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.