A Major Print-Media Bankruptcy Is Likely in 2012, Voters Say

A major print-related company is likely to go bankrupt this year, according to the vast majority of voters in a Dead Tree Edition poll that ended tonight. The voters just can't agree on which company it will be.

Out of 743 voters, only 158 (21%) chose "None of the above" on the question of which four print-dependent U.S. companies would go belly up in 2012. Leading the pack was Barnes & Noble, with 227 votes -- which still means that 70% of the voters think it won't go bankrupt this year.

With 161 votes (21%), Quad/Graphics edged out Verso Paper (157 votes; 21%) for second place, with the U.S. Postal Service not far behind at 153 votes (20%).

A Surprise Leader in the Print-Media Bankruptcy Sweepstakes

Which would you rather own: paper mills, large printing plants, a leading e-tablet platform, or the U.S. postal system?

Here’s another way to look at it: Which of those assets does not have to contend with overcapacity in a shrinking market.

In both cases, I thought the answer overwhelmingly favored tablets, which is why the results so far of the current Dead Tree Edition poll (in the right column, just below the first ad) surprise me so much. The 30% of voters who think Barnes & Noble (owner of the Nook tablet platform) will go bankrupt this year is well ahead of the number voting for Quad/Graphics (23%; printing presses), the U.S. Postal Service (22%), and Verso (paper mills, 20%).

Update: Final poll results are at A Major Print-Media Bankruptcy Is Likely in 2012, Voters Say.

Financial markets seem to have pegged Verso as the most likely to succumb among the three private companies. Its market value has dropped precipitously in the past year, to 84% below its peak and less than 1/30th of annual revenue. B&N and Quad both have market values of about 1/10th their annual sales.

The comments about the article introducing the poll, both on this site and in various LinkedIn groups, are some of the best I’ve ever seen. I extended the voting deadline by a week to 3 p.m. Hawaii time (8 p.m. Eastern) this Tuesday because I find the comments and the voting so interesting. As they say in Chicago, vote early and vote often.

Here are some of the best comments:

Dear Print, We Print Buyers Now Want an Open Marriage

Don’t get us wrong, Print. We still love you. We might look at web pages and tablets, but there’s nothing like holding you in our hands.

We still prefer the beauty and permanence of Print to the ephemeral nature of digital media. Geez, did you see how that photo came out on the iPad? It’s gorgeous. It makes me realize that page in the Print edition was a little out of regis – Oh, where was I?

It’s just that you alone can no longer fulfill all of our career needs. We can’t merely flirt with other media; we need the freedom to get fully involved with them.

Margie Dana, founder of Print Buyers International and the godmother of print buyers everywhere, has been encouraging us to branch out into other media. In this video, she even says, “You’re not leaving Print. It’s Print and, not Print or.”

See, even our godmother says a ménage a trois with other media is OK.

“I for one am 'retooling’ my abilities to go with the times,” commented a print buyer named Paul recently to the Print Production Professionals group on LinkedIn. “This way I can produce work for print and web. I've got twenty years of career left and don't want to be a dinosaur.”

He was responding to a recent article quoting forecaster Roman Hohol as saying that print media soon “will become less relevant and more expensive.” (As if that weren’t bad enough, Hohol did a webinar last week in which he said, “We haven’t yet felt the impact of tablets” on print demand and that tablets “will be as revolutionary in the way we consume media as Gutenberg’s printing press was more than 500 years ago.” Oy vey.)

You have taught us so much, like how to manage workflows and how to carry out customized manufacturing processes. It turns out that producing Web pages, apps, emails, and Facebook pages needs better workflows than the disorganized new-media people can concoct. And building digital content is a lot like doing customized manufacturing, except we’re producing virtual things rather than physical things.

So while our bosses may hate you, especially your costs and long timelines, they love what we’ve learned from you. And we’ll keep trying to show everyone how sexy and up to date you are by slipping in QR codes and other gimmicks.

Thanks for understanding, Print. By the way, could you scoot over a bit? We’ve invited some friends from other media to join us here in bed.

We Already Have A Veterans Job Corps -- It's Called the Postal Service

Hours after a leading Congressman urged massive job cuts at the largest civilian employer of military veterans, President Obama proposed creation of a Veterans Job Corps.

"With the bipartisan support of this Congress, we are providing new tax credits to companies that hire vets," Obama said Tuesday night during his State of the Union address. "Michelle and Jill Biden have worked with American businesses to secure a pledge of 135,000 jobs for veterans and their families. And tonight, I’m proposing a Veterans Job Corps that will help our communities hire veterans as cops and firefighters, so that America is as strong as those who defend her."

Those 135,000 jobs don't quite equal the estimated number of vets who already work for the United States Postal Service.Veterans preference has long been part of USPS's hiring practices and culture, leading to approximately one-fourth of its current employees having military experience.

Catalyst Paper Muddies the Water With Its Clarification and Its 443-Word Sentence

Today’s public relations tip: If you’re trying to clarify your company’s financial status, make sure your pronouncements are clear and that you don’t make people wade through a 443-word sentence that only a lawyer could love, or understand.

Catalyst Paper has generally been a leader when it comes to corporate transparency, especially on environmental issues. (See Ecologomania and Printed Products. No, the term "ecologomania" never caught on.) But it left readers dazed and confused when it issued a press release on Jan. 18 about its proposed recapitalization agreement.

“Contrary to certain media reports this is not a bankruptcy proceeding,” the statement said. “Further information concerning the recapitalization is contained in the Agreement, a copy of which is available on SEDAR (www.sedar.com), EDGAR (www.sec.gov) and the company’s web page (www.catalystpaper.com).”

But good luck finding the agreement on any of those sites without a lot of searching and clicking. Those who bothered were almost immediately confronted by this monstrosity of a sentence:

Which of These 4 Print-Related Giants Is Headed for Bankruptcy? Cast Your Vote

It was one thing when weak companies like Borders and NewPage went Chapter 11 last year. But now the bankruptcy talk has spread to four print-related companies that once seemed invincible or eternal: the U.S. Postal Service, Barnes & Noble, Quad/Graphics, and Verso Paper.

Are things really so bad for print media that the companies we thought were victors of the competitive wars have now become victims? Dead Tree Edition isn't so sure, so we're turning to our readers to help us understand.

We have initiated a poll (in the right column, just below the first ad and above the "Popular Posts" listing), asking which, if any, of these four companies will end up in bankruptcy court during 2012. You may vote for more than one, or for "None of the above." In the early balloting, only 30% of the voters thought none of the four would face bankruptcy this year, while Verso and USPS were in a tight battle for the title of most likely to succumb.

Update: Final poll results are at A Major Print-Media Bankruptcy Is Likely in 2012, Voters Say. Additional commentary: A Surprise Leader in the Print-Media Bankruptcy Sweepstakes.

Here's a quick rundown of the candidates: 

Under Siege: The Outlook for Print Media Is Even Worse Than We Thought, Expert Says -- But Publishers May Prosper

If you think the internet revolution has been rough on print media, wait until you see what the tablet revolution does, a paper-industry forecaster says.

As if there weren’t enough gloom and doom in the paper and printing industries these days, Roman Hohol says tablets and other digital devices will depress the demand for printed media even faster than most forecasts predict. But the director of the marketing practice for Forest Industry Consulting also sees signs that the tablet revolution will benefit many publishers.

“I believe that most [paper] industry forecasts underestimate the impact of digital media on graphic paper demand, not wanting to appear too negative to their clients,” Hohol told Dead Tree Edition. “We have developed an outlook for our clients that is quite negative.”

Hohol will present that outlook in more detail during the Industry Intelligence webcast “How the mobile media revolution will impact global graphic paper demand”, which will air at 2 p.m. EST Thursday and be available for download thereafter. Hohol gave Dead Tree Edition a sneak peek at the webcast, including the three main reasons he believes the global publication-papers industry is “under siege”:

Ruling Will Boost Pulp Makers' Gains from Black Liquor Boondoggle

A favorable ruling from a Congressional committee will add millions more dollars to what U.S. pulp and paper companies gained from the infamous black liquor tax credits.

KapStone Paper and Packaging announced yesterday that the Joint Committee on Taxation had accepted its position that the $186 million in black liquor credits it earned in 2009 are not taxable income. As a result, it is claiming $63.6 million in "gross unrecognized tax benefits and accrued interest expense" -- and Deutsche Bank upgraded its stock from "Hold" to "Buy".

Pulp manufacturers exploited a loophole in a renewable-fuel tax credit program to gain at least $8 billion in direct payments from the federal government in 2009. The government "rewarded" them for burning black liquor, a pulp byproduct, to power their operations, which they would have done even without the tax credits.

"The 'black liquor' scandal is the most notorious recent instance of the pitfalls of congressional efforts to pick and subsidize winners," Michael J. Graetz, a tax law professor at Columbia University, wrote recently in Wired magazine.

Thrown Overboard: Publishers Feel Abandoned by the U.S. Postal Service

Until recently, Postal Service executives talked about periodicals as “the anchor in the mailbox.” But lately, says one publishing executive, it seems that “the USPS just tied us to the anchor and threw it overboard.”

With the demise of “Aunt Minnie mail” (personal letters), USPS officials talked about magazines and newspapers as the key to “the mailbox moment” when people excitedly check their mail. But in recent months publishers have grown increasingly nervous about their reliance on a nearly insolvent Postal Service that seems ready to jettison them, including a recent proposal to abolish the Periodicals class altogether.

“What’s a publisher to do when the mailbox is in danger of collapse?” the MPA (AKA The Association of Magazine Media) asks in a description of its Feb. 2 Postal Summit. The brochure  reflects what seems to be the entire magazine industry’s feelings about USPS these days -- and why publishers everywhere are saying, “How the hell do we get more of our subscribers switched over from print to the iPad, or the Nook, or whatever?”

No Such Thing as a Free Ounce: Does 'Second Ounce Free' Make Sense for USPS or for Mailers?

For the most part, mailers cheered when the U.S. Postal Service announced “Second Ounce Free” for bulk-mailed First Class letters. But guest columnist Robert W. Mitchell points out below that the pricing strategy is unlikely to be profitable for the Postal Service, is seemingly unfair to some mailers, and does not follow good pricing practices.

The average Jan. 22 increase in rates for all of First Class adheres to the inflation-based rate cap of just over 2%. That means the lower rates for presorted letters weighing between 1 and 2 ounces are being balanced out by higher-than-inflation increases for other types of First Class Mail.

Mitchell’s analysis makes the simplifying assumption that other bulk mailers are bearing the entire cost of Second Ounce Free. But it’s also possible that the high increases for parcels (10.9%), international (4.7%) and Forever Stamps (2.3%) are helping to bear the load.

USPS' Mess and NewPage's Saga: Dead Tree Edition's Best (and Worst) of 2011

Articles about the U.S. Postal Service’s struggles were the most-read features of Dead Tree Edition in 2011, while NewPage's downward spiral into bankruptcy protection was also a popular topic.

Once again, the 10 most popular articles were all about the Postal Service, led by USPS Retirement Mess: A Major Barrier to Downsizing and Obama Hints At Changes To Postal Service Workforce, each with nearly 20,000 page views. The irony is that many people mistakenly thought the first article was criticizing postal unions (I was actually praising them for addressing a problem that management seems to be ignoring.) and that nothing much has come of Obama’s hinting.

Readers actually spent the most time – nearly 1,000 hours – reading Postal Service, White House Engaged in 'Intense Discussions'. Nothing much seems to have come from those discussions, either.

The article receiving the most comments – a whopping 49 – was Postal Service Has Too Many Employees and Pays Them Too Much, Mailer Groups Say. A lot of postal employees wondered why USPS has so many supervisors, why they’re working overtime when there are supposedly too many workers, and why U.S. mailers are complaining about the best bulk postage rates in the world.

Tricky Dick, Spamazon, and 10 Other Media Failures of 2011

Now that just about everyone else is done publishing their annual feel-good "Best Of" lists, it's time for Dead Tree Edition to remind us what a crappy year we just stumbled through.  Here’s a look back at some of the media world’s unsung losers and overlooked failures of 2011:

Spamazon: Amazon, once known for its uncanny ability to send emails promoting just the right products to the right person (See An Amazon Approach to Selling Magazine Subscriptions), decided to enter the deal-of-the-day business. But it turns out the big web retailer is better at algorithms than maps: Several readers report being deluged with irrelevant offers, including ones for car washes, hair salons, and the like that are more than two hours from where they live. By the time Amazon realizes the damage it has done, I’ll bet millions of us customers will have relegated its missives to our spam folders.

Georgia: Forbes recently announced the launch of its 20th “local language edition”, Forbes Georgia. Yat's raht, them good ol’ boys in Jawjuh fahnly had to abandon WDCHYDIUN (We Don't Care How You Do It Up North) as a business strategy and realized they need someone to explain the ways of Wall Street and other Yankee business practices to them in their own language. (What? There’s a country called Georgia? Sheee-it, I thought Georgia rejoined the Union just a few years after the War Against Northern Aggression.)