OMAHA, Neb., (Reuters) – Warren Buffett is fond of newspapers — he reads five a day — but the billionaire investor warned shareholders of his Berkshire Hathaway Inc that the reeling industry may never recover because it lacks a sustainable business model.
At Saturday’s annual meeting of Berkshire, which owns the Buffalo News and has a big stake in Washington Post Co, Buffett said that as readership falls, so does the attraction of newspapers for advertisers, and for investors in the companies that publish them.
“For most newspapers in the United States, we would not buy them at any price,” Buffett said. “They have the possibility of nearly unending losses. … I do not see anything on the horizon that sees that erosion coming to an end.”
Many U.S. newspapers have lost 20 percent or more of their advertising revenue as changes in technology and reading habits shrink circulation and more readers to get their news online.
Several newspapers in large U.S. cities have closed in recent months, and the future of the money-losing Boston Globe, owned by The New York Times Co, remains up in the air.
