Finance History | One News Plaza, Buffalo, 15 April 1977 — A US$33 Million Newspaper Met Antitrust Law

On 15 April 1977, a Blue Chip Stamps subsidiary controlled by Warren Buffett closed the purchase of the Buffalo Evening News for approximately US$33 million in 1977 dollars. The buyer also assumed an estimated US$4 million of underfunded employee retirement obligations in 1977 dollars. The paper led Buffalo in weekday circulation and advertising, but it published no Sunday edition. That missing day threatened the franchise. Sunday papers carried distinctive features and valuable advertising, while reader habits were moving toward morning delivery, leaving the Evening News exposed to the Courier-Express and its established Sunday product. The new owners launched a Sunday edition late in 1977. The Courier-Express responded with a federal antitrust suit and obtained an injunction limiting promotional tactics around the launch. The legal dispute shows why a local newspaper's economics could not be separated from market structure. High fixed costs in news gathering and printing rewarded circulation scale, while advertisers valued reach, yet those same network effects placed a dominant publisher under antitrust scrutiny. In 1979, the United States Court of Appeals for the Second Circuit vacated the challenged orders. Its decision treated entry into Sunday publishing as competitive in itself and found the preliminary record insufficient to support the restrictions imposed below. The 17-month appeal period still damaged the business. Berkshire later reported circulation losses, heavy operating losses and a genuine risk that the paper could fail before its Sunday strategy took hold. The Courier-Express ceased publication in 1982, leaving the News as Buffalo's sole metropolitan daily. That outcome created strong local economics, but it also illustrated how a newspaper's value could depend on a narrow market with large civic consequences. One News Plaza anchors both sides of the episode. The building housed a durable local information franchise, while the litigation around its presses demonstrated that competitive advantage can bring legal obligations as well as pricing power. Photo: Fortunate4now, CC0, via Wikimedia Commons.