According to a recent Reuters report, Warren Buffet cautioned his Berkshire Hathway company’s shareholders that the ailing newspaper industry may never ever recover since it is suffering from diminished customer interest due to a near total shift towards checking out news and business deals on the Internet.

"For most newspapers in the United States, we would not buy them at any price," said Buffett. "They have the possibility of nearly unending losses. ... I do not see anything on the horizon that sees that erosion coming to an end."

Buffet indicated, the report adds, that with an evaporating customer base, the focus of advertisers move towards media and technologies that currently hold customer’s interests and so does their revenue stream. As a logical consequence, the same holds true for newspaper industry investors.

"Twenty, thirty years ago, they were a product that had pricing power that was essential," said Buffett. "They have lost that essential nature."

For example, TMCnet earlier reported that the number of online digital coupon users in 2008 rose by fifty percent from 2007, and this coincided with the US newspaper industry going through a rough phase, which correspondingly translates to a reduction in the number of newspaper coupons being cut out and availed.

The TMCnet report added that coupons, via its website, enabled all its 36 million customers, collectively, to save over US $ 300 million in 2008 – a 140 percent steep climb when compared with 2007. This works out to an average savings of US $ 2000 per consumer per year – a healthy tonic for these troubled times. The target for 2009 is estimated at US $ 1 billion - a more than 333 percent projected increase from 2008.

With respect to Berkshire Hathway’s own newspaper, the Buffalo News, possibly closing down, Buffet reportedly said, “"On an economic basis you should sell this business. I said I agree 100 percent but I am not going to do it. The union has been cooperative in having an economic model that will at least give us a little bit of money."

TMC (News - Alert) has done fairly exhaustive and detailed reportage on the newspaper industry’s downward trend. One TMC article explores the possibility of newspapers going extinct. The logic being simple – if a print edition is charged for, and same thing is also printed free on the Internet, consumers obviously opt for the free stuff. Another TMC report cites “Newspaper convention cancelled amid industry woes”. A third TMC article discusses staff downsizing by the Times Union due to diminishing business.

All, however, is not lost for the entire print industry. TMCnet reported that Yellow Pages Association highlighted people still refer to the Yellow Pages – the printed media - while making purchases and that 91 percent of stores, warehouses or retail outlets where products are finally bought are mentioned in the related referenced Yellow Pages ads. 

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