The economy, which is still not completely out of the woods,
has been impeding the growth of publishing companies, and
The Washington Post Company
) is no exception. The company recently entered into a deal to
sell its daily and Sunday newspaper,
, based in Everett, Wash., La Raza, to Black Press Ltd. and its
subsidiary Sound Publishing.
Soft economic conditions, along with waning advertising
demand, have been weighing upon this Zacks Rank #3 (Hold) stock's
performance, and compelled it to take the tough decision of
offloading the newspaper, along with its print and online
products, which it has owned since 1978. The amount of the
transaction was not disclosed, which is expected to conclude
early next month.
The Washington Post Company's newspaper division has long been
grappling, with revenue falling 7% to $419.6 million for the
first nine months of 2012, and registering an operating loss of
$56.3 million over the same time frame.
Earlier, the company had revealed its intention of shedding 2
shipping terminals in Alexandria and was seeking buyers to sell
its headquarters housed in Northwest Washington. It seems that
The Washington Post Company has been trying to shield itself from
the impact of an unstable market.
The New York Times Company
) is yet another example of publishing companies which are
shedding assets. The company completed the sale of About Group,
which it acquired in 2005, to
) for a consideration of $300 million, divested its remaining
stake (210 Class B units) in the Fenway Sports Group and sold
Regional Media Group.
The publishing industry has been struggling with sinking
advertising revenue for sometime now. This comes in the wake of a
longer-term secular decline as more readers are gradually
choosing free online news, thereby making the print-advertising
model increasingly irrelevant. To curb shrinking advertising
revenue and seek new revenue generating avenues, the publishing
companies contemplated charging readers for online content.
) has taken a leap toward an online subscription-based model for
general news content. The New York Times Company, on Mar 28,
2011, initiated a pricing system for NYTimes.com.
The newspaper companies are transforming their business models
to better position themselves in a multi-platform media universe.
Although the U.S. economy is witnessing a sluggish improvement in
the advertising environment, we believe 2013 is unlikely to mark
the resurrection of the publishing industry.
IAC/INTERACTIV (IACI): Free Stock Analysis
NEWS CORP INC-A (NWSA): Free Stock Analysis
NY TIMES A (NYT): Free Stock Analysis Report
WASHINGTON POST (WPO): Free Stock Analysis
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