Hearst threatens to close historic 'San Francisco Chronicle'
Thursday 26 February 2009
San Francisco could become the biggest city in the US without a daily newspaper if the San Francisco Chronicle's owner, Hearst, follows through on a threat to shut its doors.
The historic newspaper company says the Chronicle's 1,500 staff must agree to deep cuts and at least scores of redundancies within the next few weeks if they want to save the paper.
The crisis in the US newspaper industry has accelerated in the past few weeks, as proprietors respond to a collapse in advertising revenue that has been compounding the longer-term problem of declining readership. Dozens of local titles are under threat of closure and two regional newspaper groups went bankrupt last weekend.
The San Francisco Chronicle would be by far the biggest casualty to date. It is the 12th most read paper in the US, serving the country's 14th largest city by population. Gavin Newsom, the San Francisco mayor, warned of the consequences of its closure. "The Chronicle plays an important role in our civic life and we don't want to see this treasured institution close its doors," he said.
Hearst, founded by the magnate William Randolph Hearst, says the Chronicle is losing $50m (£35m) a year. "Survival is the outcome we all want to achieve," the company's chief executive, Frank Bennack, said. "But without specific changes we are seeking across the entire Chronicle organisation, we will have no choice but to quickly seek a buyer for the Chronicle, and, should a buyer not be found, to shut down the newspaper."
The history of the Chronicle stretches back to the California gold rush, when San Francisco was growing rapidly. It was founded as the Daily Dramatic Chronicle in 1865, by teenage brothers.
A union meeting was being held yesterday to discuss the closure threat.
Across the US newspaper industry, advertising revenues are falling at a faster pace than at any point in 37 years, and owners have been scrambling to cut costs, axing dividends to shareholders and selling non-newspaper assets to pay off debt.
Philadelphia Newspapers, owner of the East Coast city's famous Philadelphia Inquirer, filed for bankruptcy on Sunday, after being overwhelmed by debt. The Journal Register Co, owner of the New Haven Register, had filed for bankruptcy protection the previous day.
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