed. 

These days it is nearly impossible for a newspaper to survive under leadership that doesn’t understand the basics of good journalism and doesn’t value and respect employees. Those things have to be part of a newspaper company’s fabric and culture.

Maybe another family or community group will come forward and purchase the company. It would have to be someone or some group that sees the value of local journalism as something more important than profits. It will take someone with a lot of resources, including deep pockets. It will take someone with strong management skills.

More likely, as has been the case in other communities in recent years, some large company from another community or state will see an opportunity to buy at a bargain price and cut its way to a profit. That’s very sad, but it’s the reality of journalism today.

It’s also reality that many younger people refuse to pay for news and choose to get their information online from sources that often are not credible, including much of what is posted on social media.

Before I retired and shortly after, I reminded people about the importance of community-based newspapers. I encouraged them, in what I wrote in my Sunday column and in conversations with people individually and while speaking at events, to support local news by subscribing to the newspaper and encouraging local advertisers. I warned that people won’t realize how important local news coverage is until they lose it.

It costs money to collect and distribute local news. You can’t support a stand-alone community-focused newsroom solely on advertising revenue. Many people don’t understand that or refuse to accept it. As one long-time newspaper executive often told me: Facts are stubborn things. Citizens need to invest in local news; there is no free ride.

Yet, through the online posting of this news about the state of the Eagle last week, some people continued to criticize the Eagle’s model of charging for news. I often wonder why they don’t criticize grocery stores for not giving them free food or utilities for not providing free services. Maybe people think they can’t live without those things, but they don’t believe they need a newspaper. They are wrong.

Some on social media labeled the Eagle’s reporting as liberally biased. Others criticized the Eagle as too conservative. In both cases, they are wrong.

You would be hard-pressed to find a more balanced or accurate newspaper than the Eagle is. 

Early last year, the Reading Eagle marked its 150^th anniversary. It’s sad that a year later the company’s days as a family-owned newspaper appear to be over. Regardless who owns it in the future, two things are critical:

■ The community must have a local news company.

■ That local news company must have the freedom to independently report the news.

If not, we’ll all pay the price.