Want to buy a used newspaper?

A few days ago, Baltimore Brew posted a short article on the possibility that a federal bankruptcy court might take management of the Tribune Company away from Sam Zell, concluding with an assertion, presented without evidence, that anyone but Zell would be an improvement.

This exercise in speculation also talked about the possibility of a return of The Baltimore Sun to local ownership.

Few of the discussions in Baltimore in recent years about a breakup of Tribune that would lead to transfer of The Sun to local ownership have gone into detail about the realities. While I have no specialized knowledge about the inner financial workings of Tribune or The Sun, and would sooner attempt to manage a professional baseball team than undertake ownership of a daily newspaper, I have questions about the feasibility of such a change. Have you looked under the hood?

The Tribune Company, like the other media conglomerates, has pursued cost savings through economies of scale, such as negotiation for lower newsprint prices than an individual paper could get. It has also consolidated a number of operations, such as payroll, human resources, and information technology, sharply reducing the number of employees at the constituent newspapers. Would a new owner find it necessary to hire additional staff to conduct these operations, or contract them out at some expense?

Moreover, the individual Tribune papers’ computer systems are linked to centralized servers. Would a new owner have the capital to invest in computer equipment? For that matter, would a new owner have the capital to invest in any technological improvements?

A new owner would have to buy the name, the physical property, and the goodwill, probably with borrowed money, paying off the debt through revenues. But the sickening drop in revenues is the main reason for the substantial reductions of staff, in the newsroom and elsewhere. Would the revenues be enough to pay off the debt, or would a new owner have to make ever further cost-cutting reductions in product and staff?

It is hard for me to shed the apprehension that any group of banks taking over the Tribune Company from Mr. Zell, or any local owner buying The Sun from a dismembered Tribune Company, could well wind up presiding over an even more drastic diminution of the operation.

The problem is not a lack of readers but a lack of revenue. The panelists and audience attending the Abell Symposium earlier this month on the survival of local news had lots of ideas about what newspapers could and should do.

But nobody could suggest where any substantial amount of money would come from.