Metroland Papers Going Online Only After Bankruptcy is Going to be Tough

Metroland newspapers are going online only. However, with the increasing news links blocking, this is going to be rough.

Late last week, Metroland entered bankruptcy protection. In the process, they stopped the print edition of numerous newspapers. Some information was published on STLawyers:

In a significant restructuring move, Metroland Media Group is laying off 605 employees and ending the print edition of its community newspapers, as it seeks creditor protection under the Bankruptcy and Insolvency Act.

Metroland is owned by NordStar Capital, which also owns the Toronto Star newspaper. The Toronto Star is not part of the restructuring.

More details: The terminations represent 60% of Metroland’s total workforce.

  • One third of the 605 employees losing their jobs work at the company’s flyer distribution operations. 501 of those workers are non-unionized, while the remaining 104 are unionized employees.
  • One third of the people being put out of work are part-time employees.
  • An FAQ prepared by Metroland says they will not provide severance pay because “the Company does not have sufficient funds” and that “Affected Employees will have the opportunity to file a claim in the course of the restructuring process for the amounts that they are owed.”
  • Metroland is exiting the flyer delivery business.
  • These decisions are driven by unsustainable financial losses attributed to changing consumer and advertiser preferences.

In a vacuum, the move to online only is a logical move. If a news business is struggling to pay the bill, you need to look at ways to cut costs. Axing the increasingly unsustainable print version of newspapers in light of the dominant digital world makes sense. A random search suggests that printing newspapers isn’t exactly cheap.

Many newspapers tend to do what is known as “spot colour” for printing which means that some pages are black and white while others are full colour. It’s a cost saving measure. What’s more, a reasonable distribution is about 10,000 copies in circulation. Make My Newspaper suggests that a price like that sets you back by $749 to make that happen. If you are a weekly newspaper, you can multiply that price by 4 or 5 on a per month basis which comes out to about $2,996 to $3,745 per month. Bi-weekly newspapers would work out to about $5,992 to $7,490.

Now, if we assume there is 20 to 21 weekdays for a daily newspapers, then this works out to about $14,980 to $15,729 per month.

Obviously, these are not hard and fast numbers because prices can depend on the printing operation in question, location. What’s more, this doesn’t even get into the cost of delivery all the way through this chain. The bottom line, however, is that printing isn’t exactly a cheap thing – especially when more and more people tend to get their news online. Sooner or later, something is going to break. In Metroland’s case, things did break business-wise as they move to online only.

Conversely, web hosting is significantly cheaper. You can very easily browse different hosts and see that the prices for businesses is significantly less. For instance, Gator Hosting is offering a business plan (as of now, anyway) of $6.25 per month. Dreamhost offers web hosting at $2.95 per month. Siteground is also offering $7.99 for web hosting (the plan that appear to make the most sense for a decent size newspaper. There are cheaper plans too).

Obviously, when you get into dedicated servers with better bells and whistles, you’ll find yourself going up in cost, but most offers out there certainly aren’t entering into 5 figures per month.

If you had to choose between print editions with an ever shrinking audience or an online presence where audiences are increasingly relying on web presences, the move is, well, obvious, from a business perspective. There’s loads of other considerations to consider as well.

Of course, this is all in a vacuum without taking into account what is going on with the laws in Canada. Thanks to the passage of Bill C-18, Meta had to make the business decision of blocking news links because paying publishers for the privilege of allowing them to post news links on their platforms to get free publicity is a complete non-starter. Google, for their part, are seemingly set to do the same thing at a later time, but are still trying to get the government’s attention to figure something out – with touch and go success as it turns out.

All of this presents an unusual problem for the Metroland papers going online: how do you build an audience when some of the largest websites won’t take your links because of a brain dead law that was passed? The lack of Facebook and Instragram is bad enough. The idea of potentially being unavailable on Google services is considerably worse. Yes, the newspapers are saving considerable money by going online, but they still need to be able to grow an audience to have a shot at surviving.

There are other platforms untainted by the Online News Act. Things like X/Twitter (assuming Elon Musk doesn’t put the whole platform behind a paywall, that is) and YouTube (print news to video content would be a considerable pivot) do exist. Still, the newspapers are hamstrung on the growth department thanks to a law the large media companies pushed for in the first place. The most awkward thing of all is that specialized news sites don’t have these restrictions in the first place. All of this isn’t even getting into the idea of trying to continue the legacy of the given newspapers that are making these moves in the first place.

Either way, the path forward for these newspapers are going to have a few additional mines in the way of staying alive that almost everyone else don’t have to face. To that, I say, good luck, you’re probably going to need it.

Drew Wilson on Twitter: @icecube85 and Facebook.

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