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Ex-journalist Nancy Nall has as good a description as any I've read of what it's like to work for a small or medium-sized American newspaper on Election Day. She nails the details right down to the company-bought pizza in the newsroom.

Problem is, because I'm covering the City Council meeting so that Margaret, normally your intrepid city-government reporter, can report on the bond referenda, I'll be over at the Melvin Municipal Office Building and Nail Salon from about Pizza Minus 3 Hours until around 11.

This is tragic.

I’ve offered a bounty of free soda to anyone on the city desk who will save me four slices of Meat Lovers and/or Pepperoni 'n' Mushroom. The only response I got was from the government editor, Eddie Wooten, who’s running a marathon on Sunday and said he’d fight me for 'em because he's carb-loading.

Being reasonable, I said I’d rip his arm off and beat him over the head with it to get those slices. But I also pointed out that because he’d be lighter and be getting blood transfusions and IV fluids between now and Sunday as a result, his time should improve and so everyone's a winner.

For the first time since -- no kidding -- 1978, I'm going to be somewhere other than in a newsroom or in front of a TV on a federal-election night. Massive issues are at stake locally and nationally, and I’m gonna be in a room with no wireless [to clarify, the room might or might not have wireless -- I don't know -- but I almost certainly will not], listening to a discussion of the merits of Office-Institutional vs. Commercial. Granted, 360 or so nights out of the year I'm perfectly happy to do this because I'm a policy nerd like that. But Election Night is not one of those nights.

But that's why I get the big bucks. Or, as Nance says, "Small-market journalism is a study in self-debasement." Not that I wasn't already pretty debased before I even got into this racket.

That'd be U.S. newspaper circulation:

NEW YORK -- Daily circulation fell 2.8 percent at U.S. newspapers in the six-month period ending in September, an industry group reported Monday, the latest sign of struggle as newspapers try to hold on to paying readers.

Sunday circulation fell 3.4 percent in the same period, according to the Newspaper Association of America's calculations of data supplied by the Audit Bureau of Circulations.

The latest decline is in line with a long-term trend of falling circulation as newspapers battle with ever-increasing demands on readers' time as well as rapid changes in reading and advertising habits due to the growth of Internet use.

... New York's two fiercely competitive tabloids were the only papers in the top 20 to win circulation gains in the period. ...

Separately, the Newspaper Association of America also reported that, according to its analysis of online traffic data from Nielsen/NetRatings, nearly 57 million people visited newspaper Web sites in the third quarter, up 24 percent from the same period a year ago. That figure made up 37 percent of all Internet users.

This news comes as a number of us here review this blog post at Online Spin from Dave Morgan, chairman of Tacoda. He says, basically, that the battle is on, right now, for the local advertising dollar between local news organizations and giants such as Google and Yahoo ... and that about 95% of that market remains, for the moment, in play. His suggestions for how newspapers should respond:

• Expect ongoing 5% year-over-year drops in print revenue and ongoing 25% year-over-year increases in online revenue ... and allocate resources accordingly. Now.

(He seems to see little value in bringing print people over to online, which may be overkill (even Rob Curley started in print), but his point is that print is a drag on online at this point, culturally and perhaps also financially.)

• Make newspapers "the place where everything local is posted, shared, discussed, criticized, or mashed up." We're working on that, albeit at -- for me, at least -- a frustratingly slow pace.
• Make your site one-stop shopping for everything in your area, so as to be more attractive to advertisers. That doesn't mean you produce all the content, but it does mean you aggregate and link out like crazy: "Someone needs to aggregate every site and every page and every blog with any local connection onto local ad networks to create the kind of massive scale that advertisers want. This is already done on the national level; it should be done at the local level."

I'm not involved much with the business side of things, but I choose to be encouarged by the fact that this piece was sent to me by Kathy Lambeth, who oversees News & Record Interactive and is involved with the business side.

Now, I don't know whether these suggestions are too little, too much or just right. But they sound right, inasmuch as they 1) align generally with what our readers (particularly the more tech-savvy among them) have been asking us to do and 2) align with our own plotting and planning over the past couple of years. That doesn't mean he's right and it doesn't mean we're right, but it is an encouraging data point.

Well, yes and no, if journalism ethicist Ed Wasserman's Miami Herald column is to be believed:

... I'm interested in a related phenomenon, which has less to do with overall numbers than with a generational shift.

When you consider who is being discarded in the various waves of right-sizing that the news business has indulged in to keep its owners, if not its customers, satisfied, you stumble on the unsettling truth that the advance guard of an entire newsroom generation is being shown the door, 10 or 15 years before they would, in the normal course of things, have finished their working lives. ...

I had a conversation a year or two ago with an ex-reporter, who had long experience covering national security, about why his newspaper, one of the country's best, had fallen into lockstep in reporting credulously on the run-up to the Iraq war and had underplayed fierce dissent within our government. He said, essentially, that the coverage decisions were being made by people who weren't acquainted with the Gulf of Tonkin incident or the Iran-contra affair, or the other landmark late 20th century instances of official U.S. deceit or ineptitude. So they got snookered.

That was a disturbing answer. It made me realize that managing generational change is a delicate matter of achieving a balance of memory and energy, the seasoned and the fresh, certainty and skepticism. It's a matter not of lowering costs, but of carefully calibrating a newsroom culture. And it's a challenge that, I'm afraid, is being blown.

I'm more than a year into newsroom codgerdom being old enough to sue for age discrimination, should I be so moved. That's kind of sobering, inasmuch as I've been saying for a while now that 50 is the new 30, or at least the new 35.

On the other hand, I still think this Internet thingie is a passing fad, I still haven't figured out what "blugging" is and you kids need to get off my lawn.

So Hearst Corp., owner of one of the San Francisco papers, is providing a quarter-million dollars as part of MediaNews Group's billion-dollar purchase of the San Jose and Contra Costa papers. San Jose alum Dan Gillmor calls it "unnervingly close to a noncompete agreement," and absent further details I'd have to agree.

The arrangement might be similar to "joint operating agreements," federally sanctioned exceptions in antitrust law in which two financially struggling papers (with different owners) in a market combine business operations while maintaining competing newsrooms. But it is not the same thing, and if the government enforced antitrust law much anymore, I have no doubt this deal would be getting the kind of examination that would make a prostate exam feel like a quick stick-out-your-tongue in comparison.

John Weldes of the Pioneer-Press in St. Paul lists some things that prospective buyers of the newspaper should know.

You know how JR and I have been talking so much about better journalism here at the N&R? Turns out we've been wasting our time:

Analyst Ed Atorino of Benchmark Capital called high-quality journalism "almost irrelevant" to a newspaper's overall financial health. He said a paper should provide timely, interesting information without errors. "But does it have to be Pulitzer Prize-winning?" he asked. "No."

Atorino cited his former hometown's weekly newspaper, the Chatham (N.J.) Courier (circulation 3,000), which "covers local stuff: the Kiwanis, the football game, pictures of the 80-year-old lady that retired. You don't need 'quality' journalism. It's information. It's value.

"I think the whole idea of quality journalism is overrated," he said. "Pulitzer prizes haven't saved Knight Ridder, case in point. I'm sure from some perspective quality journalism is better than lousy journalism, but perfectly average journalism is fine."

Note to self: Move investments from Benchmark Capital BEFORE LUNCH.

Beyond that, where to start?

Well, let's start by scattering this implicit straw man to the four winds. As I've pointed out previously way too many times to bother linking to an example, news content very seldom drives circulation -- at least, it doesn't drive it very far or for very long on a day-to-day basis. (Note to the so-called newspaper-bidness analyst: That's why even small newspapers have circulation departments.) I don't know if I ever heard what our single-copy numbers were on 9/11/01 or the next day, but prior to that, our highest-ever sales of extra single copies was on the first day of the 1991 Gulf War, when we sold about 1,000 papers more than we normally would have expected to sell. At the time, the paper retailed for a quarter, so that's a whopping $2,500 in windfall revenue, less than we were getting even then for a full-page ad running for a single day.

(If you've ever accused the N&R of publishing a story "just to sell papers," go back and read that paragraph again.)

No, quality journalism doesn't sell papers on a day-to-day basis. What it does do is build up the paper's standing in the community as an independent, trustworthy source of news and information and as, by extension, a good place to advertise. That standing isn't just a warm feeling in my tummy. Accountants call it "good will," and although it certainly is intangible, it constitutes a large majority of the market value of a newspaper in most cases. (Which is another fact of which this "analyst" shouldn't have to be reminded.)

So just remember that if somebody in the financial industry tells you that average journalism is just fine, he probably has a stock he's trying to sell you.

Morgan Stanley Investment Management to New York Times Co.: "Little pig, little pig, let me in!"

(Whether the Times Co. has replied, either by saying "Not by the hair of my chinny-chin-chin!" or by saying something else entirely, TheStreet.com sayeth not.)

So the McClatchy chain is buying the Knight Ridder newspaper chain, making McClatchy the nation's second-largest chain (behind Gannett). For those of us in the Carolinas, this deal affects The Charlotte Observer, The State in Columbia and The Sun News in Myrtle Beach, among other properties. (The News & Observer in Raleigh was purchased by McClatchy several years ago.)

On the surface, this was, I guess you could say, the least-bad outcome for many of the 32 Knight Ridder properties involved: McClatchy is a publicly traded corporation, but it has a reputation for journalistic excellence and for not being absolutely bloodthirsty about its profit margins. It also is saying, at least for now, that while it will be looking for efficiencies, it will not be laying anyone off. I talked to a longtime acquaintance of mine in The Charlotte Observer's newsroom yesterday, and he said the newsroom was the happiest he had seen it in a long time.

But 12 of the KR papers will be resold -- primarily papers in markets such as Philadelphia that McClatchy doesn't see as growing fast enough to suit it. The St. Paul, Minn., Pioneer Press will be sold because of antitrust concerns related to McClatchy's ownership of the Minneapolis Star-Tribune. (McClatchy probably would have preferred simply to close it so that it could enjoy an effective monopoly in the Twin Cities and boost its ad rates, but those same antitrust concerns probably would preclude doing so.) But also going on the block is the San Jose Mercury News, the erstwhile Knight Ridder flagship, as well as the Contra Costa, Calif., paper. It's not clear to me why the Merc is being resold. True, ad revenue took a hard hit during the dot-com bust and its current margins now hover around 8% -- low for the industry. But, as analyst John Morton points out, it serves some of the wealthiest demographics in the country and a market that almost certainly will grow vigorously in the long term. Perhaps it has to do with McClatchy's already owning papers in Modesto and Sacramento. I don't know.

I'm no expert analyst, but if I had to guess, I'd say the future is both cloudier and, probably, grimmer for staffers at the 12 papers being resold. Those papers are going to have to fetch a premium to satisfy McClatchy (and help it pay down some of its debt, including $2 billion in Knight Ridder debt it assumed as part of the takeover). Thus it is likely that anyone who buys those papers will be cutting expenses big-time to make his own deal work, unless they take those papers private to avoid the kind of market pressures that undid Knight Ridder. But even going private likely would require a ton of debt. I think the best a lot of folks at those papers can hope for is a generous buyout offer, and I see no particular reason to think even that is in the offing.

The Knight Ridder sale was put into motion in November, when KR's largest shareholder, Private Capital Management, demanded that KR do something about its stock price, then $52 a share. Under the terms of the McClatchy deal, PCM will be getting $67.50 a share -- a 30% profit for four months of other people's work.

It would be nice to think PCM head Bruce Sherman will be satisfied with that. But, as The Blogging Journalist points out, Sherman also is McClatchy's largest shareholder, at 35.6%. McClatchy's price dropped about 3%, down $1.51 to $51.55, on Monday, and has lost almost 13% so far this year. Might Sherman make McClatchy the same "offer" he made KR?

UPDATE: Here's a roundup of other people's takes on all this, including some pure speculation that, if it came to pass, would be really interesting.

UPDATE: Wow. Former Philly ad exec Brian Tierney says he has commitments "in excess of $100 million" in an effort to buy Philadelphia's Inquirer and Daily News from McClatchey. The plan would be "a sort of Green Bay Packers kind of ownership," he says -- that National Football League franchise is owned by shareholders, almost all of them Green Bay residents, while other franchises are owned by individuals or small partnerships -- and would even partner with the Newspaper Guild, the union, to make it happen. I could spend a day listing the obstacles in the path of this plan, but if Tierney's group can pull it off, I think a lot of people in and around Philly would be very, very happy.