Russel Pergament's assault on New York City's ultracompetitive newspaper market is admirable for its audacity. Pergament is focusing on 18-to-34-year-olds, a segment that basically doesn't read newspapers. Last fall he launched amNewYork (circ. 209,000), a daily designed to attract the younger set by keeping news short and photos plentiful. It's free, it's small, and it's largely paid for by the Tribune Co., one of the nation's largest publishing companies. "What these kids like is fast, blather free and unbiased," he says. "Something to give them a good, comprehensive scan of the country in 20 minutes."
amNewYork is one of the latest bids in a broad effort to revive the newspaper industry after more than a decade of eroding circulation and closures. For years, papers have tried to attract gens X and Y with everything from hipper coverage to school partnerships to targeted pullout sections. Now several publishers are launching stand-alone papers with content tailored to the under-35 crowd, which tends to get its news from cable TV, websites and niche publications. According to a University of Chicago survey, fewer than a quarter of Americans ages 18 to 29 read a newspaper every day.
In recent months, newspapers from Belo Corp.'s Dallas Morning News to the Gannett Co.'s Wilmington (Del.) News Journal have rolled out separate, free tabloids to appeal to that missing demographic. Some, like the Washington Post Co.'s Express, appear daily and are newsy, boiled-down versions of the broadsheet. Others are weekly and focus more on entertainment and lifestyle, like Gannett's CiN Weekly in Cincinnati, Ohio, and Knight-Ridder's StreetMiami, produced by the Miami Herald.
"Our main goal is to create new generations of newspaper readers," says John O'Loughlin, general manager of the Chicago Tribune's RedEye edition, a youth-oriented daily that competes with the Chicago Sun-Times's Red Streak. The industry hopes to hook the kids now and eventually have them trade up to the marquee, paid product. In an early rumbling of that hoped-for switch, RedEye manages to sell about 15% of its copies at 25¢ apiece.
Industry analysts are unsure whether many young readers will ever convert to paying customers. But the analysts mostly agree that the freebies add value by increasing market share and attracting new, youth-seeking advertising dollars. The Tribune's RedEye (circ. 85,000), for example, has not turned a profit, but it has attracted 350 new advertisers to the Trib. Plus, since newspaper companies use existing assets like printing plants, journalists and distribution networks, the cost of added operations is incremental, says James Marsh, an analyst at SG Cowen Securities. Most of the free papers are break-even propositions for now.