Newspaper Stocks Surge As Their Own News Improves
Not all of that revenue is likely to return to newspapers, even if the U.S. economy is finally out of the recession. While the economy exacerbated newspapers' misery, it's only part of the problem.
Even before the downturn, readers and advertisers were shifting to the Internet. Newspapers have been trying to sell more online ads, but those efforts have yet to offset the losses because Internet advertising rates are so much lower than print.
Some Web sites like Craigslist don't even charge for most classified ads, drying up one of newspapers' biggest sources of cash.
Newspapers are bringing in a little more money by asking their readers to pay more. Some newspapers, like Gannett's USA Today, are now charging $1 for a weekday edition.But circulation figures indicate many readers are giving up the print edition rather than accept the price increases ¿ probably because they can read the paper online for free. Some publishers are drawing up plans to charge for parts of their Web sites. At least it now appears newspaper publishers have more breathing room to figure out their next move ¿ as long as advertising revenue doesn't drop any further.
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