Why newspapers are buyout targets

WHY NEWSPAPERS ARE BUYOUT TARGETS
[SOURCE: The Christian Science Monitor, AUTHOR: Ron Scherer]
Even for America's newspaper families, the media oligarchies that control many of the nation's broadsheets, the economics of continuing to publish a newspaper is challenging. Circulation is hard to maintain when information is free on the Internet. Meanwhile, there are fewer and fewer department stores, which are traditional advertisers in big city papers. And within the newspaper families themselves, an increasing number of members want to diversify their assets, as they try to get a better return on their investment. For some families, one solution has been a sale. From a pure business standpoint, the Murdoch bid of $5 billion, or $60 a share, might make sense for News Corp., whose media empire includes Fox Broadcasting. This fall, Fox plans to roll out a business news channel to compete with CNBC. Ownership of Dow Jones would thus give Fox access to reporters and information. If Mr. Murdoch or another media company were to take over Dow Jones, some worry that it would mean yet more concentration in the industry. "We're seeing a decline in the commitment of resources for doing journalism," says Bob McChesney, professor of communications at the University of Illinois at Urbana-Champaign. Mark Crispin Miller, who teaches media, culture, and communications at New York University, notes that some members of Congress are worried about this trend. But, he adds, "No one will go near it."
http://www.csmonitor.com/2007/0503/p03s02-usec.html