The closing of the Rocky Mountain News in the United States has unleashed another wave of newspaper obituaries. Let’s separate fact from fiction.

In the United States, the economics of a labour-intensive metropolitan daily reliant on print classified advertising and distributed to a vast exurban geography will force “second newspapers” in local markets to close. Meanwhile, newspapers that chose not to slim down operations in good times, through inaction or union intransigence, may consider closing instead of confronting the disorientation of cultural vertigo – peering over the cliff and cutting staff by half at one time.

Let’s be clear here. This means a U.S. metropolitan market is not big enough to support more than one kind of 20th century-style publishing behemoth – a peculiar entity on the world stage that falls squarely in the “more affected” category. Most markets in the world can handle several such entities. In the United States, smaller, nimbler digital news operations will likely emerge with reverse publishing on profitable days the likely model that fits the market.

Newspapers that are at risk in today’s economy were marginally profitable entering today’s economic downturn. The recession is merely the tipping point.

The vast majority of U.S. newspapers were financially strong entering the downturn, and today’s challenges are scalable.

The bigger issue is whether the surviving newspapers are able to implement transformation agendas simultaneous to managing the downturn. Failure to do so would be a much bigger tragedy for the newspaper industry than the closing of financially marginal newspapers.

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