If you live in a suburb or exurb of Boston, or on Cape Cod, there’s a pretty good chance that you read a community newspaper published by GateHouse Media New England — maybe even two.
GateHouse, a national chain based in suburban Rochester, N.Y., owns more than 100 newspapers in Eastern Massachusetts, including such well-known dailies as the Patriot Ledger of Quincy, the Enterprise of Brockton and the MetroWest Daily News of Framingham.
I’ve got a story on GateHouse in the new edition of CommonWealth Magazine in which I find that though the financial condition of the company is dire, its top executives make a decent case that they’ve got the time and the resources to grow their way out of the current mess. And its online initiatives are interesting and worth keeping an eye on.
The question: Can the company’s chief executive in New England, Kirk Davis, eventually begin rebuilding his staff after two decades’ worth of cuts under three and in some cases four different owners, including Fidelity and Boston Herald publisher Pat Purcell? Or is GateHouse, and the rest of the newspaper industry, doomed to keep shrinking?
One problem is that the economic outlook is considerably worse than it was in early September, when I was wrapping up my reporting and writing the story. Last Friday, the Boston Herald ran a report that seven editorial employees had lost their jobs at MetroWest and the Milford Daily News. Well-informed buzz within the company suggests that’s just the tip of the iceberg.
In addition, the New York Stock Exchange this week, in a long-anticipated step, announced that it will delist GateHouse’s stock, which is essentially worthless. And a major investor is getting out.
Still, the principal on GateHouse’s enormous debt is not due until 2014, and its cash flow has been decent. Whether that will continue as we move into what may be a deep recession remains to be seen.
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O-FISH-L
Dan, how is Gate House supposed to “grow it’s way out” when the rest of the industry is collapsing? I’m not being sarcastic, just wondering what solutions you expect them to come up with when nobody else has? The fact that massive debt isn’t due until 2013 sounds more like a terminal cancer diagnosis with a 4-5 year life expectancy than anything else. Sure, they might cure cancer in the next five years, but c’mon. As a resident of Patriot “Ledgerland” I don’t see that paper surviving very long at all. Case in point, for years the Quincy based paper had a full-time City Hall reporter. In fact there are plaques in the hall as tributes to the retired ones. One of these, Ray McEachern, exclusively covered the license board. As boring as it sounds, Ray made liquor licenses, yard sales and bingo permits the talk of the town, to the point where local cable access began live, wildly popular coverage of the meetings. The city even had to change the meetings from morning to night so that working people could get home and watch! As popular as ever, cable still covers the meetings but sadly Ray McEachern retired and now the Ledger doesn’t even show up. The local weekly independent Quincy Sun smartly gives an elderly lady a full page to report on them. If the agenda is light and she can’t complete the page, she inserts an Italian recipe instead. Last week, the recently retired Quincy Police Chief, a lightning rod for controversy, appeared before the License Board (he sat on it until July) to keep a feud going with a merchant whose license he had previously denied. It was definitely one of the top License Board meetings in recent years, with the ex-Chief going to the podium then sitting down on at least three separate occasions, at one point challenging his former colleagues on the board as to their authority to even hear the case. Again, it led coffee shop and dinner table discussion, but not a morsel of Ledger coverage, in their hometown. I mentioned it to a reporter I know and she said she had heard about it but nobody was covering it. Examples of lapsed Ledger coverage abound, this is just one of them.So much for Wicked Local. Is it any surprise that the stock was just de-listed from NYSE?
gem0672
(Howard) Owens’s response: “There are some incredibly talented hardworking people in New England who are asked to do an incredible amount of work. There are also slackers, and at some point you have to hold them accountable.”With this statement, is Owens justifying the maddening workload at GateHouse as well as any layoffs? If he is, this is an incredibly arrogant, out-of-touch statement and an insult to the people who have been let go. Many people like myself who have left GateHouse can tell you number of “slackers” in the company is minuscule compared to the number of people who are slaving away. Focusing on new media is a great idea, but the core of your product is news-gathering, and reporters and editors are spread too thin in many cases there to effectively do their jobs. In turn, readers see the drop in quality and cancel subscriptions… and look at the web sites less often. Let’s make one thing clear: GateHouse’s current predicament is due to management’s failure to adequately staff their newsrooms and the greed of people somewhere in NY who thought it would be a good idea to keep eating up papers until their stomach exploded.
LFNeilson
It’s a shame that so many papers have been gobbled up by this “Chinese water clock” that has spread itself too far and wide to present much local news. The fact remains that it takes shoe leather to snoop out good stories. All the cards are up in the air right now, and we’re holding our breath. If Gatehouse goes under, what will become of the newspapers? Is there any entity willing to step in to run them as one operation, on a model that already has three strikes? Will smaller owners, possibly in the communities, purchase some papers and try to run them as smaller groups, such as existed a quarter-century ago? (North Shore Weeklies, Minuteman Publ., etc.) Will the slate be wiped clean, leaving the field open for some brave souls to attempt to start new papers? Or will the web overpower all such efforts? We have box seats on a historic moment in journalism. Peanuts, anyone?
hullbound
Actually I am one of the freelance photogs from the South Unit from the South Shore and I believe that if for some reason Gatehouse falls to the graveyard of weekly papers,another gallant soul will step in and buy the wagon of weekly papers..Just an opinion only.I am hoping for the best!Craig,Photog
J.S.Cutler
A newspaper isn’t a bank and bigger isn’t always better. (Come to think of it, bigger isn’t always better for banks either.)I’ve seen the CNC chain grow and grow and each time it got worse. Probably because the new owners always had to cut costs to pay for the acquisition cost. You can only cut so much.My hope is that Gatehouse is broken up into smaller chunks and some semblance of local ownership returns. Without a large debt service I’m betting they could actually put out a pretty good editorial product, even in this tough economic climate.
Peter Porcupine
DK – I subscribed – cash money – to The Register for over 20 years. It was a great local paper. Then as it was sold around like a subprime mortgage, it dropped Selectman coverage, board coverage, school coverage, and on and on. It got less and less about my town until the ‘Wicked’ Local incarnation which was gibberish with no useable archives. I finally let my subscription lapse about four years ago.Craig, I hope you’re right, and I hope somebody DOES buy and restore these papers, cuting them free from the pseudo chain they’ve been melded into. But my experience with the papers abused by absentee owners on Cape makes me pessimistic.