By Dan Kennedy • The press, politics, technology, culture and other passions

A mountain of debt

Not that it should be any surprise, but Christopher Rowland’s take on Greater Boston’s newest newspaper behemoth is pretty chilling for anyone who cares about community journalism.

Writing in the Boston Globe, Rowland reports that Fairport, N.Y-based GateHouse Media — which, earlier this year, paid $410 million for the Boston Herald’s Community Newspaper Co. (CNC) as well as the Patriot Ledger of Quincy, the Enterprise of Brockton and those two papers’ affiliated MPG weeklies — has been built on a mountain of debt.

Boston University’s Lou Ureneck tells Rowland:

They’ve been piling up debt in order to grow. The danger from a public point of view is that the debt burden gets so high that the company begins to drastically reduce its expenditures on the coverage of news.

On Saturday, the Herald’s Jesse Noyes reported that GateHouse would likely cut jobs as it consolidates operations on the South Shore. (The Herald continues to have a content-sharing arrangement with its former CNC subsidiary.)

There have been suggestions that Kirk Davis, the chief executive for GateHouse’s 100-plus papers in Eastern Massachusetts, sees Web-based community journalism as the future. Wicked Local, a Plymouth site started by the Ledger/Enterprise chain before its acquisition by GateHouse, is seen as a model.

Wicked Local is indeed pretty intriguing. But there is no substitute for investing in local reporting.

To be sure, no one can blame GateHouse for paring down its overlapping operations on the South Shore, where in some towns the company now finds itself owning competing weeklies. Nothing terrible has happened yet. The company is also going public, which will allow it to raise investment money.

But this is an experiment in corporate giantism at the local level that bears close scrutiny.

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  1. Anonymous

    But isn’t this kind of corporate giant, which is created by the gobbling up of smaller newspaper companies, exactly what’s wrong with Massachusetts newspapers? North Shore Weeklies, Bay State Weeklies, Beacon Newspapers, the Tab newspapers were all gobbled up by CNC, which was bought by Fidelity. Overlapping newspapers led to consolidations, layoffs, fewer feet on the street, more vacanies left open until they disappeared in the next budget cycle, less local coverage, shorter tenure by most reporters and editors at most CNC papers, etc. etc. etc. Now GateHouse plays the same game, only on a larger scale. When all is said and done, Mass. will have fewer decent, locally connectged weekly newspapers, fewer local reporters covering local news, and more papers under a huge corporate umbrella, feeding the revenue demands of corporate investors and, soon, stockholders. Readers suffer and get disenfranchised. Advertisers turn away because no one is reading the papers anymore and the corporate owner wonders why he/they aren’t making money by the bucketful, as they had promised stockholders.

  2. Wes

    …has been built on a mountain of debt. Which has become the American way.

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