I’m very sorry to hear that the seven-year-old Framingham Source is moving to a self-publishing model and will drop local reporting. Founder Susan Petroni cites burnout and financial woes. It’s tough out there.
Category: Local News
At Gannett, those better days that are just around the corner never seem to arrive
Boston Globe columnist Brian McGrory wrote Wednesday that he’d heard from Gannett chair and chief executive Mike Reed after his recent piece detailing the devastating cuts that the country’s largest newspaper chain had endured. Reed told McGrory that the worst was over and that happy days were almost here again. McGrory wrote:
“My full intention is to do more journalism, not less,” Reed said. “We’re so close to that inflection point that the major cuts are behind us.” Moments later, for emphasis: “The cuts are behind us.”
Is that a commitment, Mike?
He hesitated. I swear I could hear the loud warning beeps from a truck backing up. “What I’m saying is we’re near the end of the process on the reduction side,” he replied. Then this: “I wouldn’t say that I don’t know there’ll be one more cut.” And finally: “We’re in the ninth inning of the game.”
It sounded so familiar. I’ve written about Gannett and its predecessor company, GateHouse Media, many, many times over the years. For instance, after I wrote for GBH News in June 2019 that GateHouse seemed to be imploding, Reed contacted me to push back. He wouldn’t put any of our phone conversation on the record, but he didn’t need to. Because it’s been the same old song for a very long time.
How long? Let’s go back to August 2008, when GateHouse’s stock price was taking such a pounding that it could not longer be traded on the floor of the New York Stock Exchange. In a conference call with investors, according to the Rochester Business Journal, Reed was full of assurances that the worst was over. “Our results, while below our estimates, are holding up quite well, and our capital assets put us in a position of strength going forward,” he said. And: “We believe our assets will continue to produce strong cash flows and when the economic cycle improves we are positioned in our small markets to grow.”
If that’s not enough déjà vu for you, consider that, around the same time, the website 24/7 Wall St. named Reed “The Most Overpaid CEO Of The Day,” noting that he was being paid a salary of $500,000 to preside over a company whose stock price was down 90%. As readers of Media Nation know, Reed was just getting started. He received $7.7 million in total compensation in 2021, and was rewarded with another $3.4 million in 2022. Meanwhile, Gannett newspapers are being shut down and journalists laid off by the score.
In October 2008, I wrote a piece for CommonWealth magazine about GateHouse’s operations in Eastern Massachusetts — around 100 community newspapers, mostly weeklies, that it had acquired from Boston Herald owner Pat Purcell, who had in turn purchased them from Fidelity Capital a few years earlier. The theme of the day, inevitably, was newsroom cuts. But Kirk Davis, then the president and publisher of GateHouse Media New England, was, to invoke an old cliché, cautiously optimistic:
“We feel that community newspapers have a very viable future and, juxtaposed against the trend overall, are performing very well,” says Davis, arguing that small, community newspapers have a competitive advantage over major metros because their locally focused content is not available elsewhere. “I believe in it, and I believe it’s going to stay strong.”
Five years later, the company sought Chapter 11 bankruptcy protection so that it could restructure $1.2 billion of the debt it had taken on in assembling its newspaper chain.
The cutting continued after GateHouse emerged from bankruptcy, sometimes slowly, sometimes quickly, but always with the same downward momentum. In late 2019, GateHouse merged with Gannett, a longtime publisher that was also notorious for running its papers on the cheap. The new Gannett was saddled with $1.1 billion in debt, and a lot of that has been financed by cutting the workforce in half, as Axios reported recently. Davis left shortly after the merger, but Reed continues to decimate newsrooms, just as he continues to insist that better days are just around the corner, as he told the trade publication Editor & Publisher last November.
The problem with Gannett, as always, is that better days for Reed never translate to better days for his newspapers, his journalists or the communities they serve. McGrory’s skepticism is warranted.
Five years after the Denver Rebellion, local news is surviving in Colorado
Of all the alarms that have been sounded over the decline of local news, perhaps none was louder than the one in Denver, Colorado, five years ago this month. In what became known as the Denver Rebellion, editorial page editor Chuck Plunkett wrote a front-page editorial calling for the Post’s hedge-fund owner, Alden Global Capital, to sell the paper to local interests. Plunkett wrote:
We call for action. Consider this editorial and this Sunday’s Perspective offerings a plea to Alden — owner of Digital First Media, one of the largest newspaper chains in the country — to rethink its business strategy across all its newspaper holdings. Consider this also a signal to our community and civic leaders that they ought to demand better. Denver deserves a newspaper owner who supports its newsroom. If Alden isn’t willing to do good journalism here, it should sell The Post to owners who will.
Unfortunately, Alden did not sell; after all, there were still profits to be squeezed out. At one time, the Post employed a newsroom of about 300 people, and its competitor, the Rocky Mountain News, had another 300. But the Rocky was shut down by a different chain owner years ago, and by the time that Plunkett wrote his manifesto, Alden was in the process of downsizing the Post again, from about 100 journalists to 60.
But journalism in Denver survived. Earlier this month, Plunkett wrote an opinion piece for The Colorado Sun looking back on the past five years. The Sun grew out of the Post: 10 senior people left after the rebellion and launched a digital-only news project that has grown to a couple of dozen people. This time around, Plunkett, now at the University of Colorado in Boulder, took a more optimistic view:
So much new talent has bubbled up around us as a result it’s difficult to keep track. The legislature’s got more reporters than you shake a stick at. Who could deny the excellence and the ambition of presenting and covering Denver’s recent mayoral debates?…
Hey, it’s heartening to see media companies banging around like they want to fight. Think of how bad off we’d be if we didn’t have such energy.
What’s happened in Colorado led Ellen Clegg and me to include it in our book, “What Works in Community News,” which will be published by Beacon Press early next year. I visited the Denver area in September 2021 and learned that the metro region is being well served. The Sun, the Post, Colorado Public Radio and another startup, The Denver Gazette, were all doing good work.
The problem, though, was in those places that weren’t within commuting distance of Denver. The news deserts that exist in the rural parts of the state were why The Colorado Sun was trying to provide some statewide coverage rather than merely focusing on Denver. So it was heartening to see that several papers whose owners wanted to move on have been acquired by a small chain. The indefatigable Corey Hutchins of Colorado College reports that O’Rourke Media Group, based in Arizona, is the new owner of Colorado papers in Salida, Buena Vista, Leadville, Park County and Fairplay.
“I feel like I’m taking over newsrooms that are well resourced,” the chain’s CEO, Jim O’Rourke, told Hutchins. “I like that, because that gives us an opportunity to come in and work with this team on things that we can do differently moving forward — things that we could do to help. And it’s better starting from a position like this versus going into a totally distressed situation where the previous company gutted the place.”
The news desert problem is real. But what’s happened in Denver and, now, in rural Colorado demonstrates what I’ve seen since I started reporting on the local news crisis some 15 years ago: Where there is failure there is also opportunity.
More: Ellen and I recently interviewed former Denver Post editor Greg Moore on our podcast, “What Works: The Future of Local News.” And in June 2021, I wrote about how 24 weekly and monthly papers in the Denver suburbs were saved through an effort that included The Colorado Sun.
Shed a tear for Gannett’s Reed, whose compensation has been cut to just $3.4 million
I guess we’ll have to start referring to Mike Reed as Gannett’s $3.4 million man.
According to Gannett’s just-released proxy statement for 2022, Reed, the newspaper chain’s chair and CEO, received nearly $3.4 million in total compensation last year, down from $7.7 million the year before. That’s a decline of 56%, but it’s still a healthy pay package for someone who has wreaked so much destruction on the local news business. It’s also 66 times more than the median salary ($51,035) earned by Gannett employees in 2022, as Don Seiffert observes at the Boston Business Journal. Seiffert broke the news about Gannett’s latest numbers on Friday afternoon.
The main difference in Reed’s compensation package is that he received just $2 million in stock awards in 2022, down from about $6 million in 2021. His base salary was cut slightly as well, from $900,000 to $859,615, but he also received a bonus of $513,652 in 2022, which he did not get in 2021. Finally, he got a 401(k) match of $6,184 in 2022, something he didn’t get in 2021. I guess we can refer to that last as rubbing-it-in money, since Gannett suspended 401(k) matches for its employees last October. If they were restored later on, I haven’t heard about it.
Gannett’s chief financial officer and chief accounting officer, Douglas Horne, received nearly $2.2 million in 2022, up from about $1.75 million the year before. And all but one of Gannett’s nine non-executive board members continued to receive in excess of $200,000 for their part-time work — which, as I reported last August, was at least generous, and perhaps excessive, when compared to other publicly traded companies. You’d think that would especially be the case for Gannett, whose stock price opened 2022 at $5.54 a share and closed the year at $2.03. (It’s now down to $1.87.)
Gannett is our largest newspaper chain, but it’s hard to say exactly how large. At one time it published more than 200 dailies and a slew of weeklies, but it’s been closing weeklies in droves over the past few years. Just last week, Sara Fischer of Axios reported that Reed was predicting the closure of more papers moving forward. Just recently a knowledgeable industry observer told me that they wouldn’t be surprised if Gannett got down to about 30 dailies, including its flagship, USA Today, and zero weeklies in the not-too-distant future.
Gannett’s annual meeting is scheduled for June 3. If the past is any indication, though, the only complaint will be that Reed hasn’t cut enough.
Maine publisher Reade Brower says he’s ready to move on. So what comes next?
Maine newspaper publisher Reade Brower is getting ready to move on. Michael Shepherd and Lori Valigra of the Bangor Daily News, the only daily in Maine that Brower doesn’t own, reported on Thursday that the publisher is seeking to wind down his stewardship of the Portland Press Herald, four other daily papers and a number of weeklies.
In a follow-up by the Press Herald’s Eric Russell, Brower sounded like he isn’t in any hurry, and that he was not yet sure what the transition might look like. Brower put it this way in a memo to the staff:
The truth is I am beginning the search for what’s next, whether that be a new steward or perhaps partners willing to join me in carrying the torch. We are watching new ownership models emerge across the country from B-corporations to nonprofit efforts. Transparency has always been a pillar of journalism, and it’s important to me personally. That said, people will speculate because it is human nature. Over the past couple of years, I have been approached and looked at different pathways for the future but did not pull the trigger — either I wasn’t ready, I still felt my job was not completed, or the path just didn’t feel right.
A B-corporation is another name for a public benefit corporation — for-profit that is under no obligation to maximize earnings, allowing revenues to be reinvested in the mission. In the news world, some well-known B-corps include The Colorado Sun, Lookout Santa Cruz and, closer to home, The Provincetown Independent.
Brower, by all accounts, has been a decent steward of his Maine properties. More important, he’s kept the national chains out of the state, and he may well have outlasted them. Gannett is getting rid of papers, as Sarah Fischer of Axios observes, so it would be unlikely that the company would bring its special brand of looting and pillaging newsrooms to Portland The hedge fund Alden Global Capital hasn’t acquired anything for quite a while, so perhaps we can hope that its executives are content with their current holdings. As I told Russell, “Whether this has a happy ending or not depends on who steps forward as buyer.” If Brower’s memo is any indication, he cares about his legacy.
Brower came in after a tumultuous period at the Press Herald, which I recounted in my book “The Return of the Moguls.” In 2008, the paper’s then-owner, The Seattle Times, sold it to a businessman named Richard Connor, who promptly ran it into a ditch. Four years later, the paper was nearly sold to Aaron Kushner, a wealthy Boston-area tech entrepreneur who had previously been spurned in his bid to purchase The Boston Globe.
Union leaders at the Press Herald rebelled at Kushner’s demand for concessions. Kushner moved on, buying the Orange County Register in Southern California and steering it into bankruptcy after a massive, ill-advised expansion failed to produce the revenues he was hoping for. The Press Herald’s fortunes, meanwhile, began to improve. First, billionaire Donald Sussman stepped forward and ran the paper for a few years. Then, in 2015, Sussman was succeeded by Brower, a printer who lacked Sussman’s deep pockets but who cared about news coverage and kept cuts to a minimum.
The Press Herald and its affiliated newspapers have a reputation for doing things the right way, and Brower surely deserves credit for that. I hope this week’s news means the continuation of what he has accomplished — and not the beginning of the end.
Public radio and the local news crisis
Current, a publication that serves people in the public media system, has published Thomas Patterson’s important essay on how public radio can ease the local news crisis, as well as my response.
The pieces are behind a pretty high paywall, but you can read Patterson’s essay for free here and my response here.
Mark Histed of the Democracy Policy Network talks about local news vouchers
On the latest “What Works” podcast, Ellen Clegg and I talk with Mark Histed, a researcher at the Democracy Policy Network. DPN is a network of policy organizers who have a simple mission: sustaining democracy. That work takes place largely at the local level. Mark and others at DPN do research and provide deep-dive policy kits that help local citizens and legislators champion big ideas.
Mark leads the Local News Dollars effort and recently wrote a report on how states can establish a system where residents are issued vouchers they can use to subscribe or donate to the local journalism outlet of their choice.
In our Quick Takes, I discuss Ralph Nader — remember him? The consumer advocate-turned-presidential political spoiler got a lot of favorable attention late last month when it was learned that he would help launch a nonprofit newspaper in his hometown of Winsted, Connecticut. The paper, the Winsted Citizen, was the town’s first in a couple of years, although the daily Republican-American covers the area, too. But now people are wondering what exactly is going on — and if Nader is really going to come through with enough money for the Citizen to achieve liftoff.
Ellen tunes in to the new “Boston Strangler” movie on Hulu. In the movie, Keira Knightley portrays the late, great Loretta McLaughlin, who paired up with reporter Jean Cole at the Boston Record American to write a series of stories about the murders of women in Boston in the 1960s. Loretta moved on to The Boston Globe, where she did groundbreaking work on the AIDS crisis and became editorial page editor. She was a mentor to many, and an especially fierce advocate for the advancement of women in journalism.
You can listen to our latest podcast here and subscribe through your favorite podcast app.
Talking local news with Gerard Cunningham of ‘Freelance Forum’
Great talking with Gerard Cunningham on his podcast, “Freelance Forum,” about the future of local journalism and my book-in-progress with Ellen Clegg, “What Works in Community News.” Please give it a listen.
GBH News covers the revival of community journalism
Nice doubleheader on the revival of local news in Greater Boston from my friends at GBH News. Jeremy Siegel reports on three startups in the suburbs — the Burlington Buzz, the Framingham Source and the Marblehead Beacon — as well as Boston Black News, a radio outlet. (Jeremy interviewed me as well.)
Tori Bedford has a piece on the ownership transition at The Bay State Banner, which has been covering the Black community since 1965 and whose new executives have some ambitious expansion plans.
Ralph Nader helped launch a newspaper. Now he’s accused of failing to pay for it.
Consumer advocate Ralph Nader was hailed as a hero in late February when it was reported that he would launch a nonprofit newspaper in Winsted, Connecticut, where he was born. The new paper, the Winsted Citizen, hired veteran journalist Andy Thibault as its publisher and editor, and it looked like nothing but bright skies on the horizon. The paper is the town’s first since the Winsted Journal shut down in 2017, although the community is covered by the daily Republican-American of nearby Waterbury.
But the Citizen stumbled right of the gate — and the reason is that Nader apparently didn’t come through with the money he had promised. According to Bob Sillick of the trade publication Editor & Publisher and Daniel Figueroa IV of Hearst CT, Nader failed to provide the $22,500 that Thibault said he had pledged to fund the Citizen’s second edition, instead offering an $8,000 loan. That offer was turned down. The Citizen is having trouble meeting payroll, and it sounds like the future of the Citizen is in doubt, although Thibault says he and his staff are pushing ahead.
If there’s another side to the story, we’re not hearing it from Nader. Both Sillick and Figueroa say that Nader has not responded to their attempts to obtain comment. Meanwhile, the print-centric newspaper, which costs about $30,000 per issue to produce, is going to pivot to digital-first, although print will continue to be offered. The website will be paywalled. Thibault has posted the statement he gave to Hearst on the Citizen’s blog, and I reproduce it here in full:
It is true that we put out the second edition without promised funding and that we owe many contributors pay for services rendered. With ongoing support from subscribers, advertisers and donors, we absolutely will honor all our obligations.
I am so proud to work with all our staff individually and collectively. These are real people running on broken glass through the desert sand to get the job done. They are young and old, some approaching the end or their careers and some just starting It is my duty as editor and publisher to serve our readers and staff. As long as I breathe, I will, without fear or favor.
Our leadership team and staff continue to work eight days a week. On Monday we will conduct a thorough review of all financial data. Story conferences have cranked up already for the April edition. Deadlines [have been set].
Initially, Ralph told me he only wanted to do a pilot edition, then sit back for six or eight weeks to get feedback. I told him that would not work, we need a Second Act and funding for six months at double the rate for the first edition. Managing Editor Melanie Ollett and Advertising / Circulation Director presented detailed budgets by request and they were ignored.
These are indisputable facts and I would submit to a state police certified polygraph exam.
During a conversation with Ralph and his legal counsel I agreed to produce 25% of the revenue needed for the second edition and was promised funding on that basis.
This has not happened. Instead Ralph switched gears and, through his counsel offered a loan of $8,000 that has not shown up … We are deeply grateful for the support of the community.
Andy Thibault