Guy Farmer: When hedge funds buy newspapers
I’m pleased to report the Gannett Corporation, which publishes USA Today, the Reno Gazette Journal and more than 100 local newspapers around the country, earlier this month rejected a hostile takeover bid by Digital First Media, a subsidiary of rapacious hedge fund Alden Global Capital. That’s good news for those of us who still love print journalism. If Alden’s takeover bid had succeeded, it would have meant the death of many Gannett’s newspapers, maybe even the RGJ.
In a hard-hitting full-page article, four intrepid USA Today journalists last month wrote about what happened to the venerable Denver Post after Alden Global bought the paper in 2010. “In interviews with roughly a dozen journalists who experienced Alden’s takeover in Denver, a dire picture emerges of what happens when a hedge fund comes for the newspaper in your town,” they wrote. The USA Today reporters described personnel cuts, corporate meddling and “a stewardship that results in a newspaper becoming a shell of what it once was” with properties sold-off “at the expense of a newspaper’s prospects for long-term survival.”
Respected media analyst Ken Doctor told USA Today Alden “doesn’t reinvest in journalism or harbor any long-term survival strategy for the newspapers it owns.” He added if Alden had acquired Gannett it would have been “a capitulation to the inevitability of further decline toward closure at some point.” In other words, it would have been a death sentence.
Former Denver Post News Editor Larry Ryckman said Alden began its ownership of the paper by firing experienced journalists even though news is the product that sells newspapers. Layoffs and turnovers left only about 100 journalists in the newsroom — one-third of its staff during its heyday. “We were under attack by our own owners,” Ryckman said. When newspaper owners fire journalists they often fill space with “advertorials” — advertising disguised as news, which should embarrass all self-respecting journalists.
Unfortunately, this same sad story is occurring at community newspapers around the country. Colorado-based Swift Newspapers, which owns the Appeal and several other papers in northwestern Nevada, around Lake Tahoe and beyond, has been forced to downsize in order to remain afloat. As we know, the Appeal now publishes two print editions per week, on Wednesdays and Saturdays, and most other Swift papers in the region publish once a week. I was heartened recently, however, when new Sierra Nevada Media Group Publisher Rob Galloway told me he’ll do everything possible to keep the Appeal’s print editions alive. Along with many other longtime Appeal subscribers, I hope he succeeds.
“As audience has shifted to digital products, including online news, the unrelenting trend has ravaged profits from print circulation and advertising,” USA Today reported. That’s the sad reality of attempting to produce quality journalism in today’s national media market.
Part of the problem is competent editors are few and far between in 21st century journalism. For example, the “progressive” news website BuzzFeed published a false story claiming President Trump told his former personal attorney, Michael Cohen, to lie to Congress and the FBI. In a rare public statement, Special Prosecutor Robert Mueller denied the BuzzFeed story.
And then there’s “iPhone news” where someone shoots video and puts it on the Internet with no corroboration and no context. That happens when media outlets run raw footage from public demonstrations and/or pages from 30- or 40-year-old high school and college yearbooks with no rebuttal. This is “news?” I have a question: Where are the experienced editors?
As an old print journalist, I lament the demise of quality daily newspapers.
Guy W. Farmer, the Appeal’s senior political columnist, has worked in and around the newspaper business for more than 50 years.