Warren Buffett buys his hometown paper
Warren Buffett, chairman and CEO of Berkshire Hathaway, looks on while testifying before the Financial Crisis Inquiry Commission (FCIC) at The New School June 2, 2010 in New York City.
Kai Ryssdal: Warren Buffett has decided he wants to buy The World.
No, not this world. At least not today.
We're talking about the Omaha World Herald Company, which publishes seven local newspapers including Buffett's hometown daily of the same name. Buffett's holding company, Berkshire Hathaway, is going to put up $150 million to get the deal done.
It's a pretty surprising move. Buffett's made it clear he doesn't much believe in newspapers as an investment. Or maybe regional papers are more resilient than we think. Sally Herships has more.
Sally Herships: How does Craig Newmark sleep at night? That's what newspaper publishers ask themselves, right? The newspaper industry is dying and it's all the fault of sites like, well, Craigslist.
Peter Zollman: Because classifieds was the leading profit center for most newspapers, and it is no longer.
Peter Zollman is an advertising consultant. He says sites like Craigslist, Career Builder and Monster.com have hurt newspapers. But they certainly aren't killing them.
Zollman: Because believe it or not, despite what you've heard, newspaper advertising still works very well.
Ed Attorino: I don't think you see Macy's and stores on Craigslist.
Ed Attorino is a media analyst with the Benchmark Company. He says big publishers like Gannet, which own a lot of regional newspapers, are still making money.
Attorino: Still making a lot of money, as a matter of fact. Trouble is, it's making less money from quarter to quarter.
Attorino says the real problem for newspapers is shrinking circulation. They aren't attracting a lot of new readers and they're losing the older ones earlier. After all, newspapers used to be the place you went for news, and now there's a lot of competition.
But not for all news. Jim Goss is a media analyst with Barrington Research.
Jim Goss: The Omaha paper probably owns the Omaha content in a way that's not likely to be replicated by somebody out of Virginia.
And there's not much incentive for somebody from Topeka to cover Omaha. And keeping Omaha covered may be the real reason Buffett is buying the Omaha World.
In New York, I'm Sally Herships for Marketplace.