The media business analyst Alan Mutter once memorably asserted that newspapers’ “Original Sin” dates back to the mid 1990s, when they started giving away their journalism for free on the internet. Margot Susca, though, argues that the real fall from grace came roughly a decade later, when Fortress Investment Group paid $530 million to acquire Liberty Group Publishing, renaming it GateHouse Media. That transaction marked the beginning of the private equity era in journalism, an era defined by hollowed-out newsrooms and ghost newspapers that lack the resources to provide the communities they purportedly serve with the news and information they need.
Susca, an assistant professor of journalism at American University, tells the sad story of how private equity wiped out vast swaths of the newspaper business in “Hedged: How Private Investment Funds Helped Destroy American Newspapers and Undermine Democracy.”
There’s some very bad news coming out of Los Angeles this week. Kevin Merida, the executive editor of the Los Angeles Times, is stepping down after just two and a half years on the job. Merida, who previously held high-level jobs at The Washington Post and ESPN, is perhaps the country’s most prominent Black editor, and his departure raises serious questions about the LA Times’ owner, billionaire Patrick Soon-Shiong, who bought the paper in 2018.
Soon-Shiong has certainly been a better steward than a corporate chain or hedge fund would have been, but his time at the helm has been unsteady. He wants to grow toward profitability, but he keeps cutting the staff. Twice he has gone out of his way to deliver newspapers into the arms of the undertakers at Alden Global Capital, doing nothing to stop Alden’s acquisition of Tribune Publishing’s nine major-market dailies in 2021 and then selling The San Diego Union-Tribune to Alden in 2023.
Poynter media columnist Tom Jones notes that Soon-Shiong is now trying to reassure the LA Times newsroom that Merida’s departure will not lead to a similar fate:
Perhaps sensing the uneasiness of his newsroom, Soon-Shiong wrote in a note, “Our commitment to the L.A. Times and its mission has not wavered since the inception of our acquisition. However, given the persistent challenges we face, it is now imperative that we all work together to build a sustainable business that allows for growth and innovation of the L.A. Times and L.A. Times Studios in order to achieve our vision.”
Benjamin Mullin, writing in The New York Times, reports that Merida clashed with members of Soon-Shiong’s family over Merida’s edict that staff members who signed a petition condemning Israel’s war in Gaza would be temporarily banned from covering stories related to the war. Whether or not you think Merida was clinging to outmoded ethical standards, you can’t say that move was controversial. Indeed, two New York Times contributors resigned, apparently under pressure, after signing a similar letter.
At one time it looked like wealthy individual owners might be a solution to the news crisis — not that they could be expected to underwrite losses forever, but they could certainly provide the runway needed to build a new, sustainable business model. Now, with Jeff Bezos’ Washington Post floundering, it looks like the only wealthy newspaper owners who’ve fulfilled their promise are John and Linda Henry at The Boston Globe and Glen Taylor at the Star Tribune of Minneapolis.
Sadly, it’s hard to be optimistic about the future of the LA Times under Soon-Shiong.
The Buell Public Media Center in Denver, home of The Colorado Sun. Photo (cc) 2021 by Dan Kennedy.
Is there a silver lining hiding somewhere inside the rise of newspaper ownership by private equity? Brant Houston says yes. In a recent essay for the Gateway Journalism Review, Houston argues that what he calls the “Alden effect” has provided a significant boost to startup news projects as communities fight back against the destruction of their legacy newspapers. Alden is a reference to Alden Global Capital, a hedge fund that owns two newspaper chains, MediaNews Group and Tribune Publishing, which between them control about 100 papers. Houston writes:
Alden Global is a call to arms for the creation or expansion of alternative, and often nonprofit newsrooms. A call to arms that should have been sounded years ago.
Call it the Alden effect.
Alden’s brazen and brutal harvesting of a disrupted and distressed news industry has made clear the long death spiral of newspapers and legacy media. And it has made clear how a new business model for journalism (usually a nonprofit model or a public benefit corporation) is needed and how independent digital newsrooms need to form deeper alliances.
Houston is the Knight Chair in Investigative Reporting at the University of Illinois. He talked about his new book, “Changing Models for Journalism,” in an appearance last June on the “What Works” podcast. And a personal note: He was my first editor at The Daily Times Chronicle of Woburn, Massachusetts, way back in 1979.
In his Gateway article, Houston traces such Alden-driven moves as a closer relationship between two existing nonprofits, Voice of San Diego and inewsource, in response to Alden’s acquisition of The San Diego Union-Tribune; the merger of WBEZ and the Chicago Sun-Times following Alden’s takeover of the Chicago Tribune; the founding of The Colorado Sun by 10 Denver Post journalists who’d had enough of Alden’s cuts; and the wealthy hotel magnate Stewart Bainum’s decision to found a high-profile nonprofit, The Baltimore Banner, after he lost out to Alden in a bid to purchase Tribune Publishing, whose holdings include The Baltimore Sun.
Ellen Clegg and I encountered the Alden effect over and over in our reporting for our book, “What Works in Community News.” We might call it the “Alden and Gannett effect,” since we also examined communities whose newspapers had been shredded by Gannett, our largest newspaper chain with about 200 papers. In addition to Denver, the projects we write about that have their origins in cuts by Alden and Gannett include:
Memphis, Tennessee, where nonprofits such as MLK50 and the Daily Memphian are filling some of the gaps created by cuts at Gannett’s Commercial Appeal.
The Bedford Citizen, a small nonprofit in the Boston suburbs launched about a dozen years ago as Gannett’s predecessor company, GateHouse Media, hacked away at the local weekly and ultimately closed it.
Mendocino County, California, where two refugees from Alden papers started a digital site called The Mendocino Voice.
Santa Cruz, California, where two former employees of Alden’s Santa Cruz Sentinel founded a nonprofit called Santa Cruz Local and where a larger for-profit, Lookout Santa Cruz, is operating as well.
Starting a news project is grindingly hard work, and Ellen and I came away with enormous respect for the news entrepreneurs we interviewed. It would be easier if legacy newspapers had remained in the hands of local interests. But, as Houston argues, the rise of Alden, Gannett and other chain owners has provided a jolt to efforts aimed at reviving community-based journalism.
The historic Scranton Times building. Photo (cc) 2022 by Jeffrey Hayes.
Last summer came horrifying news from Scranton, Pennsylvania: the notorious hedge fund Alden Global Capital was buying the Scranton Times-Tribune and three sister papers from the Lynett family, the local publishers going back to 1895. The sale was taking place even though those members of the family who actually ran the papers opposed it. They were outvoted by other members of the family who simply wanted to cash out and get on with their lives. Ellen Clegg and I talked about it at the time on the “What Works” podcast.
What happened next was predictable and depressing. Washington Post media columnist Erik Wemple traveled to the Scranton area recently and filed a long, sad report about what he found (free link). The lowlights:
The news staff, already down to 40, a steep decline from 90 in the late 1990s, was immediately cut by another 10, with employees offered voluntary buyouts if they would just go away.
Newsrooms in Wilkes-Barre, Hazleton and Pottsfield were put up for sale. The Scranton Times’ headquarters was abandoned in late November, with journalists being told that most of them would be expected to work at home.
Some customer service calls were outsourced to the Philippines.
Almost immediately, Wemple writes, editorials about local and state issues were replaced with generic national content, which is exactly the opposite approach that researchers Joshua Darr, Matthew Hitt and Johanna Dunaway found is helpful in reducing political polarization. As Darr told Ellen in 2021:
It’s important for people to be able to express their opinions on national politics, and there are myriad ways to do that. But I don’t think there’s necessarily a good reason for local newspapers to devote some of their precious op-ed page space to things that aren’t local. I think they should be maximizing their comparative advantage in the marketplace by giving people things that they can’t get anywhere else.
There’s no question that the Pennsylvania papers were facing real challenges. As Wemple reports, paid circulation and advertising were both in a tailspin, and the Lynett family understandably was tired of subsidizing losses. But it didn’t have to end like this. Perhaps the best solution would have been for a local nonprofit institution to purchase the papers, as is the case at another Pennsylvania paper — The Philadelphia Inquirer, a for-profit entity owned by the nonprofit Lenfest Institute.
Steven Waldman, the president of Rebuild Local News, has proposed tax incentives and other measures to prevent newspapers from falling into the hands of cost-slashing chains. Unfortunately, such steps would not have come in time to save the Lynett papers.
Sadly, based on Wemple’s story, it doesn’t sound like much of an effort was made to find a buyer that would have operated the papers for the benefit of the public rather than for Alden’s wealthy investors. I just hope that some of the journalists who have lost their jobs will fight back by starting their own venture, as is happening in community after community across the country.
This message from the Boston Herald showed up in my inbox Tuesday night. Read the fine print. Not much attention to detail at MediaNews Group, the chain that owns the Herald and that, in turn, is part of the notorious hedge fund Alden Global Capital.
The release of a new report by Penelope Muse Abernathy on the state of local news is always a big deal. For 15 years now, she’s been tracking the extent of the crisis, and has done more than anyone to popularize the phrase “news deserts,” which describes communities without a source of reliable news and information. This week Abernathy, now at Northwestern University’s Medill School, issued “The State of Local News 2023.” It’s a downbeat report, although there are a few bright spots. Here’s a key finding:
The data and insights collected and analyzed in this 2023 report on The State of Local News paint the picture of a country and society increasingly divided between the journalism-have’s — mostly residents in more affluent cities and suburban areas where alternative news sources are gaining traction — and the journalism have-not’s, those in economically struggling and traditionally underserved metro, suburban and rural communities. This partitioning of our citizenry poses a far-reaching crisis for our democracy as it simultaneously struggles with political polarization, a lack of civic engagement and the proliferation of misinformation and information online.
Before I continue, a disclosure: Abernathy, who’s been a guest on our “What Works” podcast about the future of local news, was kind enough to provide a pre-publication endorsement of the book that Ellen Clegg and I have written, “What Works in Community News,” which comes out in January.
Abernathy’s principal collaborator on the new report is Sarah Stonbely, director of Medill’s State of Local News Project, who I interviewed in 2022 when she was at the Center for Cooperative Media, part of Montclair State University in New Jersey.
If you’d like a good summary of Abernathy and Stonbely’s report, I recommend Sarah Fischer’s overview in Axios, which leads with the prediction that the U.S. will have lost one third of its newspapers by the end of 2024.
The cleavage between affluent urban and suburban areas and less affluent urban and rural areas is one of the major challenges Abernathy and Stonbely identify, and it’s definitely something that Ellen and I noticed in our reporting for “What Works in Community News.” I recall asking folks at the start-up Colorado Sun why they were trying to stretch their resources to cover stories across the state rather than focusing on Denver. The answer: the Denver metro area was already fairly well served despite massive cuts at The Denver Post, owned by the hedge fund Alden Global Capital. By contrast, there was very little news coverage in the more rural parts of the state.
As Abernathy and Stonbely put it: “The footprint for alternative local news outlets — approximately 550 digital-only sites, 720 ethnic media organizations and 215 public broadcasting stations — remains very small and centered around metro areas.” Indeed, this chart tells a rather harrowing tale. As you can see, people who live in news deserts are considerably less affluent and less educated than the national average.
The report also includes a section called “Bright Spots in the Local News Landscape.” Although the interactive map is a little hard to navigate, I can see that several projects that Ellen and I profile in “What Works in Community News” are included, such as NJ Spotlight News, the Star Tribune of Minneapolis, The Texas Tribune, The Colorado Sun and the Daily Memphian.
The report also highlights The Boston Globe as one of its good-news stories, observing that, under the ownership of John and Linda Henry, the paper has thrived on the strength of its digital subscriptions. In a sidebar, Tom Brown, the Globe’s vice president of consumer analytics, tells Abernathy that digital growth continues, although at a slower rate than during the COVID pandemic. Retention is down slightly, too. “We are nonetheless still seeing overall strong retention,” Brown says, “and we are investing in several areas of the business with the goal of engaging subscribers more and, in particular, our new subscribers.”
Editor Nancy Barnes adds that though the Globe is ramping up its coverage of the Greater Boston area as well as in Rhode Island and New Hampshire, it can’t fill the gap created by the gutting and closure of local weekly papers at the hands of Gannett, the giant newspaper chain that until recently dominated coverage of the Boston suburbs and exurbs.
“Having returned to Boston after many years away, I have been stunned by the decimation of local newspapers across Massachusetts and New England,” Barnes says. “However, our coverage strategy is not tied to specific Gatehouse newspaper communities [a reference to Gannett’s predecessor company]. We cover greater Boston in depth, but we don’t have the bandwidth to be the local news source for everyone.”
This week’s Medill report is the first of a multi-part series. Future chapters will be released over the next few weeks and into January.
One of the more innovative efforts at saving newspapers from chain ownership is winding down, although the papers themselves remain protected. The Colorado Sun announced Wednesday that it would transfer its ownership shares of Colorado Community Media (CCM), a chain of 24 weekly and monthly papers in the Denver suburbs, to the nonprofit National Trust for Local News, which led the effort to buy the papers two years ago. The Sun had been given a stake in CCM in return for helping to run the papers.
The reason given for pulling out was that the Sun is in the process of converting from a for-profit public benefit corporation to a nonprofit, which I wrote about recently for Nieman Lab. A story in the Sun that appeared Wednesday urged nonprofit status for CCM as well: “Just as we believe that nonprofit is the right fit for The Sun, we believe it’s a good fit for these weeklies, too. That will be a decision for the Trust and the board of directors of the Colorado News Conservancy, the parent company of CCM.” No money is changing hands. (The Conservancy is the entity established by the National Trust and the Sun to run the CCM papers).
Sun editor and co-founder Larry Ryckman said on X/Twitter: “We’ve been proud co-owners of Colorado Community Media for 2 years & wish it well in this new chapter. They’re doing great work & deserve your support.” Linda Shapley, publisher of CCM, was quoted in the Sun as saying: “I’m grateful for The Sun’s support at a time that was most critical for our future At Colorado Community Media, we’re excited to be part of the evolving Colorado news ecosystem, and we’re dedicated to serving our communities with timely, factual news and information.”
The Sun and CCM are the subject of a chapter in “What Works in Community News,” a book about the future of local journalism by Ellen Clegg and me that will be published in January. In September 2021 I spent nearly a week in Denver reporting on Colorado’s media ecosystem. Obviously that ecosystem is still in flux, but the period covered by our book ends in late 2022.
I believe what was taking place in Colorado back then is a story still worth telling: the founding of the Sun by 10 journalists who’d quit The Denver Post following deep cuts by its hedge-fund owner, Alden Global Capital; the Sun’s early hopes of raising money through blockchain technology; its unique governance structure; and its participation in the acquisition of CCM.
Ellen and I look at our book not as a standalone entity but, rather, as the hub of an ongoing story that also comprises updates to our website, a podcast (Shapley, National Trust executive director Elizabeth Hansen Shapiro, and former Denver Post editor Greg Moore have all been guests, and we hope to have Ryckman on once the book has been released), and an evolving social media presence (we’re currently on X/Twitter and Mastodon, but that may change).
So of course we want you to read our book. But we also hope you’ll turn to our other platforms to keep up on the latest.
As I noted Thursday, one of the few positive contributions Rupert Murdoch can take credit for is preserving The Wall Street Journal as a great national newspaper. Another is that he saved the Boston Herald — not once, but twice. Larry Edelman of The Boston Globe writes about the first time (he interviewed me). I tell that story as well as the tale of Murdoch’s second rescue in my 2018 book “The Return of the Moguls,” which I excerpt below.
The Hearst chain, which had converted the Herald (known then as the Herald American) to a tabloid during the final years of its ownership, had run out the string by 1982. I remember one old-timer telling me that, with closure just hours away, workers came in to rip out the vending machines from the paper’s hulking plant in the South End. At the last minute, Murdoch reached a deal with the unions and the paper was saved.
Under Murdoch’s ownership, the Herald established itself as a feisty alternative to the Globe, sometimes beating its larger rival on important local stories. That continued in the 1990s after Murdoch’s protégé Pat Purcell bought it from him. To this day there are people who believe that Murdoch continued to pull the strings behind the scenes, but I never believed it. Murdoch just didn’t care that much about the Herald, and I don’t doubt that he let Purcell have it on extremely favorable terms.
Unfortunately, the Herald’s financial model pretty much stopped working in the early 2000s, and today it’s owned by the New York hedge fund Alden Global Capital, famous for sucking the life out of its papers. Alden owns two other Massachusetts papers as well — The Sun of Lowell and the Sentinel & Enterprise of Fitchburg.
At one time Murdoch also owned the Ottaway chain, which included the Cape Cod Times and some small weeklies, including the Middleboro Gazette, where I grew up. Murdoch is fondly remembered by taking a hands-off approach, but I honestly wonder whether he even knew those papers were part of his empire. The Gazette was later closed by the Gannett chain, and today Middleborough is served by an independent startup, Nemasket Weekly.
Here’s what I wrote in “Moguls” about the Herald and Murdoch’s TV station, WFXT-TV (Channel 25), which he sold off a few years ago. The “endless struggle” I refer to was the Herald’s long-time ownership of Channel 5, an existential threat to the Globe that was removed when the Globe reported that its rival had gained the broadcast license because of corruption at the Federal Communications Commission. The Herald was stripped of its license in 1972, and Hearst swooped in to pick up the pieces.
The Globe’s endless struggle with the Herald’s broadcast ambitions played itself out in one last, faint echo in 1988, when Murdoch, who then owned the Herald, purchased Channel 25. Ted Kennedy, by then a leading member of the Senate, quietly slipped a provision into a bill that made it almost impossible for the FCC to grant a waiver to its rule prohibiting someone from owning both a daily newspaper and a TV station in the same market. At the time, I was a reporter for The Daily Times Chronicle, which served Woburn and several surrounding communities north of Boston. I remember covering a local appearance by Kennedy as he was dogged by the Herald reporter Wayne Woodlief. “Senator, why are you trying to kill the Herald?” the persistent Woodlief asked him several times.
Murdoch chose to sell off Channel 25, thus saving the Herald; he repurchased the TV station after selling the Herald to Purcell. But the Herald columnist Howie Carr remained bitter. He told me years later that Kennedy’s actions were worse than [Globe ally Tip] O’Neill’s, since O’Neill was just trying to help one of several papers rather than destroy the Globe’s only daily competitor. “I think Tip was just trying to get an ally,” Carr said, “whereas Ted was trying to kill the paper in order to deliver the monopoly to his friends.”
The liberal reputation the Globe developed during the Winship era was cemented during Boston’s school desegregation crisis of the mid-1970s, when the Globe wholeheartedly supported federal judge Arthur Garrity’s order to bus children to different neighborhoods in the city to achieve racial balance. It was a terrible time in Boston, as white racism ran rampant and bullets were fired into the Globe’s headquarters and at one of the paper’s delivery trucks. The Globe took the right moral stand, and its coverage earned the paper its second Pulitzer for Public Service. Winship in those years enjoyed a reputation as one of the finest editors in the country. But it was also during those years that the Globe became known as the paper of Boston’s suburban liberal elite and the Herald that of the urban white working class, a dichotomy that has persisted to this day.
Paul Bass checks the 2021 New Haven election returns. Photo by Maaisha Osman. Used with permission.
On the latest “What Works” podcast, Ellen Clegg and I talk with Paul Bass, the founder and former editor of the New Haven Independent. Bass is originally from White Plains, New York, but he arrived in New Haven in the late 1970s to attend Yale, and he has been reporting on all the quirks and glory of his adopted hometown ever since.
Bass was the main subject of my 2013 book, “The Wired City,” and is one of the news entrepreneurs featured in our forthcoming book, “What Works in Community News.” Bass launched the New Haven Independent in 2005 as an online-only nonprofit.
Last fall, Bass announced he was stepping aside as editor, handing the top job over to managing editor Tom Breen. But he’s continuing to play a role at the Independent and its multimedia arms, and he has just begun another venture: the Independent Review Crew, which features arts and culture reviews from all over, including right here in Boston via Universal Hub.
Ellen has a Quick Take on The Texas Tribune, the much-admired nonprofit news outlet started by Evan Smith and others in Austin. The Tribune has been a model for other startups, so it rocked the world of local news last month when CEO Sonal Shah announced that 11 staffers had been laid off.
I report on another acquisition by Alden Global Capital, the New York-based hedge fund that has earned scorn for the way it manages its newspapers. Alden acquired four family-owned newspapers in Pennsylvania. Worse, the family members who actually ran the papers wanted to keep them, but they were outvoted by the rest of the family.
At least two daily newspapers owned by Alden Global Capital’s MediaNews Group will end reader comments on July 1.
The Boston Herald announced the move earlier today, saying that the change was being made to “dramatically speed up the performance of the website” as well as on its mobile platforms. The Denver Post took the same action last week, although editor Lee Ann Colacioppo cited bad behavior rather than technology, writing that the comment section has become “an uncivil place that drives readers away and opens those trying to engage in thoughtful conversation to hateful, personal attacks.”
Both papers emphasized that readers will still be able to talk back at them through social media platforms.
Wondering if this were a MediaNews-wide action, I tried searching about a half-dozen papers in the 60-daily chain and could find no similar announcements. I found something else interesting as well. The eight larger dailies that comprise the Tribune Publishing chain, which Alden acquired a couple of years ago, are now included as part of MediaNews Group, although they are still listed separately as well. (A ninth, the Daily News of New York, was split off from Tribune and is being run as a separate entity.)
The moves by the Herald and the Post represent just the latest in the long, sad story of user comments. When they debuted about a quarter-century ago, they were hailed as a way of involving the audience — the “former audience,” as Dan Gillmor and Jay Rosen put it. The hope was that comments could even advance stories.
It turned out that comments were embraced mainly by the most sociopathic elements. Some publishers (including me for a while) required real names, but that didn’t really help. The only measure that ensures a civil platform is pre-screening — a comment doesn’t appear online until someone has read it and approved it. But that takes resources, and very few news organizations are willing to make the investment.
The best comments section I know of belongs to the New Haven Independent, where pre-screening has been the rule right from the start. Keeping out racist, homophobic hate speech opens up the forum for other voices to be heard. The New York Times engages in pre-screening as well.
So kudos to the Boston Herald and The Denver Post — and I hope other news outlets, including The Boston Globe, will follow suit.
The media business analyst Alan Mutter once memorably asserted that newspapers’ “Original Sin” dates back to the mid 1990s, when they started giving away their journalism for free on the internet. Margot Susca, though, argues that the real fall from grace came roughly a decade later, when Fortress Investment Group paid $530 million to acquire Liberty Group Publishing, renaming it GateHouse Media. That transaction marked the beginning of the private equity era in journalism, an era defined by hollowed-out newsrooms and ghost newspapers that lack the resources to provide the communities they purportedly serve with the news and information they need.
