2004 Annual Report - Newspaper Ownership

Four of the large chains stand out due to their size: Gannett, The Tribune Company, The New York Times Company and Knight Ridder. Not only are these companies much larger than their other public company counterparts, but they also enjoy a greater profit margin (23 percent).⁵ Meanwhile, some of the smaller chains were able to realize large profit margins, but saw stagnant revenues. For these companies, profits do not necessarily mean growth.

Gannett

Gannett is the largest of the four big chains, with annual newspaper revenue approaching $6 billion. Gannett was also the only of the four chains to see revenue growth in both 2001 and 2002, even with a drop in income. Gannett manages its news operations very tightly, and sharply cut back at some of its newspapers, such as the highly regarded Des Moines Register and The Courier Journal in Louisville. Since 1991, the company has increased its revenues by 54 percent in inflation-adjusted dollars (including new acquisitions). Since 1992, Gannett has maintained an average profit margin of 25 percent, including a 25 percent margin in 2001 when total advertising dropped 9 percent in the industry.⁶

Tribune

The Tribune Company is the second-largest newspaper company in terms of revenue due to its acquisition of the Times Mirror Company in 2000. This drove revenue from $1.4 billion in 1999 to more than $4 billion in 2000, before slipping in 2001 and 2002. Before 2000, The Tribune Company experienced a nine-year stretch of stagnant revenue, in inflation-adjusted dollars, although it had earnings margins of well over 20 percent. The company was hit hard in 2001, with a 34 percent drop in income, but saw a steep rise in income in 2002 and the first half of 2003.

New York Times

After several years of stagnant growth, The New York Times Company managed to nearly double its inflation-adjusted revenue from 1991 to 2000. After taking a hit in 2001, The Times is starting to see higher margins, with a 17 percent rate for the first six months of 2003.

Knight Ridder

Knight Ridder has had less growth in recent years than the three other large chains, and in 2002 was off nearly $400 million in revenue from its peak in 1999. In 2001, the company cut 10 percent of its jobs. The chief executive, Tony Ridder, indicated that most of those jobs would not be restored, which led to a greater profit margin in 2002 without a rise in revenues.⁷ Criticism over Knight Ridder's approach was embodied by the resignation of Jay Harris, publisher of The San Jose Mercury News, in 2001 when he said that further cuts threatened the journalistic integrity of the Knight Ridder newspaper.⁸