The indispensable Boston Business Journal reports that John Henry may be close to selling the Telegram & Gazette of Worcester, the “other” newspaper he acquired when he purchased The Boston Globe.
Craig Douglas writes that the T&G may end up in the hands of GateHouse Media, which recently implemented cuts at its two newest Massachusetts properties, the Cape Cod Times and The Standard-Times of New Bedford.
I’d like to think that Henry would sell to local owners if he could find any. The T&G may be a tough acquisition at this point, and GateHouse may be among the few prospective buyers willing to take it on.
My hope is that GateHouse, which is going through a structured bankruptcy aimed at getting $1.2 billion in debt off its back, will prove to be a better steward of the T&G than we’ve come to expect.
GateHouse’s recent move at its weekly papers in Massachusetts — reallocating resources from weaker to stronger papers rather than engaging in out-and-out cuts — offers some reason for optimism.
Update: Henry has what sounds like good news, according to the T&G — no sale before 2014, plus he’s hoping for a local buyer.
Big news out of GateHouse Media today, but what happened isn’t entirely clear. From what I’ve been able to figure out, the struggling company has decided to close or combine some of its weaker weekly papers in Massachusetts and pump additional resources into about 10 stronger ones.
South of Boston, for instance, I’m told that the Norton Mirror will be folded.
And for an example of a combination: the Stoneham Sun, the Reading Advocate and the Wakefield Observer will be grouped. There will still be three separate papers, but most of their pages will be common to all three.
I also hear there will be no layoffs accompanying this particular restructuring, though some job descriptions may change.
GateHouse, based in suburban Rochester, N.Y., publishes about 100 weekly papers in Eastern Massachusetts as well as several dailies.
In September I asked (here and here) whether Rupert Murdoch’s 33 Dow Jones community newspapers might face cuts once they were sold to Newcastle Investment Corp., which is affiliated with GateHouse Media. Over the weekend we got the answer: yes, indeed.
Locally, the Cape Cod Times and The Standard-Times of New Bedford, both of which enjoy excellent reputations, will have to make do with a lot less. Seven full-time and 10 part-time employees have been cut at the Cape Cod Media Group, which comprises the Times and several affiliated publications. Twelve newsroom jobs were eliminated, with 10 people being laid off.
Similarly, four full-timers and four part-timers were let go at the SouthCoast Media Group, which is dominated by The Standard-Times. The story does not say how many of those employees were on the news side.
Peter Meyer, the publisher of both papers, was quoted in The Standard-Times as saying:
It is important to know that new ownership is not at fault for today’s actions. Any buyer would have taken similar measures based on financial realities. This was a painful but necessary step to position the SouthCoast Media Group for future success.
Essentially the same statement ran in the Cape Cod paper. Yet Meyer also says the papers in both groups remain profitable, though not as profitable as they were in 2009. Which means that the new owners could have invested in growth — admittedly, a dicey proposition — rather than bet on continued shrinkage.
I could not find any announcement for the Portsmouth (N.H.) Herald, the third major local daily that Dow Jones sold in September. But Jim Romenesko reports that the Times Herald-Record of Middletown, N.Y., got rid of all four of its staff photographers and will now rely on freelancers — reminiscent of the move made by the Chicago Sun-Times earlier this year. Three newsroom managers were let go as well.
“I’m getting reports today of ‘bloodbaths’ at some of the former Dow Jones papers,” Romenesko wrote on Friday.
GateHouse, currently going through a structured bankruptcy, owns about 100 community newspapers in Massachusetts, most of them weeklies.
Just catching up with this. Jon Chesto of the Boston Business Journal reports that The Boston Globe’s Your Town sites are being trimmed by six correspondents — approximately half the staff. Your Town, part of the Globe’s free Boston.com website, provides hyperlocal coverage of the suburbs as well as of several Boston neighborhoods.
Globe regional editor David Dahl tells Chesto that there will be no site closures. But it seems inevitable that there will be cuts in coverage, even though Globe staff reporters and freelancers will continue to contribute. There are more than 100 Your Town sites and about 15 related Your Campus websites covering colleges and universities in Greater Boston.
Your Town got off to a shaky start in 2008, as GateHouse Media — which operates Wicked Local sites in virtually all of the same communities targeted by Your Town — sued the New York Times Co. (the Globe’s owner, at least for a few more weeks) for copyright infringement, arguing that the Your Town sites in some cases aggregated virtually all of GateHouse’s content for a given community without offering much else.
The two sides reached an out-of-court settlement in early 2009, as I reported for The Guardian. Your Town eventually grew into a valuable resource in many communities. But it looks like the sites, which carry little advertising, got to be too expensive to operate.
Chesto writes that the cuts call hyperlocal coverage into question as a business strategy, noting that AOL’s Patch sites are in the midst of deep cuts as well. But though hyperlocal may well be a loser at the corporate chain level, there are a number of successful independent sites operating across the country. You could read a book about such sites, hint, hint. The real issue is that hyperlocal is best understood as a grassroots phenomenon.
Did Globe executives reach this decision on their own? Or was incoming owner John Henry involved? And if he was, what does that say about his priorities for the Globe?
(Disclosure: Journalism students at Northeastern as well as several other Boston colleges and universities contribute to the Your Town and Your Campus sites.)
The Boston Business Journal has come up aces during the past week with two meaty stories on local media news.
• A shaky future at the Globe. The first, published last Friday, found that confidential financial documents put together by the New York Times Co. suggest The Boston Globe was in slightly worse shape than outside observers might have imagined when the paper and several affiliated properties were sold to Red Sox principal owner John Henry for $70 million in early August. The BBJ’s Craig Douglas writes (sub. req.):
In essence, Henry is buying into a borderline breakeven enterprise already teed up for $35 million in cost cuts over a two-year period before he even walks through the door.
How bad is it? According to the documents cited by Douglas, advertising revenue at the New England Media Group (NEMG) — mainly the Globe, the Telegram & Gazette of Worcester and Boston.com — is expected to be 31 percent below the 2009 level next year. And paid print circulation revenue continues to slip despite price increases at the Globe and the T&G.
You may have heard people say at the time of the sale that Boston.com was worth more than the Globe itself. Well, I don’t think you’ve heard me say it. Print advertising remains far more valuable than online, and that holds true at NEMG as well. Douglas writes:
The Globe is by far the biggest revenue generator of the group, accounting for 69 percent, or about $255 million, of its forecasted revenue this year. The Telegram & Gazette in Worcester is next in line at $42.5 million in forecasted revenue this year, while Boston.com is on track to book about $40 million.
Print products account for about 88 percent of NEMG’s total annual revenue. That heavy reliance on print-related advertising and circulation revenue has proven particularly problematic of late, as both categories have lost ground since 2009 and are forecasted to see continued deterioration for the foreseeable future.
Douglas’ story is protected behind a paywall, but if you can find a print edition, you should. Suffice it to say that John Henry has his work cut out for him. The picture Douglas paints is not catastrophic. But it does show that the Globe is not quite as far along the road toward figuring out the digital future as some of us might have hoped.
• Tough times ahead for local papers. The other big media splash, which I linked to last night, is Jon Chesto’s analysis of the sale of Rupert Murdoch’s Dow Jones Local Newspaper Group (formerly Ottaway Newspapers) to an investment firm affiliated with GateHouse Media. The papers sold include three prominent Greater Boston dailies: The Standard-Times of New Bedford, the Cape Cod Times and the Portsmouth Herald, on the New Hampshire seacoast.
Chesto’s article is part of the BBJ’s free offerings, so by all means read the whole thing. It’s a real eye-opener, as he explains as best anyone can at this early stage what the sale and simultaneous bankruptcy of GateHouse will mean for local papers and the communities they serve. Unfortunately, indications are the news will be very bad indeed.
Fairport, N.Y.-based GateHouse, which publishes about 100 local papers in Eastern Massachusetts (including The Patriot Ledger of Quincy, The Enterprise of Brockton and The MetroWest Daily News of Framingham), will somehow be combined with the entity that holds the former Ottaway papers into a new company with the uninspired name of New Media (that may change). (Update: Chesto is a former business editor of The Patriot Ledger, which no doubt helped him write his piece with a real air of authority. And thanks to Roy Harris for reminding me of that.)
The deal with Murdoch — at $82 million, quite a bit more than I had anticipated — was done through Newcastle Investment Corp., a real estate investment trust that is part of Fortress Investment Group, which in turn is GateHouse’s principal backer.
The powers-that-be are already talking about slashing the Ottaway papers, which are among the best local dailies in the region. Chesto writes:
The papers are described as “under-managed by News Corp.” with “expense reductions of only 6% since 2010.” Translation: We can take more out of the expenses than News Corp. did. GateHouse has been an aggressive cost cutter in recent years, most notably with efforts to consolidate most of its page design and layout functions. That work was centralized in two locations, including an office in Framingham. But it will soon be downsized further, into one location in Austin, Texas.
Yes, Murdoch, the “genocidal tyrant,” is likely to prove a better steward of local journalism than the people he’s selling to.
Post-bankruptcy, with $1.2 billion in debt off their backs, the executives now running GateHouse are going to be empowered. According to a presentation put together for investors, Chesto writes, New Media may spend $1 billion to buy up local media companies over the next three years.
Chesto doesn’t say so, but if I were working for the Eagle-Tribune papers north of Boston (The Eagle-Tribune of North Andover, The Daily News of Newburyport, The Salem News and the Gloucester Daily Times), I’d be polishing that résumé right now. On the other hand, those papers have already been cut so much under the Alabama-based CNHI chain that it’s not like a new owner could do a whole lot worse.
At a time when there are reasons to be hopeful about the newspaper business thanks to the interest of people like John Henry, Jeff Bezos and Warren Buffett, the GateHouse deal shows that there are still plenty of reasons to be worried about the future.
We tried hard to make our website’s comments feature a forum for the exchange of opinion and information.
We failed.
Sure, many commenters posted thoughtful remarks and adhered to the highest standards.
But far too many used the feature to spew vitriol, bigotry, obscenity, cheap shots and juvenile taunts, no matter how hard we worked to keep the conversation civil.
The Eagle-Tribune will let people register under their real names using either Facebook or Disqus.
White also raises an interesting issue — that news-site comments may have run their course, as much of the online conversation has shifted to Facebook, Twitter and other social media. “We have almost 8,000 Twitter followers, for example, 5,000 on our text alert service and more than 4,000 on Facebook,” he writes. “Those numbers are growing. I’d guess we have fewer than 100 ‘regulars’ commenting on Disqus, and that number appears to be shrinking.”
It’s a phenomenon I and many others have noticed. Comments on Media Nation posts have dropped off considerably in recent years. But when I link to a Media Nation post on Facebook, the responses roll in.
Some sites, like the New Haven Independent, have done a good job of integrating anonymous comments into the conversation. But a real-names policy can definitely be part of a well-tended comments garden. Good move on The Eagle-Tribune’s part.
For those of a certain age, perusing the ads posted at The Batavian, a for-profit news site in Batavia, N.Y., can seem a lot like flipping through the pages of a weekly community newspaper a generation or two ago.
Which is to say there are a lot of ads — more than 140, every one on the home page, a practice that publisher Howard Owens believes is more effective than rotating them in and out. There are ads for funeral homes and pizza shops. For accountants and tattoo parlors. For auto-repair centers and ice-cream stands. For bars and baseball (the minor-league Batavia Muckdogs).
The success of The Batavian matters to the future of local journalism. In my book “The Wired City: Reimagining Journalism and Civic Life in the Post-Newspaper Age,” I devote most of my attention to the New Haven Independent, a nonprofit site that subsists on grant money, donations and sponsorships. At this early stage of online news, nonprofits like the Independent are often able to raise more money more quickly than for-profits. But not every community can support a nonprofit. Thus it is vital for the future of news that entrepreneurs like Owens figure out the for-profit side — which is why I also devote a fair amount of space in “The Wired City” to what’s going on in Batavia.
Owens launched The Batavian in 2008 as a demonstration project for GateHouse Media, where he was the director of digital publishing. When his position was eliminated in early 2009, he asked GateHouse if he could take the fledgling site with him. He was granted his wish.
The Batavian is free and covers not just the city of Batavia (population 15,000) but surrounding Genesee County (60,000) as well. It receives about 80,000 unique visitors per month, according to Quantcast. That’s roughly the same as the site’s newspaper competition, The Daily News, also based in Batavia. (Web analytics are imprecise, and Owens says his internal count, provided by Google Analytics, shows about 118,000 uniques per month.) Of course, The Daily, as the locals call it, depends mainly on print distribution. On the other hand, The Batavian covers just one county to The Daily’s three, making Owens’ online reach all the more impressive.
The Batavian’s 12-month projected revenues are currently about $180,000 a year — enough to provide Owens and his wife, Billie Owens, the site’s part-time editor, with a comfortable living, and to employ a part-time sales and marketing coordinator. Unlike AOL, with its struggling network of Patch sites, The Batavian is independent, and Owens aims to keep it that way. As the Authentically Local project, of which The Batavian is a part, puts it: “Local doesn’t scale.”
Howard Owens
If a nonprofit like the New Haven Independent can raise more money than a for-profit (indeed, Independent founder and editor Paul Bass chose the nonprofit route in 2005 because he realized he couldn’t support himself with a for-profit), there are nevertheless certain advantages to for-profit online journalism. Let me outline three of the more obvious.
• Anyone can start a for-profit news site. The nonprofit route requires approval from the IRS and support from local foundations. In many cases, neither may be forthcoming — and as I recently wrote, the IRS has all but halted approval of 501(c)(3) status for nonprofit news sites, which they depend on so that donors can make tax-free contributions. By contrast, all it takes to launch a for-profit site is talent, experience and a willingness to work hard. That’s no guarantee of success, but the opportunity is there for all.
• Local ads enhance the vibrancy of a site. Owens likes to say that advertising is content. The ads at The Batavian give you a good feel for Genesee County — and provide a context for Owens’ coverage of everything from court news to traffic accidents, from school events to development proposals. Advertising and news work together to provide a well-rounded picture of the community. Yet you won’t see ads at a nonprofit site like the Independent, save for a few image-building “sponsorships” from local institutions such as college and hospitals.
• For-profit sites enjoy the full protection of the First Amendment. Like public radio and television stations, but unlike the vast majority of newspapers, nonprofit news sites are legally prohibited from endorsing candidates for public office. “Editorial endorsements — or the denial of them — are among the most powerful tools that newspapers have for holding political figures to account,” write the media scholar Robert McChesney and the journalist John Nichols in their 2010 book “The Death and Life of American Journalism: The Media Revolution that Will Begin the World Again.” The Batavian hasn’t actually endorsed any candidates, but at least it’s not legally prohibited from doing so — and Owens takes strong stands on other local issues without having to worry about the federal government swooping in and threatening his livelihood.
***
When I visited Batavia in 2009, I rode along with Owens as he made sales calls and covered stories in Genesee County. It seemed like a hard slog. At one point, as we were driving through the tiny farm town of Stafford, he gestured to a well-manicured golf course. “If you find out that I’ve joined the Stafford Country Club,” he said, “then I’ve been successful.” Two years later, I asked him about the status of his country club aspirations. He laughed. “I’d love to join the Stafford Country Club and have time to enjoy the privileges thereof,” he said, “but we’re probably years away from doing that.”
Yet The Batavian keeps growing. Last week the site announced a new real-estate ad partnership. Recently Owens told me he now spends virtually none of his time on ad sales, having offloaded that task to his part-time employee. The Owenses are able to devote the bulk of their time to journalism — something that was not the case when I was researching “The Wired City.”
Owens likes to remind people that we’re at the very beginning of online news as a business, and that what appears not to add up economically today may look quite different a few years from now. As Owens asked in a provocative blog post four years ago: “If it took newspapers more than 100 years to build the business and content models that we all now cherish, why do we expect a fully formed online model to emerge in just 10 years?”
Anonymous commenter reacts to new GateHouse policy
Friday update: MetroWest Daily News columnist Julia Spitz offers her take.
Yet another major news organization is fighting back against the scourge of anonymous, hateful comments. GateHouse Media, a national chain that owns about 100 newspapers in Eastern Massachusetts, is now requiring readers to use their real names and log in via Facebook or LinkedIn. The new rules kick in today.
For some time, we’ve received complaints that the anonymous commenting system we’ve hosted on our online stories does little to enhance the conversation within our community. The criticism has been that some of the comments are hateful and sometimes, downright objectionable. We heard you and we agree.
Most of GateHouse’s Massachusetts papers are community weeklies, but there are also a few medium-size dailies — most prominently The Patriot Ledger, The Enterprise of Brockton, The MetroWest Daily News of Framingham and The Milford Daily News.
The new policy pertains to all of GateHouse’s properties, which include more than 300 daily and weekly papers, according to a tweet from Nicole Simmons, regional digital editor for GateHouse Media New England.
In discussing the new policy on Facebook this week, I’ve seen praise for the decision to banish anonymity and criticism for relying on third-party services such as Facebook and LinkedIn. My sense is that the new policy is a step in the right direction, and how well it works will depend on the willingness of local editors to engage with their audience.
I’m late to this, and apologies to my informants who tried to tip me off earlier in the week. But Jon Chesto of the Boston Business Journal reports that GateHouse Media has announced it will close down the two “page production hubs” it opened just last year — one in Framingham, the other in Rockford, Ill.
The closures will result in the loss of “dozens of jobs,” Chesto writes, though at some point the two facilities will be replaced by a new “Center for News and Design.”
GateHouse, a national chain based in Fairport, N.Y., owns about 100 community newspapers in Eastern Massachusetts — mostly weeklies, but also midsize dailies such as The Patriot Ledger of Quincy, The Enterprise of Brockton and The MetroWest Daily News of Framingham.
Staggering under $1.2 billion in debt and flirting with bankruptcy, as The Wall Street Journal reports, GateHouse is a poster child for what’s wrong with corporate chain ownership of local news organizations.
There are a lot of fine journalists at GateHouse’s Massachusetts papers, doing a good job under difficult circumstances. But local doesn’t scale. Producing pages for some 300 papers nationwide out of one (or two) central facilities is fundamentally a bad idea, and it only matters a little bit whether it’s done competently or not.
The Cohasset selectmen have backed away from their plan to subpoena The Patriot Ledger of Quincy and its sister paper The Cohasset Mariner in an attempt to find out whether town employees have been posting offensive anonymous comments to the two papers’ websites, according to a report by Patrick Ronan.
The papers are part of the GateHouse Media chain.
Still at issue is a former selectman who’s pursuing a libel action against two anonymous commenters, and who subpoenaed the Mariner in an attempt to find out who they are. According to an article published on the Ledger and Mariner websites, the papers turned over the information as requested.
According to Ronan’s story, town officials have decided to wait and see if the libel suit reveals that any of the comments in question were posted from town computers.
