U.S. law chief open to antitrust aid for newspapers

* Some newspapers already have limited antitrust immunity

By Randall Mikkelsen

WASHINGTON, March 18 U.S. Attorney General Eric Holder said on Wednesday preserving a healthy newspaper industry was important and he was open to adjusting antitrust policy if it could help.

"I'd like to think 20, 30, 40 years from now people will still be reading the newspaper," Holder told reporters.

He was responding to a call by House of Representatives Speaker Nancy Pelosi, urging the Justice Department to give newspapers more leeway to merge or combine operations.

The industry is reeling from declining circulation, economic recession and a shift in advertising and reader attention to online media. Venerable newspapers have closed or -- such as the Hearst Corp's Seattle Post-Intelligencer this week -- gone to Internet-only editions with reduced staff.

"I think it's important for this nation to maintain a healthy newspaper industry. So to the extent that we have to look at our enforcement policies and conform them to the realities that that industry faces, that's something that I'm going to be willing to do," Holder said.

Some struggling newspapers in multiple-newspaper cities have limited antitrust immunity under the 1970 Newspaper Preservation Act, allowing them to combine business activities while maintaining separate news operations.

Pelosi, a Democrat whose California district is served by Hearst's The San Francisco Chronicle, urged Holder to take a broad view of newspaper competitors under antitrust law and include "electronic and digital" outlets.

Such a view could make it easier for a paper such as the Chronicle to merge non-news operations with a company such as the Bay Area News Group, which owns papers in nearby San Jose and Oakland.

Newspaper defenders say online news outlets lack the resources and ambition of newspapers. "Our newspapers and news media must be able to engage in investigative journalism and to analyze significant issues, so citizens are informed of public policy issues and public officials are held accountable," Pelosi said in her letter to Holder.

Holder said he had not yet seen Pelosi's letter. He said he is a regular consumer of online news "on my computer and iPhone and all that."

"But I think that we need to have a healthy, vibrant newspaper industry, and I don't mean just online."

(Additional reporting by Richard Cowan; Editing by Eric Beech)