AM: That’s fine, but if you looked at the classic newspaper model five years ago, say, 40 percent of newspaper advertising was from the classifieds. [The] industry had record high revenues in all categories in 2005 with $49.5 billion. By the end of this year, we will be down about 22 to 25 percent. I can show you where it went, it was mostly classifieds.

Now wait, it gets worse, because now the retail industry has completely collapsed. What happened last Friday? Circuit City went out of business. Linens-N-Things is out of business. Mervyn’s went out of business. Multi-store retailers like crazy are just vanishing from the scene. If the last two or three years were the years of want-ads going up in smoke, this is the year of retail ads going up in smoke.

Newspapers because of their high infrastructure costs can never drop their rates low enough to match the rate of the competing media like Craigslist at free or Google at five bucks a click. Newspapers have to have a different reason for people to buy than price. Has to be the quality of the audience that we attract.

TA: Basically you have this cyclical decline on top of this secular (structural) decline…

AM: The problem is the cyclical decline in this case, given the negative momentum we had going into it, may be so severe that some newspapers don’t come out the other side.

TA: With lots of newspapers probably going to go bankrupt this year, any idea how the restructuring process will work? Is there still a viable business model where they can come out of bankruptcy still putting out papers or at least stuff on the Web? You wrote about Lee for instance still having operating margins of 20 percent.

AM: If you’ve got a business that’s got a certain intrinsic value, lenders might be more willing to say let’s just liquidate the business and sell it and not restructure it. But the problem is, all these newspapers, there’s no end for them. If somebody doesn’t buy them, then you’re left trying to peddle a bunch of old presses and these crappy trucks and desks that reporters spit on and everything. There’s nothing there. This is a bad thing and it’s a good thing for newspapers. It’s a bad thing that newspapers don’t have that much intrinsic value. The good thing is the creditors really have to forebear much more. If there was really good stuff there, they could just go sell to some other guy.

TA: So they’ll have to write off more.

AM: What they’d rather do than take the writeoff is just kick the can down the road and hope everything comes out jelly-side up again. I’m not sure that many newspaper companies or individual newspapers will go out of business. The problem is when the newspaper can’t be cashflow positive in the moment.

So far as I know the Star Tribune (which is in bankruptcy protection), for instance, is actually making money on a day-to-day basis. The problem is they borrowed a lot of money in the expectation that sales would go higher and you could use those excess profits to pay down the debt. But the numbers are going the other way. If they didn’t have this debt, they’d be fine, and the same is the case for Lee.

What’s going to happen? The question is can the Star Tribune stay in the black on an operating basis? If they can, they can sort of dance through this until some better day comes. The minute, though, that they fail to be able to operate in the black and they need to ask for new money to make ends meet, I believe any creditor is going to say “No more money. You’re done.”

TA: What does the news landscape look like five years from now in 2014? Want to take a stab at that?

Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at