Death spiral?
Circulation continues to plummet at MaineToday Media’s newspapers

by Al Diamon

For fans of print journalism, the latest circulation figures for Maine’s major daily newspapers don’t offer much in the way of good news. According to the U.S. Postal Service “Statements of Ownership, Management and Circulation” for the year ending Sept. 30, 2013, the state’s largest papers all lost readers, with MaineToday Media’s flagship publications, the Portland Press Herald and Maine Sunday Telegram, showing the most stunning declines.

In 2012, the Telegram sold an average of 73,301 copies each week, according to its USPS report, which is required in order to get a second-class mailing permit. In 2013, that number was down to 63,148, a decline of 14 percent. That’s the sharpest drop since 2010, when the Sunday paper lost over 18 percent of its sales compared to the year before. In the last five years, the Telegram has shed more than a third of its circulation.

This year’s falling-off-the-cliff numbers represent a shift from the past couple of Postal Service reports, which offered more encouraging statistics. The Telegram actually gained over 3,000 readers between 2010 and 2011, in part due to drastic discounts offered to home subscribers that boosted the numbers by about 4 percent. But even when those deals ended in 2012, the loss was modest, less than 5 percent (just over 4,000 copies), which seemed to indicate the paper had survived the worst and its continuing decline had finally bottomed out. In addition, in the past two years, the Sunday paper has expanded its reporting staff and beefed up its coverage, offering more investigative pieces and in-depth analysis. These new figures don’t seem to indicate much public interest in that increased quality.

There were indications earlier this year that the numbers wouldn’t be positive. The Alliance for Audited Media (formerly the Audit Bureau of Circulations) reported in April that Telegram sales were down 13 percent from the previous year. The AAM uses different criteria for determining paid circulation than does the Postal Service, but both reports tend to agree on general direction. A new Alliance report is expected to be released in late November.

The Press Herald showed results similar to the Telegram’s in its USPS report. After losing 7 percent of its readers between 2011 and 2012, the trend accelerated in the past 12 months. The Portland daily has fallen off by 11 percent since last year, a loss of over 5,200 copies a day. It now sells a daily average of 40,858, about two-thirds of its paid circulation in 2008.

For the second year in a row, that leaves the Press Herald slightly behind the Bangor Daily News for bragging rights as the state’s largest daily paper. Or, to put that dubious honor in context, as the biggest paper that’s dying the least quickly. Because of differences in the rules (the Postal Service averages Monday-through-Saturday circulation, which includes the Bangor Daily’s weekend edition, while the AAM counts Monday-through-Friday numbers and lists weekend and Sunday papers separately) the Press Herald still holds the top spot in the AAM ratings, at least until the new figures come out later this month.

Regardless of who’s number one, the Bangor paper has little to celebrate. In the past year, it lost 9 percent of its average daily circulation, down 4,012 copies to 42,195. That follows a 5 percent loss between 2011 and 2012. Over the last five years, the Bangor Daily has seen circulation decline more than 26 percent.

The nearest thing to good news that can be found in the USPS reports concerns the Lewiston Sun Journal. The daily edition sold an average of 31,369 papers during the past year, a drop of 8 percent from 2012. That doesn’t sound all that positive until it’s put in context. Because the Sun Journal reported increases in newspaper sales each of the previous three years, the five-year change in its numbers is less than one-third of 1 percent, a decline of just over 100 copies.

Likewise, the Lewiston paper’s Sunday edition, down about 15 percent in the past 12 months, mostly gave back the gains it made in 2010, 2011 and 2012. Since 2008, the paper’s average sales are off only 3 percent, to 30,450.

The Sun Journal doesn’t subscribe to the AAM service, so there’s no second source to verify its modest success. But in 2012, Mainebiz magazine put its daily circulation at about 25,000 copies (that number appeared in a sidebar to the print version of this story that isn’t posted online), much lower than the figure reported to the USPS, but more in line with the drop-offs experienced by its competition. I remain skeptical that the Lewiston paper, which produces a limited amount of enterprise reporting and relies heavily on the Bangor Daily for much of its state news, is performing significantly better than other Maine papers.

Management at many of these publications has routinely dismissed doom-and-gloom speculation that the continuing heavy circulation losses will soon spell the end of their enterprises. They argue that increases in online readership more than offset the drop in purchases of the dead-tree edition. But none of them dare to be so brazen as to claim online advertising is making up for the loss of print ads. A national study released in 2012 indicates digital ad sales amount to just one-seventh of the amount lost in paper-and-ink advertising sales.

MaineToday is compensating for that only because its ownership has deep pockets and no pressing need to make a profit. Other papers are cutting costs and desperately hoping somebody (hello, Jeff Bezos) finds a magic formula to boost online revenue before it’s too late.

One footnote to the Postal Service filing for MaineToday Media: Since the form requires a listing not only of circulation, but also of ownership, one might think it would help clear up who or what holds a stake in the company. As has been previously reported, hedge fund manager S. Donald Sussman owns 75 percent of MTM, and the News Guild of Maine, the largest union at MaineToday, controls a significant (but unspecified) portion of the remaining quarter. But if there are other stakeholders, neither the company nor the Postal Service report is saying. The USPS only requires filers to disclose those to whom the papers owe significant debt. In MaineToday’s case, that’s Citizen’s Bank of Manchester, N.H., which helped finance former CEO Richard Connor’s purchase of the company in 2009 and is still hanging around long after Connor’s ouster over financial irregularities.

The exact composition of MTM’s board remains a mystery for reasons that are equally mysterious.

Maybe those involved don’t want to be publicly identified as guiding a sinking ship.

In addition to serving as The Bollard’s media critic, Al Diamon writes a weekly political column that runs in the Portland Phoenix, the Downeast Coastal Press, the Daily Bulldog, some Mainely Media weeklies and some Current Publishing papers. He also writes columns for a couple of Current’s magazines. He can be emailed at aldiamon@herniahill.net.