As the newspaper companies fight the online ad wars in trenches that seem less and less defensible, an old “new” weapon is resurfacing. Free newspapers. Big-city free dailies began surfacing in 1995 when “Metro” debuted on the Stockholm subways. Metro itself took off in various European capitals and a few American cities. Some American dailies (the Washington Post, Chicago Tribune, Newsday, Dallas Morning News) have moved in recent years to publish their own free dailies, distributed usually on public transport and targeting non-daily readers. By one estimate (http://users, .fmg.uva.nl/pbakker/freedailies/ ), it’s a global phenomenon seeing 21 million daily free copies distributed in 35 countries. The biggest news to emerge recently has been the growing plans of billionaire Philip Anschutz, conservative Qwest founder, who bought the S.F. Examiner more than year ago. He recently announced the new start up Baltimore Examiner – target daily circ of 250,000. That paper, to launch next year, will go up against the Tribune Company’s Baltimore Sun. Anschutz’s plans make much use of regional efficiencies as the Balto paper will share as many expenses with the his recently acquired (formerly Journal papers) DC area papers, now free and now “Examiners.” Most to the point, he has now trademarked, shades of Citizen Kane himself, the Examiner name in 69 cities around the USA. So what’s going on here? Lots of things of course. If you look at the Anschutz model, it’s not terribly different than a business struggle we’re all (painfully) aware of – the airlines. As the big carriers spoked and hubbed themselves to seemingly eternal multi-billionaire losses, upstarts reinvented the airline cost structure game. So think of Anschutz as SWA or Jet Blue against the T-K-Gs (Tribune, Knight-Ridder, Gannett) of the world. Look at some of the places he’s cutting costs: • Non-union staffs with younger staff making significantly lower salaries; • Outsourced distribution (thru local mag dist agencies) • Little expense of online operations, as his main online presence is a PDF replica newspaper, produced by technology, not FTEs. • Centralized production and printing within adjacent metro areas (like D.C./Baltimore) • Centralized copy, news desks within adjacent metro areas (like D.C./Baltimore) • Tighter “newsholes”, providing shorter stories for people on the go It’s an economic model that may be problematic up against healthy full-run, full-bore daily newspapers. But with those papers themselves buffeted by online-induced revenue upheavals, declining single-copy and subscription numbers and a younger public disaffected by being preached to by the Voice of God, these newspaper markets suddenly seem more vulnerable. Do free newspapers work? Do they bring in new advertisers and/or new readers? Or do they just cannibalize existing print audiences? The evidence is really too new to be definitive. Check out a good piece by Michael Stoll in “Grade the News” (http://www.gradethenews.org/2005/freepapers2.htm). Stoll provides some good regional context of what the free daily phenomenon means in the Bay Area. He looks at the battle between the shrinking paid Chronicle and the growing free Examiner, in San Francisco, noting how the Examiner there is now targeting upper-demo household delivery. He also talks about Knight Ridder’s purchase of free dailies in the highly competitive, high demo Peninsula area between San Francisco and KR’s Mercury News San Jose base, and how the cost equation – especially labor – is playing out. It’s well and good to cast these “micro-dailies” as “news lite”, but clearly as reader/user and advertiser markets splinter, media choices become more numerous. All the more reason for the big newspaper companies to get busier on two fronts: 1) faster time-to-market innovation, online and off; 2) prudent, effective cost-cutting that doesn’t impair its very basis to maintain the business.