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Nov. 7, 2008, 4:53 p.m.

An opponent of newsroom cuts gets…cut

Mark Fitzgerald and Jennifer Saba of Editor & Publisher report that Goldman Sachs has laid off its media analyst, Peter Appert, as part of a 10% reduction in staff at the still-standing investment bank. That’s a shame, because Appert was among the few analysts who consistently criticized media companies for destroying their product by firing journalists. In the latest issue of our sister publication Nieman Reports, editor Melissa Ludtke highlighted a pressing question that Appert posed to the chief executive of A. H. Belo: “How do you maintain editorial relevance and quality as you are doing such dramatic cuts in staff?” And last month, Appert made this observation to The New York Times:

It just seems impossible to me that you’re cutting costs dramatically without having some impact on the editorial quality of your product. I can’t prove that this is driving circulation [down], but it’s certainly something that if I were a newspaper publisher would keep me up at night.

Appert has also been cautiously optimistic, if realistic, about the long-term prospects for print journalism, foreseeing “a glimmer of light at the end of the long transition tunnel.” Here’s what he wrote in a research note to investors last month:

Newspaper companies are NOT going out of business (although highly leveraged companies will face particularly acute challenges). Ultimately, we believe newspapers will re-emerge as healthy and dominant players in the local media marketplace as their business models evolve into a hybrid print and online offering. Margins, however, will be significantly below the 20%+ levels historically achieved, and it will likely take another five years before online revenues are sufficiently large to offset secular declines in the print business.

In July, Appert told Reuters: “If I covered only the newspaper industry, first of all I would have been fired a long time ago; secondly, I would have had to kill myself.” Now that Goldman has let him go, a smart media company would be wise to hire him as a consultant.

POSTED     Nov. 7, 2008, 4:53 p.m.
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