Let’s name names. The San Jose Mercury News is about the report a serious decline in circulation, according to E&P.;

Daily is down 9.4% and Sunday slipped 9.7%. Vice President of Circulation David Rounds said the paper has been cutting back on the other-paid category and that home-delivered copies increased this period. Rounds pointed out the paper is still feeling the effects of a single copy price hike.

You have to wonder which is more important to newspapers? Is it more important to retain circulation or to retain the money made from circulation? If your newspaper increases the cost of a single copy, it has decided that revenue is more important than readership.

Wrong decision.

Increasing the cost pushes newspapers toward serving only high-end customers. I’ve heard newspaper execs brag that they target the high-end customers advertisers want. This is pure rationalization.

What’s really happening is predicted in the “Innovator’s Dilemma.” The disruptive technology or business model always begins eating away at the low-end market. The traditional company responds by slowly gravitating toward serving high-end customers only. But eventually the disruptor starts peeling away the high-end market, as well. It’s a matter of time.

The best way to protect the high-end market is to stand and fight on the low end.