Elton John and Bernie Taupin might have to consider rewriting “Philadelphia Freedom.”

Brian Tierney, chief executive of the company that owns The Philadelphia Inquirer and Daily News, plans to begin charging for news online by the end of the year, he said in an interview with a local Fox TV affiliate.

“I think by the end of this year we’ll starting doing what a lot of other newspapers are looking at doing and charging something for it,” Tierney said. “We can’t spend $53 million on newsroom costs and give it away on the back door in terms of things. There will be a small charge for that.”

When asked by Fox 29’s Steve Keeley when such a charge would go into effect, Tierney said “by the end of the year.”

Tierney also said he plans to take on Google over possibly getting money for Philadelphia Media Holdings from its content that resides on the search engine’s site.

Tierney discarded a move to an online-only product, saying that his company needed print journalists to be profitable. He also said he expected to be printing newspapers for the next 20 years.

Lots of newspapers are trying to find ways to get people to pay for the news that they put online, but so many papers have offered free Web access for so long that no one is sure that anyone will keep coming to the sites.

The upside: They might make some more money if people feel like they can’t get the news they need and want anywhere else. The downside: If fewer people start visiting the website, advertisers will start demanding cheaper rates online. And it’s not like people will necessarily go back to the print edition either. Print ad sales are plummeting because people are going online for news, and there’s no guarantee that people will reacquire a print habit if they decide that they don’t want to reach for their wallets every time they log on.

On the other hand, newspapers don’t have a lot of options. In the case of the Philly papers, Tierney’s company is going through Chapter 11 bankruptcy reorganization proceedings. With the company’s life on the line and a $53 million newsroom to run, what’s the harm in trying?

And here’s one other thing to think about: Newspaper publishers are loath to discuss whether and how to charge. If they show up in a room and do that, they run the risk of being accused of collusion by the Justice Department. Should one or two papers do it, and then another paper should happen to start doing the same thing… where’s the proof of bad behavior? Prepare to see more of this, and soon.

(Photo: Philadelphia’s William Penn shows off his Hockey colors. Reuters)

The 24/7 Wall Street blog’s list of newspapers that it teed up as going out of business this year is making a certain group of people rather unhappy — the people who run those papers. Two of them are so hopping mad that they have aired their complaints to the public.

You can read the whole list on 24/7 Wall Street, but here is what it said about:

New York Daily News:

NY Daily News is one of several large papers fighting for circulation and advertising in the New York City area. Unlike The New York Times, New York Post, Newsday, and Newark Star Ledger, the Daily News is not owned by a larger organization. Real estate billionaire Mort Zuckerman owns the paper. Based on figures from other big dailies it could easily lose $60 million or $70 million and has no chance of recovering from that level

And the Philadelphia Daily News:

The Philadelphia Daily News. The smaller of the two papers owned by The Philadelphia Newspapers LLC, which recently filed for bankruptcy. The parent company says it will make money this year, but with newspaper advertising still falling sharply, the city cannot support two papers and the Dally News has a daily circulation of only about 100,000. The tabloid has a small staff, most of whom could probably stay on at Philly.com, the web operation for both of the city dailies.

New York Daily News Editor Marc Kramer unloaded on the blog and Editor Doug McIntyre, as you can see in this story in his big rival, the New York Post (which must have enjoyed the writeup).

Brian Tierney, who runs the Philadelphia papers, put his skills as a seasoned public releations executive to work and issued this press release:

On Monday, March 9, 2009, Time.com posted a blog entry titled, The 10 Most Endangered Newspapers in America, which included the Philadelphia Daily News at the top of its list. First, let me say that I like catchy Top 10 lists as much as the next guy, but the Daily News is not going anywhere. It is beloved by its readers for its Philly attitude toward sports, entertainment and politics. I agree with my good friend, Marc Kramer at the New York Daily News (also on the list) who called the report, ‘unfounded and baseless.’ The fact that this “report” can get such widespread coverage is a case study in why we need to preserve institutions like The Daily News, which has reporters who actually call sources and editors who actually check facts. If we hold up this type of blog “reporting” as journalism, God save our democracy.

The blog had a number of wrong assumptions and factual errors. First, The Daily News is profitable. Our newspapers made $36 million last year. The Daily News is the 91st largest newspaper in America in the fourth largest media market. There is ample room for two newspapers in Philadelphia. Second, the blog assumed The Daily News journalists could be absorbed into philly.com. The Daily News has 107 journalists. It would be quite a squeeze to get them all into the philly.com offices, where we have about 10 content producers. Maybe they could share chairs and desks?

The public needs and expects journalism to be accurate and factually correct. To do otherwise is a disservice to them.

At least he didn’t say that bloggers aren’t journalists. That’s a step toward the future!

(Photo: Reuters)

Brian Tierney doesn’t dispute that U.S. newspapers are in trouble; he just wants to know why they can’t tell the good side of the story. That led to this article in today’s Philadelphia Inquirer, the paper he owns along with a group of investors:

The pundits and cynics who believe that newspapers are dead are dead wrong.

So says a small group of newspaper executives who this month organized an ad hoc group to alter perceptions and get the facts out…  Dubbed the Newspaper Project, the grassroots effort includes the CEO and publisher of Philadelphia Media Holdings, Brian P. Tierney. [And executives from Parade, Community Newspaper Holdings Inc and others --ed]

Acknowledging that the newspaper industry faces challenges, the group roundly rejects the notion that newspapers have no future.

The group decided “because journalism is so essential for a democracy, we really need to tell this story ourselves in a more aggressive way,” Tierney said.

Starting on Monday, the Newspaper Project will launch an ad campaign in the Inquirer, The Washington Post, The New York Times, AdAge and other papers to spread the word. It’s a good fit for Tierney, who knows a thing or two about public relations. Of course, it’s also something that the Newspaper Association of America has spent millions on over the past few years, and that has yet to turn the tide of public opinion.

As the Reuters reporter who covers newspapers, I was nonplussed to only find out about this on the Saturday before the campaign launched, and said so on a comment on the Inky’s article. An hour or two later, I got a call from Tierney. That led to a chat about three fundamental facts about the state of newspapers today:

• Yes, they’re more read than ever, thanks to the Internet
• Ad budgets are falling in print, and online ad sales are too cheap to make up the difference
• A publisher might be profitable, but not enough to pay off debt, which raises the possibility of default, bankruptcy and extinction.

We covered the basics of the campaign and he touted how well the Daily News and Inquirer are doing in terms of Web audiences. But what about bringing in more money? Perhaps charging for the paper online (see Silicon Alley Insider for the latest free-vs-paid chapter) is inevitable, he said.

And how are he and his investors dealing with the papers’ debt, now at $400 million?

“We put 30 percent equity into our deal, which at the time seemed sufficient. Last year we did almost $40 million EBITDA [earnings before interest, taxes, depreciation and amortization], but our debt service is $40 million also, so we’re in kind of a covenant default. So the equity takes a haircut… and some of that debt needs to be significantly restructured… But the debt story does get in the way of the audience story.”

Tierney hopes to get the debt restructuring sorted out with lenders within a few months. As for injecting more cash into the two papers? “Our investor group is willing to put in more equity under the right terms,” he said. “No one in our investor group thought this was going to be a Google return.”

And advertising? It’s chiefly because of the decline in ad revenue that papers are struggling. At the Inquirer and Daily News, ad revenue performance was down about 17 percent over the past year. Factoring in circulation revenue gains from raising the papers’ price, overall  revenue was off 10 percent in 2008. Ad revenue likely will fall the same amount this year, he said.

There’s no cause to celebrate a second year of 17-percent ad declines. On the other hand, it’s the kind of consistency that suggests that a bottom could be near. And a bottom usually is what precedes some kind of recovery. That sort of trend is its own public relations campaign.

(Photo: Reuters)

Monday brings a fresh wave of despair to the newspaper world as sagacious authors in various media outlets let us know that the economy and the neglect of good citizens are threatening the survival of print journalism.

First up is media columnist David Carr in the New York Times, who wrote on Monday about Sam Zell, Brian Tierney and OhSang Kwon, all of whom bought into papers and have found out that the old devils aren’t what they used to be:

The industry may not be touching bottom any time soon. Last year, overall newspaper revenues dropped by about 7 percent, pushed along primarily by the secular change of readers and advertisers fleeing to the Web. And publishing, along with many other kinds of businesses, is now staring at a full-bore recession, led by the credit crisis that is fanning out across the economy.

Staple the secular and cyclical changes together and most newspapers will be staring at double-digit drops in revenue: one analyst I talked to put the figure at 15 percent. It’s clear from their rhetoric and recent moves that highly leveraged players like Mr. Tierney, the partners in Avista and Mr. Zell will have a tough time meeting their obligations.

Over at The New Yorker, Eric Alterman notes that Craigslist is creating a “palpable sense of doom” among newspaper publishers, and hauls out the usual hobgoblins (“prized journalistic possessions are suddenly looking like corporate millstones,” “the mood these days is funereal,” “Few believe that newspapers in their current form will survive,” “budget cuts, bureau closings, buyouts, layoffs and reductions in page size and column inches,” etc.) as a lengthy lead-in to a story about the Huffington Post and its revolutionary ways of presenting the news. As one of its co-founders says in the story, it’s a “shared enterprise between its producer and its consumer.”

There you have it, newspaper publishers, you’re just not as much of a “shared enterprise.” Survival is that simple.

(Photo: Reuters File)