Bad News By The Bay: Chronicle Faces Job Cuts, Buyer, Or Closure

 

SAN FRANCISCO, CA (February 24, 2009) – The Hearst Corp. today shocked Bay Area newspaper readers with the news that they are taking dramatic steps to "reverse the deepening operating losses" of the San Francisco Chronicle by seeking "significant" cuts to both union and non-union staff – and if they don't get those cuts "quickly" the company will seek a buyer or possibly close the newspaper.

The newspaper lost more than $50 million dollars last year and is "on a pace" to lose more than that this year, the company said.

"It's just a fact of life that we need to live within our means as a newspaper - and we have not for years," publisher Frank J. Vega said.

Vega said the actual cost of producing and delivering the Chronicle to a seven-day-a-week subscriber is double the $7.75 weekly cost of a subscription.

Hearst said in a statement today that it would immediately begin talks with the Northern California Media Workers Guild and the International Brotherhood of Teamsters to seek job cuts. The two unions represent the majority of workers at the Chronicle.

Hearst bought the Chronicle in 2000, but the company says soon after the purchase the Internet bubble burst and the economy and advertising have been on a continuous decline while classified advertising moved online to places like Craigslist.

Hearst owns 15 other newspapers including the Seattle Post-Intelligencer, the Houston Chronicle, the San Antonio Express-News, and the Albany Times-Union.

In early January, Hearst announced that the Seattle Post-Intelligencer will close by March if a buyer doesn't come forward. That newspaper has also been losing money since 2000.

In a story today the Chronicle said that the newspaper employes about 275 people and that it is the largest newspaper in the Bay Area. In the 11-county area there are 21 daily newspapers, but the Chronicle is the largest and oldest.

 

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