Tribune Faces New Test

McClatchy, on the other hand, has gone ahead with a large consolidation play. It clearly believes in the benefits of newspaper ownership, as its recent purchase of Knight Ridder for $6.5 billion suggests. That sale was made possible by the tub-thumping of Pacific Capital Management's Bruce Sherman. McClatchy has since turned around and sold a dozen Knight Ridder papers for $2 billion to help pay for the acquisition.

Gannett, which also owns TV stations, along with a slew of regional print properties and USA Today, has seen its fortunes in the market decline in recent times. Gannett has a more diversified list of smaller investors who don't seem to have the leverage to apply pressure on management to induce significant change.

Overall, investors this week will be looking for daylight on spring performance at these companies and any glimmer of hope looking forward. But growth, the issue that is central to these old-media companies, is likely to be modest at best.

In a newspaper industry second-quarter preview, Merrill analyst Lauren Rich Fine said she expects weak fundamentals to continue. "We are forecasting 1% ad revenue growth in the second quarter across our coverage universe," Fine writes. Merrill does business with the companies mentioned. "As better-than-expected May results were seemingly offset by a weaker June, we do not anticipate the companies having any degree of conviction on second-half trends."

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