ALEX CHADWICK, host:
From NPR News it's Day to Day. Financial trouble at one of the most authoritative newspapers in the country. Today's second quarter report from The New York Times shows a drop in revenues and in profits, again. Marketplace's John Dimsdale joins us. John, how bad are things at the Times?
JOHN DIMSDALE: Well, they reported a 6 percent slide in their earnings, which is a lot worse than Wall Street was anticipating. And part of the decline was due to employee buyouts. Like many newspaper publishers, the Times is trimming its news staff, and that's ultimately going to cost the company about $40 million extra, this year alone. Also, ad revenue at the Times dropped 11 percent, and that's largely from a slowdown in classified ads. Longtime newspaper analyst John Morton says that reflects the sluggish economy we're in.
Mr. JOHN MORTON (Newspaper Analyst): The three major sources of classified are automotive, real estate and job formations. And all three of those sources are in a tailspin. It won't get better until those sources come back, and I don't think anybody anticipates that happening this year.
DIMSDALE: The chief executive at the Times, Janet Robinson, says that ads from airlines and hotel owners and car makers were also way down this past quarter.
CHADWICK: John, The New York Times has a very active online site as well. How about online advertising kind of balancing things out here?
DIMSDALE: Yes, there was, it was a healthy 13 percent jump in Internet revenue, but that's still a relatively small part of the paper's overall income. The increase in online ads is nowhere near as much as the paper's been losing in print ads. And the Internet, as you say, is really where the Times, and all newspapers, have to look for their future. Readers are moving there, newspapers are going to have to follow, but John Morton says management at newspapers aren't making the transition very smooth.
Mr. MORTON: Unfortunately, what a lot of newspaper companies are doing in the interim is cutting back on news staff, on content, at a time when the standing and brand name of newspapers is paramount in importance to succeeding on the Internet.
DIMSDALE: Morton says the industry is shooting itself in the foot by lowering its journalism standards, just when establishing a presence on the Internet will need strong news coverage to attract online readers, who have so many other choices.
CHADWICK: We're going to have more on that in a moment, but just give us the overall readership trends for printed newspapers now.
DIMSDALE: Yes, the old-style papers. They've been steadily declining for a long time, really, since the late 1980s. And the recent migration to online news is just cutting even more deeply into traditional subscriptions, with a corresponding drop in the advertising revenue for traditional newspapers.
CHADWICK: Thanks, John. John Dimsdale of Public Radio's daily business show, Marketplace.