San Francisco May Lose Its Main Paper

The owner of the San Francisco Chronicle says if it can't reduce expenses dramatically soon, it will close or sell the newspaper. Hearst Corp. has made it clear that the cost-cutting will require a significant number of layoffs at Northern California's largest newspaper.

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After losing more than $50 million last year, the Hearst Corporation may sell or shut down its main newspaper: The San Francisco Chronicle. That's unless there are major job concessions from unions within weeks. NPR's David Folkenflik reports.

DAVID FOLKENFLIK: When Hearst shed the smaller San Francisco Examiner and bought the dominant Chronicle in 2000, the media company thought it had finally won control of the market. But the paper has been weighed down by union contracts, the collapse of income from classified advertising and the burst of the dot-com bubble.

Mr. ROBERT ROSENTHAL (Former Managing Editor, San Francisco Chronicle): This is arguably one of the great cosmopolitan and sophisticated markets in the world, and yet the business model for the Chronicle has been broken for years.

FOLKENFLIK: Robert Rosenthal was managing editor of the Chronicle from 2002 until 2007. And he doesn't mince words about the state of the larger industry, either.

Mr. ROSENTHAL: We're in a crisis. And I think the next few years there will be solutions, but right now nobody has one.

FOLKENFLIK: Hearst is a private corporation, insulated from Wall Street. But the recession changed the rules. Hearst is already seeking a buyer for the Seattle Post-Intelligencer. And other publishers are reeling, too. The Scripps Company is trying to sell the Rocky Mountain News in Denver. The Philadelphia Inquirer, The Minneapolis Star Tribune and The Entire Tribune Company have filed for bankruptcy protection. And on a single day last fall, the owners of the Star-Ledger in Newark, New Jersey brought out 45 percent of its news staff. The alternative, as in San Francisco, would have been to shut down or sell the paper.

David Folkenflik, NPR News.

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