Although the amount of regulation preventing newspaper monopolies has lessened, the government continues to monitor the declining number of newspapers in various American cities as well as mergers in cities where competition among papers might be endangered. In the mid-1920s, about five hundred American cities had two or more newspapers with separate owners. However, by 2010 fewer than fifteen cities had independent, competing papers.
In 1970, Congress passed the Newspaper Preservation Act, which enabled failing papers to continue operating through a joint operating agreement (JOA). Under a JOA, two competing papers keep separate news divisions while merging business and production operations for a period of years. Since the act’s passage, twenty-eight cities have adopted JOAs. In 2012, just six JOAs remained in place—in Charleston, West Virginia; Detroit; Fort Wayne, Indiana; Las Vegas; Salt Lake City; and York, Pennsylvania. Although JOAs and mergers have monopolistic tendencies, they sometimes have been the only way to maintain competition between newspapers.
For example, Detroit was one of the most competitive newspaper cities in the nation until 1989. The Detroit News and the Detroit Free Press, then owned by Gannett and Knight Ridder, respectively, both ranked among the ten most widely circulated papers in the country and sold their weekday editions for just fifteen cents a copy. Faced with declining revenue and increased costs, the papers’ managers asked for and received a JOA in 1989. But problems continued. Then, in 1995, a prolonged and bitter strike by several unions sharply reduced circulation, as the strikers formed a union-backed paper to compete against the existing newspapers. Many readers dropped their subscriptions to the Free Press and the News to support the strikers. Before the strike (and the rise of the Internet), Gannett and Knight Ridder had both reported profit margins of well over 15 percent on all their newspaper holdings.41 By 2010, Knight Ridder was out of the newspaper chain business, and neither Detroit paper ranked in the Top 20. In addition, the News and Free Press became the first major papers to stop daily home delivery for part of the week, instead directing readers to the Web or brief newsstand editions.