I agree with Steve Cavendish's column in The Washington Post. Corporate greed and hedge funds are a clear and present danger to journalism. Other than big daily newspapers like the Post and New York Times, the wave of the future is likely to be non-profits.
I agree, Gannett is no paradigm of journalism. It instituted the 15 inch story and USA Today, a/k/a McPaper, with newspaper boxes designed to resemble televisions, and local newspapers with pretty layouts and empty of investigative reporting. If a hedge fund buys Gannett, it will get worse.
I have fond memories of the Tennessean when John Seigenthaler was President and Publisher.
It was a happier, healthier time, when my late friend and mentor, Nat Caldwell was chief investigative reporter, a time when the Tennessean fearlessly reported and investigated.
Pulitzer Prize winning investigative reporter Nat Caldwell dreaded the Gannett takeover of the Tennessean and died broken hearted.
From The Washington Post:
Outlook Perspective
Local newspapers have already been gutted. There’s nothing left to cut.
The ugly future of corporate news
The headquarters of Gannett Co. Inc. in McLean, Va. A hedge fund has made an unsolicited offer to buy the newspaper company. (Andrew Harrer/Bloomberg)
Wednesday was a bloodbath for journalists. BuzzFeed said it would lay off 15 percent of its employees, and Verizon Media announced it would cut 7 percent from its newsrooms at HuffPost, AOL and Yahoo. Worst of all, a wave of layoffs tore through Gannett newsrooms across the country that day, hitting staffs that had already been thinned by years of nearly annual cuts. In December, Gannett’s USA Today Network president, Maribel Wadsworth, told her employees that the nation’s largest-circulation newspaper chain “will be a smaller company” in the future and, well, the future is now. Wadsworth is facing a lot of pressures: Print revenue is down, digital and mobile revenue aren’t nearly enough, and now a hedge fund promising even deeper cuts wants to acquire the company. If the future of corporate news operations looks bleak, that’s because it is.
In Tennessee, we’ve been watching the slow-motion destruction of our news institutions under Gannett for a few decades now, and the idea that things are about to get even worse is appalling. As badly as the country needs strong coverage of national news these days, the local news landscape is important, too. And what happened here mirrors what’s already happened in city after city.
The Nashville I grew up in was a two-newspaper town, home to a daily slugfest between the scrappy afternoon Nashville Banner and the larger morning Tennessean. For 91 years, the papers dueled with talented staffs that featured heavyweights like John Seigenthaler, Fred Russell and David Halberstam, and owners who loved sending those reporters to brawl over their favorite politicians and causes.
Both papers had their problems as well as successes, but the competition was healthy for a growing region. The papers fought for scoops, launched deep investigations into corruption, covered the institutions the city was built on and told the stories of its citizens. They gave readers a choice.
Then began the great unwinding. The Banner’s owners sold the paper in 1998 to Gannett, the Tennessean’s owner, for $65 million, and the chain immediately closed the Banner and absorbed about one-third of its staff into the morning paper, giving it a robust newsroom of about 180 journalists. The Banner’s archives were donated to the city’s downtown library, and the trademark was allowed to lapse, another afternoon publication consigned to history.
Since then, the Tennessean’s newsroom has been slashed more than 60 percent. Barely 70 journalists remain to cover a city that has grown by more than 20 percent since the sale and a region that’s grown by roughly 50 percent. Middle Tennessee has an economy of nearly 2 million people fueled by health care, music, auto manufacturing and a multibillion-dollar tourism industry — and the state’s largest news organization is a shell of itself, and cut more staff this past week.
It’s rare to find a year in the past decade when Gannett did not offer some sort of buyout or impose layoffs in places such as Cincinnati, Indianapolis, Tallahassee and Phoenix. Forced to take a machete to their payrolls, editors throughout the chain did what their Nashville counterparts were forced to do: eliminate positions, consolidate beats, cut editors and proofreaders, and ship production work off to distant corporate hubs that function like boiler rooms. Advertising and circulation haven’t escaped the ax, either. Want to buy an ad? You’re more likely to talk to someone in a call center in New Jersey than a sales rep in your city.
Those cuts continue to reverberate.
Gannett bought up many of the small papers around Nashville and minimized or eliminated them, rolling them into the Tennessean’s “brand” like something out of Star Trek. The company acquired dailies in Memphis and Knoxville to control three of the four biggest markets in the state, a strategy targeted at advertisers more than readers. With most of the state’s major news outlets, Gannett eliminated redundancy, which is great if you’re counting widgets but awful if you want, say, more than one reporter covering a statewide campaign for governor.
And now stories go unreported. In July, for example, local hospital operators LifePoint Health and RCCH HealthCare Partners merged in a nearly $6 billion deal that affected roughly 1,000 local employees. The Tennessean covered the story with an Associated Press dispatch written in New York, followed by a local rewrite of a news release at the end of the day. There was no follow-up coverage despite LifePoint’s founder receiving a $70 million exit package and 250 jobs getting eliminated.
How did this happen? Years of erosion have damaged the paper’s ability to cover the community. This is true everywhere: Since 1990, nearly 65 percent of all newspaper jobs have been eliminated, more than in the fishing, steel or coal industries.
As bleak as all of this sounds, the butcher’s butcher is waiting. This month, Alden Capital tendered an offer to buy Gannett for $12 a share, a 23 percent premium above the price where it was trading. The hedge fund made news last year with draconian cuts at the Denver Post and other papers in its Digital First Media chain. A lawsuit alleges that Alden siphoned off millions from its newspapers to make up for losses from risky investments.
Gannett is ripe for a hedge fund raid, because cost containment has been the company’s only successful strategy for years. On the print side, Gannett is actively alienating its core readership — still its most valuable source of revenue — by reducing pages, cutting features and moving up deadlines so that virtually nothing that happens after 6 p.m. makes the next day’s paper. That includes sports scores, city council meetings and major news: When Nashville holds local elections this year, those results won’t make it into print for two days.
On the digital side, Tennessean managers say they don’t measure employee performance based on page views, yet staff members tell me they are instructed to scan Twitter and Facebook trends and write stories that capture traffic from social media. The company’s digital strategy is less about serving an audience and more about rolling every digital click possible into a pile and trying to monetize it. That attitude manifests itself in stories crammed with so many ads that they’re hard to read, autoplay video that people angrily rush to turn off and giant ad takeover campaigns that alienate visitors. And yet, if Alden is successful in its bid, we might look back on these as the good times.
So what is the right response if your largest local news organization is firmly in corporate crosshairs? “I say to everyone, ‘Gannett made the Daily Memphian possible,’ ” says Eric Barnes, the president and executive editor of the newest media outlet in Memphis. Barnes and a group of local journalists and civic leaders, concerned about the decay of the Commercial Appeal under Gannett, formed a 501(c)(3) nonprofit, raised $6.7 million and launched the Daily Memphian as an online-only news site in September. Its staff of 30 is almost as big as the Commercial Appeal’s now that Gannett has shrunk the paper.
The Daily Memphian plans to use donor money as a kind of philanthropic venture capital, giving it several years to achieve fiscal sustainability. It’s a model my colleagues and I plan to follow this year when we relaunch the Nashville Banner online under the umbrella of the newly formed Nashville Public Media. We’ve learned by now that leaving local news in the hands of shareholders will only get us less.
The nonprofit route, pioneered by outlets like the Texas Tribune, emphasizes generating most revenue directly from audiences through paywalls or membership. It’s attractive because the local revenue model for Gannett, Digital First and other big newspaper chains is irrevocably broken. Unless you have the scale of The Washington Post or the New York Times, the print advertising dollars that newspapers are hemorrhaging are being replaced by digital dimes or even pennies.
All over America, we need something different: We need more reporters covering the issues that matter to our communities. We need to stem the crisis in statehouse reporting; here in Nashville, the Capitol Hill press corps has dwindled from 35 to just 10 over a few decades. We need more investigative power to follow the billions of dollars spent by state and local governments, often with little oversight. We need competition in places where corporate news has carved out monopolies and let local news wither.
And we need to do it fast, because the butchers are sharpening their knives.
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