The New York Sun - Financial Problems, Circulation, and End of Print Run

Financial Problems, Circulation, and End of Print Run

The Sun was started up in 2002 in the face of the long-term decline of newspapers in the United States, the loss of advertising revenue to the Internet, and the rise of new media, and from the beginning faced a struggle for existence. It was the first new daily newspaper launched in New York since 1976, when News World Communications, a company controlled by the Unification Church, launched The News World (which was renamed the New York City Tribune in 1983 and folded in 1991).

At the time of its creation, one media financial analyst said the Sun's chances of survival were "pretty grim", while another media commentator characterized it as "the unlikeliest of propositions".

It was underfunded from the start, with ten investors putting up a total of only about $15 million. Beyond Conrad Black, who pulled out in 2003, these included hedge fund managers Michael Steinhardt and Bruce Kovner, private equity fund manager Thomas J. Tisch, and financier and think tank figure Roger Hertog. The Sun's physical plant, in the Cary Building at Church Street and Chambers Street in lower Manhattan, was antiquated, with malfunctioning telephones and computers, a trouble-prone elevator and fire alarm system, and dubious bathroom plumbing. Nevertheless, Lipsky had hopes of breaking even within the first year of operation.

The Audit Bureau of Circulations confirmed that in its first six months of publication the Sun had an average circulation of just under 18,000. By 2005 the paper reported an estimated circulation of 45,000. In December 2005, the Sun withdrew from the Audit Bureau of Circulations to join the Certified Audit of Circulations, whose other New York clients are the free papers The Village Voice and amNewYork, and began an aggressive campaign of free distribution in select neighborhoods.

While the Sun claimed "150,000 of New York City's Most Influential Readers Every Day", the Sun's own audit indicated that it was actually selling about 14,000 copies a day while giving away anywhere from 66,000 to 85,000 a day. (The New York Daily News sold about 700,000 copies a day during that period.) It offered free subscriptions for a full year to residents in advertiser-desired zip codes; indeed, this and other uses of controlled circulation made it more attractive to advertisers but further diminished its chances of ever becoming profitable. Similarly, the Sun's online edition was accessible for free since August 2006.

The Sun acquired the web address www.LatestPolitics.com in 2007.

In a letter to readers published on the front page of the September 4, 2008, edition, Lipsky announced that the paper had suffered substantial losses and would "cease publication at the end of September unless we succeed in our efforts to find additional financial backing." In particular, the paper's existing backers would not put forward more money unless new backers with capital were found. Whatever chance that funding had of materializing was negated by the rapid onset of the late-2000s financial crisis, and the Sun ceased publication on September 30, 2008. It had about 110 employees at that time, and also made use of many freelance writers. Mayor of New York Michael Bloomberg commented that "The Sun shone brightly, though too briefly," and that its writers were "smart, thoughtful, provocative".