Media Biz: Layoffs at NY Times, Washington Post are not a surprise

Newspapers were struggling before the economy slowed down and now that the recession has arrived they are in a death spiral. The Newspaper Association of America estimates total revenue will fall 5.5 percent this year, down from a drop of 11.5 percent last year. Some of the biggest and most well-respected papers, including The Philadelphia Inquirer, The Orange County Register and the Houston Chronicle, have seen circulation fall by 10 percent or more. In the fourth quarter, Gannett Co., the largest newspaper publisher, reported a 22.7 percent decline in advertising revenue.

Neither The New York Times (NYT) nor The Washington Post (WPO) has been immune to the industry's woes. Advertising revenue at the Times' parent company, whose properties include the Boston Globe, fell 15.7 percent in December. The Post, which gets most of its earnings from its Kaplan education division, reported an operating loss of $192.7 million in 2008 at its newspaper division. It will also lose money this year.