The sorry state of the American press

A battle between two titles in San Francisco highlights a crisis in newspapers all over the US
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Anyone wanting an insight into the panicked state of newspaper publishing in the United States could do worse than attend the court hearings currently under way in San Francisco in which the owners of the city's two main papers, The Chronicle and The Examiner, have been slugging it out over who should have the right to buy out whom.

It's been quite a spectacle. In the first few days of the case, one newspaper publisher has admitted using his editorial pages to trade political favours with San Francisco's mayor - an act of professional suicide that has resulted in him being put on indefinite leave from his job.

A rival publisher, meanwhile, has admitted making statements under oath that he could not substantiate - prompting the Oakland Tribune to print the damaging headline: "Chronicle CEO Admits Perjury".

Add to the mix a disgruntled political consultant, with more axes to grind than a galley-full of Vikings; the looming presence of the all-mighty Hearst Corporation; an ambitious Asian family business appropriately named the Fangs; and a thrice-weekly free news-sheet curiously named The Independent (no relation) that may nor may not end up becoming part of the configuration in San Francisco's journalistic future, and you have the very definition of a spectacular media farce.

The details of the dispute take some figuring out, and are to some degree the by-product of San Francisco's propensity for high political theatrics. But at heart they illuminate a crisis afflicting newspaper markets across the country: namely, that it is becoming almost impossible for any city - no matter how big, or affluent, or educated, or blessed with journalistic talents - to support more than one newspaper.

While The Chronicle and The Examiner lock horns in San Francisco, battle is being joined in Seattle between The Times and The Post -Intelligencer to capture what is increasingly being seen as a city with room for just one of them. Honolulu, meanwhile, almost lost its second newspaper to a secret deal seven months ago and only clung on to it thanks to a hastily organised court action that has just come up with a complex plan to keep both the Advertiser and the Star-Bulletin alive.

And that is not to mention the dozen or so cities that have lost their second newspapers over the past couple of decades, or the major metropolises like Boston, Los Angeles or Washington DC where the competition between local titles is so lop-sided as to be little more than token.

The root problems will come as little surprise: dwindling readership, lower standards and increasing competition from local television, cable, 24-hour rolling news stations, alternative weeklies, magazines and the internet. Perhaps more surprising is the way the survival mechanisms put into place over the past 30 years are creaking to a halt.

San Francisco, Seattle and Honolulu are among a dozen cities to have dreamed up a newspaper life-support system called a Joint Operating Agreement. Essentially, this means that two titles otherwise unable to continue competing pool their production and distribution costs and split the combined proceeds of their operation. The only thing that makes them two newspapers is their editorial staffs, but since one paper tends to come out in the morning and the other in the afternoon, there is a lot of repetition.

This is the system that has been in place in San Francisco since the mid-Sixties. The Examiner was once the flagship of the Hearst media empire and was run by the founding family until the Seventies. But recently, as an afternoon newspaper, it has dwindled into insignificance with barely more than 100,000 copies sold each day (the presence of Phil Bronstein, aka Mr Sharon Stone, as executive editor notwithstanding). Rather than let its San Francisco interests die, Hearst announced its intention last summer to buy up The Chronicle, the morning paper that has a circulation more than four times as wide.

At first it seemed that the two papers would merge, but a bevy of anti-trust lawyers and various interest groups ensured Hearst's life would not be made quite that easy. The courts ruled late last year that The Examiner would have to be sold to another media group as part of the deal. The big question was: who could possibly want to take it over, particularly since the Joint Operation Agreement with The Chronicle, which alone guarantees its financial viability, is due to expire in 2005?

One man who came forward was Clint Reilly, an insurance millionaire, political consultant and regular candidate for mayor of San Francisco, who fancied he could use the paper to sock it to his political nemesis, Mayor Willie Brown, and set himself up for a successful election campaign. He also had a personal score to settle: six years ago, Phil Bronstein broke his ankle in an argument over election coverage.

Hearst wasn't interested in Reilly's offer, and decided instead to sell to the Fangs whose only other media interest is the distinctly lightweight, little-respected Independent. "Sell" was perhaps too grand a word for the transaction, which envisaged the Fangs not only gaining control of The Examiner but also enjoying a $66m (£41m) subsidy from the Hearst Corporation for their pains.

Reilly, among others, quickly smelled a rat, and suspected this was a scheme to drive The Examiner out of business as quickly as possible and leave a Hearst-run Chronicle as the only game in town. Several commentators also thought they saw the hand of Mayor Brown in the deal, since the Fangs have been staunch supporters of the mayor's.

Clint Reilly decided to challenge the sale in court; hence the current hearings, which have proven so juicy that they have been reported with glee even in the newspapers involved in the dispute.

On the very first day, The Examiner's publisher Timothy White admitted offering Mayor Brown favourable coverage on his editorial pages if, in exchange, Brown would support Hearst's proposed buy-out of The Chronicle. White's testimony was immediately disowned by his superiors, who put him on indefinite leave.

The juicy details have kept coming: Chronicle Publishing president John Sias's perjury gaffe, testimony about the millions the Fangs stand to gain personally from the Examiner deal, and more.

Whatever the outcome of this particular struggle, the long-term outcome seems clear: San Francisco will become a one-newspaper town, as will Seattle and Honolulu and any number of other cities. Economically, there is no durable alternative. A country that prides itself on the diversity of its fourth estate seems condemned to ever more blandness in its local newspaper markets.

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