By Jeff Blumenthal – Reporter, Philadelphia Business Journal
The Philadelphia Inquirer has fewer than five years to make fundamental changes to its business, products, operations and culture or it risks financial peril, management told employees in a new strategic plan.
“The economic challenges of our industry and the dominance of the major tech platforms pose mortal threats to our long-term sustainability,” Inquirer management said. “At our current trajectory, we know that in five years we will be buried under a debt load that will be next to impossible to overcome.”
Management emailed the eight-page memo, entitled “Unlocking A New Era Of Inquirer Journalism,” to employees late last month while negotiating buyout packages as part of what it deemed necessary cost-cutting.
The Inquirer, which also operates the Daily News and Inquirer.com (formerly Philly.com), noted that the company was impacted more than some of its peers by “cataclysmic” changes in the news industry over the past 15 years due to its ownership turmoil. But with those issues in the rearview mirror, it has made what it described as meaningful changes such as merging three newsrooms into one, rebranding under the Inquirer name and introducing a digital subscription product.
But it admitted that it has largely failed to solidify its digital footprint, and the company’s quest for a viable business model remains elusive. So for the past four months, the senior leadership team has held weekly off-site meetings to identify a common vision, cultural changes and a sustainable business model.
“We need to make some tough but necessary decisions about the future of our print product,” management wrote. “We need to secure resources to invest in digital operations, and we need to attract new audiences with content that they are willing to pay for.”
Before getting into specifics about its plans, management provided its take on the newspaper industry, highlighting deep declines in print circulation and advertising revenue, with digital advertising revenue being insufficient to offset those trends. The response from newspaper companies has been cutting costs, largely through staff reductions such as those endured at The Inquirer in 2015, 2017 and just this month.
But the Inquirer said there are some bright spots amid the gloom, including digital consumer revenue, which is on the rise across the industry, philanthropic collaborations, and growth of an events business.
