Tag: Alden Global Capital

The FT offers a close-up look at how Alden is destroying the Hartford Courant

The state capitol in Hartford, Connecticut. Photo (cc) 2009 by Dan Kennedy.

Not too many years ago, New England was home to a number of medium-size and smaller daily newspapers that did an excellent job of covering their communities. There are a dozen or so that come to mind. But among the largest and the best were The Providence Journal and the Hartford Courant.

The Journal, as we all know, has been decimated by its corporate-chain owner, Gannett, the successor to GateHouse Media. The Hartford Courant, which bills itself as the oldest continuously published paper in the country, has been battered for years under the ownership of a chain now known as Tribune Publishing. The Courant’s printing has been outsourced, and the newsroom was shuttered recently as well. There is no indication that reporters and editors will have a place to work other than their homes even after the COVID pandemic is behind us.

As I’ve written several times recently, the hedge fund Alden Global Capital, whose MediaNews Group is widely regarded as the worst newspaper owner in operation, controls 32% of Tribune — and is seeking a majority share.

The Financial Times recently published a lengthy article on the plight of local news focused on the Courant. There is nothing new in the story — we hear about the widespread closure of community newspapers, the rise of hedge-fund ownership and other familiar themes. Nevertheless, it’s a strong overview for anyone who’s unfamiliar with the tale of what happened to a key part of democratic life.

There are also a few points that deserve to be emphasized. At a time when profits in local news are elusive at best, Alden is living high:

The cost cutting is certainly working. MediaNews Group achieved about 20-25 per cent operating margins in 2019, according to people familiar with the matter, more than double that of peers such as Gannett or even The New York Times. In 2020, although the pandemic shattered advertising and MNG’s revenues fell by 20 per cent, the company was still on track to make a profit.

The Courant itself is doing well from a bottom-line perspective as well, earning a profit of $2 million a year, according to the FT’s reporting.

What this shows is that there is still an inflow of cash into even the most moribund newspapers. Readers buy them despite their ever-decreasing value. Businesses advertise in them. If you’re willing to gut the newspapers you own to keep expenses well below income, and to keep cutting as income continues to fall, well, yes, you can earn a profit. At some point, needless to say, you’ll reach the point at which you can no longer cut. And that’s when you shut your doors. (Oops. Bad analogy. They already have.)

Heath Freeman and other officials at Alden rarely speak for the record. When Freeman cooperated with a Washington Post reporter last year, it, uh, did not go well. So I was interested to see that the FT did manage to get a comment out of a company spokesperson named Chrissy Carvalho. It was a classic:

It’s a lot easier to make snippy anonymous comments than actually undertake the difficult task of making sure news organisations across America are able to serve their communities during a prolonged period of declining revenues.

As the FT notes, there are efforts to try to get Tribune to sell the Courant to local interests. But that’s going to be hard to do given the paper’s continued profitability. The tragedy is that the crisis afflicting local news is only partly related to external factors such as technology, the decline of advertising and the rise of Google and Facebook. Corporate greed is at least as responsible.

Previous coverage:

Saving local news: Some ideas from philanthropy, business and technology

Photo (cc) 2016 by Dan Kennedy

Could the example of the late Gerry Lenfest save Tribune Publishing’s newspapers from the avaricious clutches of the hedge fund Alden Global Capital?

About a half-dozen years ago, Lenfest, a billionaire investor, unexpectedly became the owner of The Philadelphia Inquirer and its related media properties. It’s an incredibly convoluted story that I tell in “The Return of the Moguls,” but essentially he had acquired a piece of the Inquirer with the intention of flipping it, and he ended up instead with the whole thing.

Lenfest’s next move saved quality journalism in Philadelphia: In early 2016 he donated his media properties to the Philadelphia Foundation, which in turn set up a nonprofit that, after his death, became known as the Lenfest Institute for Journalism. Today the Inquirer is in far better shape than many metro dailies.

Writing for the Columbia Journalism Review, Jim Friedlich, executive director and chief executive of the institute, argues that Tribune newspapers could be saved if deep-pockets philanthropists acquired them and then emulated Lenfest — or simply ran them as for-profit enterprises, as with John and Linda Henry at The Boston Globe and Patrick Soon-Shiong at the Los Angeles Times and The San Diego Union-Tribune. Friedlich writes:

An Alden purchase of all of Tribune doesn’t have to be a fait accompli. In fact, the threat of such a deal represents an opportunity for civic-minded local investors across the country, who could use this case not only to save a critical local news institution, but to reinvent it.

Soon-Shiong continues to be a major Tribune shareholder, and I recently wrote that he should consider rescuing the chain, which includes papers such as the Chicago Tribune, The Baltimore Sun and the Hartford Courant, the oldest continuously published daily newspaper in America.

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As we know, local news is in crisis, and that has produced a considerable amount of ferment. Most of the attention right now is on Alden’s bid for a majority share of Tribune, which involves regional rather than strictly local news organizations. But there’s a lot happening at the grassroots as well.

For instance, Sarah Scire reports for the Nieman Journalism Lab on an ambitious effort to provide local news start-ups with the support they need to launch and continue operating. Imagine a journalist who’s been laid off by a corporate-owned newspaper and who wants to start something at the hyperlocal level. Where to begin?

According to Scire, the Tiny News Collective takes care of a lot of the back-end details that journalists are usually not trained to attend to themselves. “The project,” Scire writes, “will offer entrepreneurial journalists a tech stack, business training, legal assistance, and back-office services like payroll for around $100 a month.”

The Tiny News Collective, a collaboration between News Catalyst and LION (Local Independent Online News) Publishers, is hoping to have a hand in starting news projects in 500 communities, half of them covering underserved populations.

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Also worth watching is the Crosstown Neighborhood Newsletter project in Los Angeles — an effort to make smart use of data in order to produce a multitude of newsletters, each aimed at a tiny slice of the public. The editor, Gabriel Kahn, a professor at USC Annenberg, writes that Crosstown — “a collaboration between software engineers, designers and journalists” — recently launched 110 such newsletters in one day. He explains:

Our formula starts with data. We collect data about everything we can in Los Angeles, from traffic and crime to COVID-19 cases and building permits. Much of this data is hiding in plain sight, housed on local government dashboards that are hard to navigate. We divvy up the data by neighborhood. One citywide dataset about parking fines becomes 110 stories about how many more or fewer tickets were issued in each neighborhood during the COVID lockdown.

Crosstown reminds me of EveryBlock, a project started in 2008 by the pioneering data journalist Adrian Holovaty that was also heavily dependent on publicly available data. EveryBlock never really caught on, and it shut down in 2013. But far more information is online today than was the case a decade ago, and the tools for presenting it have improved considerably. It could be that the time for Holovaty’s idea has arrived.

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Can the union representing Tribune’s workers stop Alden Global Capital?

The union at most of Tribune Publishing’s newspapers are making a bold move to stop Alden Global Capital from destroying local journalism in their communities.

Lukas I. Alpert reports in The Wall Street Journal that the News Guild, which represents workers at seven of Tribune’s nine daily newspapers, is demanding that three of the members of Tribune’s seven-person board of directors step down for violating Securities and Exchange Commission rules. The three members were appointed by Alden, a New York-based hedge fund.

One of the three is none other than Randall Smith, the subject of a brutal takedown in The Nation several years ago for pillaging his newspapers and using the money to buy 16 homes in Palm Beach, Florida, for $57 million. (OK, you can’t prove that there was a direct transfer of funds. But money, as they say, is fungible.)

Alden denies any wrongdoing in the would-be Tribune deal, in which it would acquire a majority share of some of our most important newspapers, including the Chicago Tribune, The Baltimore Sun and the Hartford Courant, for an offer valued at $521 million.

Earlier:

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Could Patrick Soon-Shiong save Tribune’s newspapers from Alden’s clutches?

Patrick Soon-Shiong. Photo (cc) 2014 by NHS Confederation.

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Could the billionaire surgeon Patrick Soon-Shiong save Tribune Publishing’s newspapers?

A report in today’s Wall Street Journal on Alden Global Capital’s bid to grab majority control of the company notes that Soon-Shiong is Tribune’s second-largest shareholder. Soon-Shiong bought the Los Angeles Times, The San Diego Union-Tribune and a bag of balls from Tribune in 2018 for about $500 million. Alden proposes to pay $521 million to up its share of Tribune from 32% to more than 50%.

Despite a somewhat rocky tenure, Soon-Shiong has invested in the L.A. Times similar to the way John and Linda Henry have with The Boston Globe and Jeff Bezos with The Washington Post. Saving Tribune papers such as The Baltimore Sun, the Daily News of New York and, closer to home, the Hartford Courant would be a tremendous act of civic leadership. And maybe an owner who’s actually interested in journalism could figure out a way to turn a small profit without stripping their newsrooms.

Soon-Shiong has plenty of money, but there are two big questions: Does he have the ambition to be a newspaper mogul on the order of William Randolph Hearst? (Even the modern-day mogul Rupert Mudoch owns just a handful of U.S. papers, including the Journal.) And can anyone restore Tribune’s papers to their former glory?

Alden Global Capital wants to take another big bite out of Tribune Publishing

The iconic Chicago Tribune Tower, sold for mixed-use development in 2016.

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It looks like 2020 is going to end on a suitably terrible note for the future of local and regional news.

The New York-based hedge fund Alden Global Capital, notorious for depriving its newspaper chain of staff, resources and even office space, is planning to make a play for majority control of Tribune Publishing Co., which owns such storied titles as the Chicago Tribune, The Baltimore Sun and New York’s Daily News. The Wall Street Journal broke the news on Wednesday.

Alden has owned 32% of Tribune for a while and, as Julie Reynolds reports for the union publication NewsMatters, has essentially been calling the shots. She writes:

The hedge fund has left its classic stamp of profiteering across the news chain’s operations — letting Tribune’s digital efforts flounder where other chains have thrived, shutting down newsrooms and offices after defaulting on rent, slashing reporter and other staff pay during the pandemic crisis, and now being sued by shareholders — all while Alden’s officers on the board are handsomely rewarded for this “performance.”

As Reynolds notes, Tribune has been closing newsrooms — including just this week at the Hartford Courant, the oldest continuously published daily paper in the country, according to Western Mass. Politics & Insight. The move comes not long after the Courant outsourced its printing to The Republican of Springfield.

Alden’s own MediaNews Group papers have been shutting newsrooms as well. In Massachusetts, the Enterprise & Sentinel of Fitchburg was rendered homeless several years ago. During the summer, Northeastern journalism student (and “Beat the Press” intern) Deanna Schwartz and I learned that the Braintree office of MNG’s Boston Herald had apparently closed, with operations moved to The Sun of Lowell, another MNG property.

Of course, it’s at least theoretically possible that new newsrooms will be found for some of these papers after the pandemic has ended. A number of papers — including The Boston Globe — have kept their offices even though nearly all of their employees are working from home. That’s an expensive proposition. Still, it would hardly be a surprise if Alden decides that what few journalists it still employs can work from home indefinitely.

That would be a mistake. News organizations, like most businesses, thrive on collaboration and ideas that bubble up from teamwork. Then again, there is no sign that Alden executives care.

Tribune’s daily newspapers are, for the most part, larger and have more vitality than MNG’s collection of dailies and weeklies. The metros that MNG publishes, such as The Denver Post, The Mercury News of San Jose and the Orange County Register, have already been trashed beyond recognition. Earlier this fall, Larry Ryckman, co-founder of the start-up Colorado Sun, said at a conference that at one time the Post and its now-defunct daily competitor, the Rocky Mountain News, employed about 600 journalists. Today, he said, the Post has about 60.

If Alden succeeds in grabbing majority control of Tribune, it will represent the latest step down in a long fall that began with its acquisition by the foul-mouthed Chicago real-estate mogul Sam Zell in 2008. The Zell years were the subject of a monumental takedown by the late New York Times media columnist David Carr in 2010, with Carr describing a culture that “came to resemble a frat house, complete with poker parties, juke boxes and pervasive sex talk.” Oh, and they were pillaging the company, too.

Later, under new owners, the company was renamed tronc Inc. — and yes, that’s a lowercase “t” that you see.

In 2018, the billionaire surgeon Patrick Soon-Shiong managed to wrest the Los Angeles Times and The San Diego Union-Tribune from tronc’s clutches. And though the Soon-Shiong era has not been without bumps in the road (including an ugly internal dispute over racial justice), his wealth has given his papers a future.

As for the papers now controlled or soon to be controlled by Alden Global Capital, the future is likely to be nasty and brutish, to take John Locke Thomas Hobbes out of context. Whether it will also be short remains to be seen.

Bright lights in Denver

After Alden Global Capital destroyed The Denver Post, everyone assumed it was lights out. A city that had long had two vibrant daily papers (the Rocky Mountain News closed down in 2009) now barely had one.

Suddenly, though, news sources are proliferating in Denver. Today the all-digital Denver Gazette makes its debut, joining an earlier start-up, The Colorado Sun. The alt-weekly Westword continues to publish.

The lesson, as always, is that when legacy media fail, entrepreneurial journalists seize the opportunity to move in.

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As Gannett seeks to hire journalists, Alden continues to ‘strangle’ them

Photo via the U.S. National Archives and Records Administration.

Previously published at WGBHNews.org.

Among those of us who follow the business of local news, there is a tendency to lump the two most notorious corporate chain owners together. Gannett Co. and Alden Globe Capital, after all, are both notorious for slashing their newsrooms to the bone. Their newspapers and websites in too many instances fail to meet the information needs of the communities they purportedly serve.

Yet there is a difference. And I was reminded of that difference recently by Rick Edmonds, who analyzes the media business for the Poynter Institute.

After a decade’s worth of cuts, Gannett is planning to bolster its reporting corps in the near future, Gannett chief executive Mike Reed told Edmonds — although he didn’t provide any numbers. Currently, Gannett employs about 5,000 journalists at its properties, which include USA Today, about 260 regional dailies and many other weekly papers and websites, including dozens in Greater Boston.

“We need to get even better,” Reed was quoted as saying. Well, OK. I would replace “even” with “a lot.” Still, such talk would be unimaginable at Alden Global Capital, whose MediaNews Group chain of about 200 papers has sparked newsroom revolts as well as demands from 21 U.S. senators that the company stop its “reckless acquisition and destruction of newspapers,” according to a recent story by Sarah Ellison in The Washington Post.

The difference between how Gannett and MediaNews are perceived may have something to do with their ownership structures.

The current Gannett is the result of a merger late last year between Gannett and GateHouse Media. Despite keeping the Gannett name, it was clearly GateHouse that got the better of the deal: Reed was the chief executive at GateHouse before assuming the same position at Gannett. The new Gannett immediately embarked on an estimated $400 million in cuts in order to pay down the debt it had taken on in financing the merger, according to the media-business analyst (and newly minted entrepreneur) Ken Doctor at Nieman Lab.

Gannett is a publicly traded corporation, which means that Reed’s ultimate goal is long-term growth and sustainability — albeit with as little journalism as the company can get away with. Reed hopes to do that by leveraging Gannett’s media holdings with digital marketing subsidiaries the company owns as well as an events business, which is obviously on hold during the COVID pandemic.

If everything works out over time, it is possible to imagine Gannett’s local news outlets staffing up and providing better, more comprehensive coverage than they have in recent years. As good as what would be offered by independent newspapers and websites? Almost certainly not. But any improvements would be welcome.

Alden Global Capital, on the other hand, is a hedge fund. And as best as anyone can tell, the company has no strategy for MediaNews Group beyond extracting as much money as it can for as long as it can. Its Massachusetts papers, the Boston Herald, The Sun of Lowell and the Enterprise & Sentinel of Fitchburg, operate on a shoestring. The Fitchburg office was closed several years ago. The Herald’s office in Braintree was recently shut down as well, although it’s unclear whether that was a temporary, COVID-related move or something permanent.

In Ellison’s Washington Post article, Alden managing director Heath Freeman tried to portray himself as a savior of journalism. “I would love our team to be remembered as the team that saved the newspaper business,” he was quoted as saying. Ellison, though, ran through a list of MediaNews papers across the country that have been so gutted that they have virtually no one to cover the news.

“Don’t buy the idea that Alden is trying to save newspapers. I don’t think any idiot would buy that,” said Dean Singleton, the owner of an earlier iteration of MediaNews Group whose own reputation as a cost-cutter looks benign by today’s standards. Freeman’s retort: “We’ve saved the very newspapers that Dean Singleton ran into bankruptcy, so take his recriminations with a grain of salt.”

Stop me if you’ve heard me say this before, but quality local news can be a key to reviving civic engagement, which in turn could help us overcome the hyperpolarization that defines our culture nationally. According to a recent survey by Gallup and the Knight Foundation, 70% of Americans believe the news media play a “critical” (30%) or “very important” (42%) role “in making residents feel connected to their local community.”

Moreover, Andrea Wenzel of Temple University, in her new book “Community-Centered Journalism: Engaging People, Exploring Solutions, and Building Trust,” found that people trust local news outlets more than they do national media.

“While national press was perceived by residents of all political backgrounds as distant, privileged, and dismissive of local culture,” she wrote, “it was not uncommon for residents to have first- or secondhand interactions with local reporters. So while participants could identify shortcomings, there was a base-level familiarity and trust.”

Those interactions are important — but they are becoming increasingly rare at the local news organizations being run by Gannett and MediaNews Group. At least there’s some reason to hope that the situation might improve at Gannett. As for MediaNews, a former reporter for the chain, Julie Reynolds, put it this way in The Nation several years ago: “Don’t just blame the Internet for journalism’s decline. Old-fashioned capitalist greed also strangles newspapers.”

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A beautifully told story that offers nostalgia about local news but not much hope

The New York Times has published an article about Evan Brandt, the last reporter covering Pottstown, Pennsylvania. His paper, The Mercury, has been decimated by its owner, the notorious hedge fund Alden Global Capital. It’s a great story, beautifully written by Dan Barry, with superb visuals by Haruka Sakaguchi.

And yet the air of inevitability bugs me. Barry offers nostalgia, not hope. I’m not going to suggest that Brandt quit and start his own local news project — he’s in his 50s, has a kid in college and his wife his sick. But why doesn’t the community get together, start a news project and make Brandt the first hire?

Better yet: Why can’t LNP, the newspaper in nearby Lancaster, which is independently owned and reportedly doing well, hire Brandt for a Pottstown edition? Lancaster is probably a bit too far away to justify firing up the printing presses and the trucks. But a digital edition wouldn’t cost much, and would allow them to expand their paid subscription base — much as The Boston Globe did in Rhode Island.

It doesn’t have to be this way.

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Alden’s Heath Freeman: Destroying the newspaper business in order to save it?

Sarah Ellison of The Washington Post profiles Heath Freeman, the undertaker-in-chief for Alden Global Capital’s MediaNews Group, the worst newspaper chain in the known universe.

Alden is notorious for destroying good newspapers like The Denver Post and The Mercury News of San Jose, and is now making a play for Tribune Publishing, which owns big metros like the Chicago Tribune and The Baltimore Sun. In Massachusetts, Alden owns the Boston Herald, The Sun of Lowell and the Sentinel & Enterprise of Fitchburg.

“I would love our team to be remembered as the team that saved the newspaper business,” Freeman tells Ellison. She follows up with this withering paragraph:

This is what Freeman’s approach to saving the newspaper business looks like in St. Paul, Minn.: A local sheriff blew his budget by $1 million and there was no Pioneer Press reporter available to cover the county board meeting. In San Jose: There was no reporter on the education beat at the Mercury News when the pandemic started closing schools. In Denver: In the aftermath of the 2012 Aurora movie theater mass shooting, the editor was asked to slash staff to improve the next month’s budget numbers. In Vallejo, Calif.: There is exactly one news reporter left at the Times-Herald to cover a community of 120,000 people.

The best thing that could happen for those communities is for MediaNews Group to collapse. The papers would still be there, and they would almost certainly have a brighter future on their own.

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How Alden Global Capital is strangling Connecticut’s Hartford Courant

Note: Susan Campbell, a Hartford Courant columnist, posted the following on Facebook earlier today, writing, “I am told the Courant is shifting focus to cover the coronavirus and the column I submitted wouldn’t be read, or run this Sunday. So here is the column I wrote.” I contacted her and asked if I could republish it at Media Nation. She gave her permission, and so here it is. Her column has also been republished by #NewsMatters, “a NewsGuild project for Digital First Media workers.” Digital First Media is an earlier name for MediaNews Group, the newspaper chain that Alden controls. — DK

By Susan Campbell

Dear Hartford Courant reader,

Your roof is on fire.

The signs have been there, but you may not be aware of the damage overhead. What you, the reader, sees are a few typos, a missed paper, or someone on the other end of the phone who cannot stop your paper delivery during your vacation. Worse, there’s no one at your local meeting, because when newspapers had more people on staff, they could afford to come to your traffic commissions, town council meetings, and panel discussions.

Nothing just happens, dear reader, but before we explore what’s going on, see if you can figure out this math: Recently, Tribune Publishing Co. announced that the company’s fourth-quarter profit was $4 million. That should be good news, but these days, newsroom blood-letting has moved from paper cuts to full-on beheadings.

And for that, you can thank Alden Global Capital, a New York-based hedge fund, which owns 32% of the Tribune company. Alden is known for one thing and one thing only: Alden kills newspapers. The corporation walks through the battlefield of struggling newspapers (which pretty much describes 99% of newspapers), lifts up the wounded, props them up at a computer, and then methodically sucks up all the resources until there’s nothing left. Their shady business practices — including an accusation that they moved employee pension assets into their own accounts — have earned the notice of the Department of Labor.

The next time you want to complain about your local coverage, remember that you have no idea how hard the dead-last-remainders of America’s newsrooms work to do what they do. They are part of a broken business model, but there is your reporter/photographer/editor, spinning as fast as s/he can.

I know. I was a remainder, until I realized I was so angry at the system I couldn’t exist in it. I left in 2012 when I thought things were pretty bad.

But this isn’t just me, a disgruntled former employee. Last May, some U.S. senators, including Sherrod Brown (husband of Pulitzer-winning newspaper columnist Connie Schultz), Tammy Baldwin and Cory Booker, wrote Alden a letter begging them to abandon their attempted hostile takeover of Gannett because newspapers are a “public good.” Gannett shareholders ultimately rejected the takeover.

Alden’s holdings include The Denver Post, where in December, members of the Denver City Council passed a resolution that called on the company to either invest in the Post or sell it. Alden has been draining the blood from that once-fine newspaper since 2011.

In January, two respected Chicago Tribune columnists wrote a New York Times op-ed calling attention to their own newspaper’s struggles as an Alden holding. In February, the Chicago City Council passed a resolution similar to Denver’s.

We need that here, in Hartford. We need a concerted effort to save the Oldest Continuously Published Newspaper in the Nation, the newspaper that printed a copy of the Declaration of Independence, and was sued for libel by Thomas Jefferson. We need a full-throated show of support, like that of state Sen. Saud Anwar and others. We, too, need to encourage Alden to put up or shut up. We, too, need wealthy people to invest in local journalism.

Mostly, we need to stop the dangerous trend that threatens our free press. According to the Pew Research Center, post-Watergate, the circulation of daily newspapers peaked in the late ’80s. About that same time, third-generation newspaper families began to lose interest in the family business, while corporations began to notice the healthy profit margins found in the newspaper industry. At a rate that accelerated as we barreled through the ‘90s, more and more newspapers became part of media conglomerates.

If the carnage continues, Alden will kill our newspaper. When that happens, we’re left with news deserts, with our “news” shoveled at us by social media, with its lack of fact-checkers and professionalism. Our information age will suffer from an appalling lack of information.

Passivity is not an option. This is our damn newspaper. This is our damn democracy.

Susan Campbell teaches at University of New Haven, and is the author of several books, including, most recently, “Frog Hollow: Stories From an American Neighborhood.” She can be reached at slcampbell417@gmail.com.

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