Lansing State Journal’s desperate race to a digital future

Consistency is typically considered a positive attribute for individuals and companies to achieve their goals. The Lansing State Journal, however, is experiencing an unwelcomed type of consistency: continued loss of daily and Sunday circulation and likely advertising revenue. 

The paper’s circulation started declining in 2005 and hasn’t stopped. As of September 2022, the average Monday–Saturday circulation was 8,994, including both print (6,631) and the digital replica edition (2,363), according to the Alliance for Audited Media, an independent nonprofit organization upon which many newspapers and other media have relied for decades for accurate reporting of circulation. A spokesperson said those numbers have not yet been audited.

That’s an 18.2% decrease from September 2021. Subscribers can only read the replica edition on Saturdays after the LSJ eliminated its print edition last year.

Sunday circulation declined 16.1% from a year ago to a total of 14,675 (print 12,646 and digital replica 2,029).

Two decades ago, the daily and Saturday papers circulated close to 80,000 copies and nearly 100,000 of the Sunday edition.

“Whatever the reason for the downsizing of the Lansing State Journal, it leaves me sad because I remember our robust coverage of Lansing City Hall as well as East Lansing City Hall. We reported important stories from the township suburbs,” said Mark Nixon, former editorial page editor at the Journal from 1993 to 2006.

“We were a presence in the wider community, but that presence is disappearing. I fear for the Lansing community and people’s ability to obtain important news. Many signs point to an increasing decline. I’m afraid the Journal will disappear.”

The circulation numbers tell the basic story, but the causes are varied and complicated. The most obvious source of the Lansing State Journal and other newspapers’ circulation problem is they are owned by Gannett, the largest newspaper publisher in the United States. It has experienced financial and operational difficulties since its acquisition by GateHouse Media in August 2019. Those difficulties have also been negatively consistent since then. The company reported a total loss of $54 million during its fiscal second quarter of 2022 against $749 million in total revenues. Print circulation and advertising and digital advertising didn’t generate expected revenues and labor costs and operational expenses increased significantly, including a 31% increase in the cost of newsprint within a year.

Gannett’s strategy, which applies to all its newspaper properties, including the Lansing State Journal, is to accelerate a transition from printed and delivered newspapers to digital news platforms. This is certainly the strategy of almost all newspaper companies of all sizes; however, few of them carry a comparative amount of Gannett’s reported $1.3 billion in debt (as of fall 2022).

Pursuing that strategy while servicing such a large debt load is an especially challenging situation for Gannett. It has all the hallmarks of a classic Catch-22 situation. As newspaper subscriptions and ad revenues decrease, it’s more difficult to service the debt — and Gannett is trying to transition from a print to a digital model, which requires large investments. 

“Cutting employees and costs at the same time Gannett is trying to grow digital subscriptions and digital revenue is a challenging combination,” said Tim Franklin, senior associate dean, professor and John M. Mutz Chair in Local News at Northwestern University/Medill and head of the Medill Local News Initiative. 

“You’re trying to convince news consumers to plunk down their credit card every month to pay for a digital subscription for unique, original, local content. If Gannett cuts too much too fast in its newsrooms, although they are trying to preserve them, and don’t transition efficiently from print to digital, then the risk is people will stop subscribing or not subscribe because they don’t see the value for them.”

For Gannett’s smaller properties, such as the Lansing State Journal, the Catch-22 has an even tighter grip. Undoubtedly, its professional, dedicated journalists are covering local news every day, but they are subject to Gannett’s corporate decisions, which are mostly based on the bottom line and stockholders’ interests. (Stephanie Angel, executive editor of the Lansing State Journal declined to comment for this article.)

“With fewer resources and increasing costs, it’s a challenge for papers to sustain a print edition while they’re also simultaneously tasked with completely reinventing their business and content distribution models,” said Erica Beshears Perel, director of the Center for Innovation and Sustainability in Local Media at the UNC Hussman School of Journalism and Media.

“Converting from a print to a digital mindset isn’t as easy as it might appear. You must think about content in a new way, especially for younger generations who consume information entirely differently.” 

The Lansing State Journal is not alone in facing the enormous challenge Gannett has presented to the company’s journalists, editors and other employees. 

• During spring 2022, Gannett close two of the 12 weeklies in the Lansing area, the Towne Courier in East Lansing and the Lansing News. 

• After eliminating approximately 400 jobs in its U.S. media division in August 2022, another 200 were presented with pink slips in late November, equivalent to 6% of the approximately 3,400 people working in the media division. It’s unclear if anyone in the newsroom was laid off at the Journal, but one reporter, Jared Weber, left about that time. Another, engagement editor Matt Hund, posted on Facebook that he left for the good of the company after Gannett asked for volunteers to move on. The Journal has been hard hit with layoffs over the last decade or more, so it may have escaped the latest round of pink slips.

• Gannett ceased operations of two of the four presses at its Indianapolis facility and 56 of the 145 employees will lose their jobs. 

• During January 2023, eight employees of the Detroit Free Press, another Gannett property, voluntarily quit, saving the 14 jobs of their co-workers who were about to be laid off. Editor Peter Bhatia was one of the eight, and many of the others are top reporters and editors. 

Despite the current crisis at the Lansing State Journal and all of Gannett’s media division, Perel shared an optimistic vision. 

“The news industry will have a future with legacy newspapers, which will still be doing important watchdog work and should be commended for that work. We will have student media, alt-weeklies, new digital platforms and news entrepreneurs filling the gaps,” explained Perel.

“This future will provide many more opportunities for diverse voices to be heard that have been excluded. Different types of storytelling will arise and more experimentation to report and distribute news. The benefits of the evolving news ecosystem are exciting.”