Gannett’s latest bloodbath is under way

Massive layoffs are taking place across the country today at Gannett’s newspapers, a move that the company announced last week. I’m not going to try to keep up with the latest — we’ll know in a day or two what the total damage looks like.

Fourteen years ago, I wrote a lengthy article for CommonWealth Magazine about Gannett’s predecessor company, GateHouse Media, which even then was notorious for its slash-and-burn approach. It was ugly, but it looked like they might have a path forward. No more.

We end our summer podcasts with a round-up of local news items. See you in September!

Rainbow Arch Bridge, Lake City, Iowa, the center of a bizarre newspaper war. Photo (cc) 2014 by David Wilson.

On this week’s “What Works” podcast, Ellen Clegg and I dive into our reporter’s notebooks after our scheduled guest had a last-minute medical emergency, catching up with NJ Spotlight News, the emergence of The Lexington Observer, the transition at The Texas Tribune, and the turmoil at The Graphic-Advocate (both of them!) of Lake City, Iowa.

Ellen also has a rave for Emily Rooney’s “Beat the Press” podcast and her recent interview with legendary WCVB-TV news anchor Natalie Jacobson, who’s written a memoir about her life and career.

Like Boston’s Orange Line and Green Line, the “What Works” podcast will be off the intertubes for a few weeks as Ellen and I race to meet the deadline for our book about the future of local news. You can listen to our conversation here and subscribe through your favorite podcast app.

What the sale of Axios may mean for Boston news consumers

See correction below.

What will the sale of Axios mean for Boston news consumers? It’s too early to tell. But there are a couple of intriguing tidbits that emerged from the news that the digital startup will be acquired by Cox Enterprises for $525 million, a story first reported by Ben Mullin of The New York Times.

First, the sale appears to be good news for Axios Local. According to Rick Edmonds of Poynter Online, Cox isn’t looking to walk away from the local newsletters it’s been building out in order to concentrate on national politics. Instead, Cox wants to accelerate the growth of Axios Local. “Our goal of 100 cities is in reach,” publisher Nick Johnston told Edmonds. “I have a list of 384 metropolitan areas in my office, and we cross them off one by one.”

Second, Cox already owns is a minority owner of WFXT-TV (Channel 25) in Boston, the home of Boston 25 News. Two months ago, Axios launched a Boston newsletter produced by veteran journalists Mike Deehan and Steph Solis. Although I’m in no position to know what the strategy will be moving forward, it’s not difficult to imagine Axios Boston amplifying big stories from Boston 25, or featuring Deehan and Solis on its newscasts.

Of course, you should always follow the money. Jim VandeHei, Mike Allen and John Harris never had an opportunity to cash in after they left The Washington Post to found Politico in 2007. VandeHei and Allen were the marquee names who left Politico in 2016 to start Axios (Harris stayed behind). Monday was their big payday.

By the way, Ellen Clegg and I interviewed Deehan recently on the “What Works” podcast, so please give it a listen.

Correction/clarification. Axios has been acquired by Cox Enterprises, which spun off its television and radio stations to the hedge fund Apollo Global Management a couple of years ago. Those stations now do business as Cox Media Group. But wait: Cox Enterprises continues to hold an ownership stake in Cox Media Group, including Boston 25. Earlier this year, it was announced that Cox Media would sell Boston 25, but it’s unclear whether Cox Enterprises would keep its minority stake. So what I said above could still happen, but it’s a lot more complicated than I had realized.

While Gannett journalists brace for layoffs, those at the top rake in big bucks

Photo (cc) 2008 by Patrickneil

With Gannett targeting its journalists for yet another round of layoffs, I thought it would be a good time to take a look at the people at the top. A reminder: Gannett is an amalgamation of the old Gannett and GateHouse Media, which was notorious for cost-cutting and which dominates the new Gannett.

There’s a wealth of information — and a lot of wealth generally — in the money-losing newspaper chain’s 2022 proxy statement. It begins with Michael E. Reed, the chairman and chief executive officer, who was paid $7,741,052 in 2021. Of that total, Reed received $900,000 in base salary, $6,074,000 in stock awards and $767,052 in “Non-Equity Incentive Plan Compensation.”

Next up is Douglas E. Horne, the chief financial officer and chief accounting officer, whose payout added up to $1,753,698, of which $600,000 was base salary, $581,318 came in the form of stock awards, $562,380 was for that aforementioned incentive plan and $10,000 was in other income.

Also of interest is Gannett’s nine-member board of directors, eight of whom were paid well in excess of $200,000 to provide advice and counsel on a part-time basis. Now, I have no insight into how much work a Gannett director puts in — although, according to Investopedia, the average corporate board member takes part in just a bit under eight meetings per year. In general, though, serving on a corporate board is an exceedingly light lift. The board chair, as previously noted, is Reed. Here are the other eight directors and their compensation. You can find their company-provided bios (except Hegde, who has left the board) in the proxy report, starting at page 14.

  • Kevin M. Sheehan, $285,000 ($160,000 in fees or cash; $125,000 in stock awards)
  • Vinayak Hegde, $212,500 ($87,500 in fees or cash; $125,000 in stock awards)
  • Theodore P. Janulis, $251,250 ($120,000 in fees or cash; $125,000 in stock awards; $6,250 in other compensation)
  • John Jeffry Louis III, $235,000 ($100,000 in fees or cash; $125,000 in stock awards; $10,000 in other compensation)
  • Maria M. Miller, $225,000 ($100,000 in fees or cash; $125,000 in stock awards)
  • Debra A. Sandler, $245,000 ($120,000 in fees or cash; $125,000 in stock awards)
  • Laurence Tarica, $255,000 ($120,000 in fees or cash; $125,000 in stock awards; $10,000 in other compensation)
  • Barbara W. Wall, $235,000 ($100,000 in fees or cash; $125,000 in stock awards; $10,000 in other compensation)

For the eight board members other than Reed, that’s an average of $242,969. I can’t offer a judgment as to whether that’s excessive, but I can cite a few data points. First, in 2018, USA Today, Gannett’s flagship newspaper, republished a story from 24/7 Wall Street under the provocative headline “25 companies that pay their board of directors a shocking amount.” The lowest of those 25 was Citigroup, which paid its board members an average of $297,407 — more than Gannett, but not massively more. Second, according to Investopedia, the average corporate board member is paid $42,750, although it was much higher than that at larger firms.

You also have to ask what, exactly, Gannett’s executives and board members are being rewarded for. Last week’s bad news was only the latest for a company that seemingly can’t find a way forward. Its stock price closed at $2.36 on Friday, down from a 52-week high of $7.05 last Sept. 17. Yes, we are in the midst of a local news crisis. But Lee Enterprises, another publicly traded newspaper chain, is doing reasonably well, as are independent local news sources across the country, from larger newspapers like The Boston Globe and the Star Tribune of Minneapolis to hundreds of hyperlocal projects. Gannett needs to demonstrate that it can provide communities with the news and information they need, and they’re failing miserably at that.

Meanwhile, the people doing the actual work make peanuts. According to a study in the fall of 2020 by the NewsGuild-CWA, Gannett journalists at 14 unionized daily newspapers were earning a median salary of $52,000, and those with fewer than 10 years of experience were making $43,000 to $44,000. Those at non-union papers are almost certainly making substantially less. And now they are bracing for yet another round of layoffs, while the people presiding over this fiasco are paid hundreds of thousands or millions of dollars.

A terrible day for Gannett, to be followed by terrible days for its staff and communities

The late Gannett chairman Al Neuharth, who created USA Today, was no stranger to cost-cutting. But he’d be rolling over in his grave at what’s taking place now. Photo (cc) 2013 by George Kelly.

Gannett, the country’s largest local news chain, is in a tailspin. The publisher of some 200 daily papers reported a significant loss in the second quarter — $54 million on revenues of $749 million.

According to Rick Edmonds, who analyzes the media business for Poynter, the company is either down or missing its targets in digital and print advertising as well as print circulation. The sole bright spot: a steady rise in paid digital circulation. Extensive layoffs are on the way. Edmonds quoted a memo from Maribel Perez Wadsworth, head of the media division, in which she said: “In the coming days, we will … be making necessary but painful reductions to staffing, eliminating some open positions and roles that will impact valued colleagues.” It’s hard to see how shrinking an already diminished product is going to help.

Those of us who live in Eastern Massachusetts and environs might wonder where they are going to find any staff members to lay off. Over the past year, the chain has closed many of its community weeklies. Its dailies are still publishing, but with skeleton newsrooms.

The question with Gannett is how many of its problems are simply part of the overall local news crisis and how many are of its own making. Tim Franklin, senior associate dean and the John M. Mutz Chair in Local News at Northwestern’s Medill School, tweeted:

As it turned out, Lee did reasonably well, which Chris Krewson, executive director of Local Independent Online News (LION) Publishers noted in a response to Franklin.

I would argue that though the challenges facing community journalism are very real, there are some unique factors at work with the current iteration of Gannett, which lost its way in the cradle back when GateHouse Media was born. GateHouse and Gannett merged a few years ago, but it was essentially a takeover by GateHouse, which has been pillaging its local titles for the past 15 or so years. Gannett’s schemes to overcome the mess in which it finds itself strike me as harebrained. Its plan to pursue sports betting isn’t going well, as Edmonds reports. Then there is its dream of getting into nonfungible tokens (NFTs). Seriously?

Gannett’s flagship is USA Today, which is still a solid paper. If I had to guess, I’d say they’ll leave it pretty much alone so that they can use it as a wire service to fill up their regional and local papers. I mean, even more than they’re already doing.

Sadly, Gannett’s journalists have been on a roll, with reporters at the Indianapolis Star and The Columbus Dispatch breaking the story about a pregnant 10-year-old rape victim — and then confirming it when it was questioned by right-wing propagandists and by Washington Post fact-checker Glenn Kessler. The Austin American-Statesman obtained and published video of the police (non)response to the school shootings in Uvalde, Texas, after editing out the children’s screams. This is outstanding journalism, and soon Gannett will have fewer journalists.

Gannett’s greed and incompetence are going to mean fewer jobs for reporters and less coverage for local communities. It’s an ongoing tragedy, but it does open up possibilities for entrepreneurs who are looking to start new projects.

Elizabeth Hansen Shapiro on her national campaign to invest in local news

Elizabeth Hansen Shapiro

On the latest “What Works” podcast, Ellen Clegg and I talk with Elizabeth Hansen Shapiro, CEO and co-founder of the National Trust for Local News. She is also a senior research fellow at the Tow Center for Digital Journalism at Columbia Journalism School in New York. At the Tow Center, Dr. Hansen Shapiro’s work focuses on the future of local journalism and the policies needed to assure that future. Her research involves audience engagement and revenue strategies, as well as the relationship between news and social platforms. She holds a Ph.D. in organizational behavior from Harvard Business School.

The National Trust for Local News is a nonprofit that is dedicated to “keeping local news in local hands.” The Trust works with local news publishers, philanthropists and socially conscious investors, and, as I’ve reported, worked with other collaborators to buy 24 weekly and monthly newspapers in the suburbs of Denver, Colorado, perhaps saving them from hedge fund ownership.

I’ve got a Quick Take on a recent newsletter by past “What Works” guest Kristen Hare of Poynter, who reported on local media people who are starting to fight back against the abuse they’re receiving from some of the more sociopathic members of their audience.

Ellen weighs in on the death of Tim Giago, the founder of the first independently owned Native American newspaper in the United States, and dives back into the Dumpster fire in the newsroom of The Aspen Times in Colorado.

You can listen to our conversation here and subscribe through your favorite podcast app.

A free weekly paper will cover Middleborough and Lakeville

Oliver Mill Park, Middleborough. Photo (cc) 2022 by Dan Kennedy.

Local news outlets are popping up left and right following the decimation of our Eastern Massachusetts weekly newspapers at the hands of Gannett. But I want to give a special shoutout to Anne Eisenmenger, who’s going to launch a new weekly paper in mid-August to cover Middleborough, the town where I grew up, and neighboring Lakeville.

Nemasket Week, which will debut on Aug. 18, will be a free, advertiser-supported newspaper with a website. It’s part of Beaver Dam Partners, which currently publishes Wareham Week, Dartmouth Week and Sippican Week, serving Marion, Mattapoisett and Rochester. Eisenmenger, a Boston Globe and GateHouse Media alum who began Beaver Dam 12 years ago, has a proven track record, and I’m looking forward to seeing what she can offer in Middleborough.

Gannett shuttered The Middleboro Gazette last November as part of a wave of weekly closures — about a half-dozen in 2021, followed by 19 in 2022, along with nine others that were merged into four titles. Even worse, nearly all of Gannett’s weekly reporters were reassigned to regional beats, which means that the chain’s papers and websites have little or no local news.

So best of luck to Nemasket Week. And though it’s well outside Eisenmenger’s region, may I suggest that she take a close look at Medford while she’s at it?

The full announcement follows. And by the way, Anne, it’s Middleborough, not Middleboro. Both spellings are in use, but the town is literally the middle borough between Plymouth and Bridgewater.

Tim Coco of WHAV tells us how hyperlocal radio can serve a community

Tim Coco

In this week’s “What Works” podcast, Ellen Clegg and I talk with Tim Coco, president and general manager of Public Media of New England. Coco is known for his work as a journalist and advertising executive. He oversees day-to-day operations at the low-power FM station WHAV, which can be found at 97.9 on the radio dial if you happen to be in the Haverhill area. The station also streams at WHAV.net.

WHAV was launched in 1947 by the Haverhill Gazette newspaper, then a daily under the auspices of a publisher who was distantly related to the Taylor family, which then owned The Boston Globe. Coco revived the station about 15 years ago and converted it to a nonprofit, low-power FM station in 2014.

Ellen has a Quick Take on $2 million in grants awarded to seven nonpartisan news outlets in Georgia. All are led by people of color, and all serve diverse audiences. The money, which comes from The Pivot Fund, could be transformational.

My Quick Take is on the Herald-Tribune. No, not that Herald-Tribune. This is the Herald-Tribune of Sarasota, Florida, which had to apologize after publishing a guest op-ed in praise of the Proud Boys, the far-right group that was part of the Jan. 6 insurrection at the Capitol. It’s a doozy.

You can listen to our conversation here and subscribe through your favorite podcast app.

On the road again

Photo (cc) 2022 by Dan Kennedy

I spent a great day at NJ PBS in Newark, New Jersey, reporting on the broadcast side of NJ Spotlight News for the book-in-progress that Ellen Clegg and I are writing, to be called “What Works: The Future of Local News.” I was in the control room when U.S. Rep. Bonnie Watson Coleman, D-N.J., left, was interviewed by anchor Briana Vannozzi about her arrest at an abortion-rights demonstration in Washington the day before. You can watch the full interview right here.

Steve Waldman talks about Report for America and his quest to save local news

Steve Waldman

On this week’s “What Works” podcast, Ellen Clegg and I talk with Steve Waldman, the president and co-founder of Report for America, a national service program that places journalists into local newsrooms to report on undercovered communities. Steve came up with the concept in 2014 and joined forces with The Ground Truth Project to launch RFA in 2017.

In the projects we’re reporting on for this podcast and for our book, “What Works: The Future of Local News,” we’ve run across a number of RFA corps members. They usually have a couple of years of experience but are relatively new to the business, although there are a few near retirement age, too.

Steve has a deep background in magazine journalism. He was national editor of U.S. News & World Report and a national correspondent for Newsweek. He went on to co-found a multifaith religion website, Beliefnet.com, which won a National Magazine Award. He is also founder and coordinator of the Rebuild Local News Coalition, and he’s crafted some interesting proposals for how government can help revitalize local journalism while preserving editorial independence.

I’ve got a Quick Take on the happy conclusion to a bizarre situation involving a reporter for the St. Louis Post-Dispatch. Last fall, Josh Renaud reported that a flaw in a database maintained by the state of Missouri allowed for public access to thousands of Social Security numbers. Incredibly, the state’s governor, Mike Parson, denounced Renaud as a “hacker” and a criminal investigation was begun. It was absolutely outrageous, and now Renaud has been recognized with a national freedom-of-the-press award.

And Ellen takes it all back about Ogden Newspapers, which purchased The Aspen Times late last year but has supressed coverage and prompted a number of staff resignations.

You can listen to our conversation here and subscribe through your favorite podcast app.