David Arkin, a top official with GateHouse Media, is leaving the company for a position in Texas. The following is a memo to employees from GateHouse chief executive Kirk Davis.
It is with very mixed feelings that I write to tell you that David Arkin, our Senior Vice President for Content and Product Development will be leaving GateHouse to become Chief Content Officer for Community Impact, a group of 21 award winning, hyper-local newspapers serving communities in the Austin, Dallas-Fort Worth and Houston markets. The free newspapers have a total circulation of 1.6 million.
I have worked with David for nearly 10 years and watched him develop from a lot of raw talent, to a truly great leader of our news and digital operations. I’m sad to lose that. However, for David, this new role means getting back into community journalism and a lot less travel (and more time with his family, including his three young children). I know he’s excited about that and I’m excited for him.
David has accomplished an enormous amount over the last several years. He launched our Center for News & Design in May of 2014 which today provides editing and design services for 220 GateHouse newspapers and is also home to More Content Now, our niche content business, and Community Content, which processes briefs and events for our papers. Reflecting the quality of its work, the Center has recently begun to take on significant commercial clients.
David used our centralized content services platform to develop innovative programs focused on quality journalism. For example, Pinnacle, our national enterprise reporting mentorship program, continues to produce great work like the recent piece examining the impact of substitute teachers in America.
Finally, David has led the transition of our newsroom culture from print to digital to mobile first. He initiated large-scale programs like reporter-produced video, social media engagement and digital journalism training, and focused our newsrooms on new, organizational structures and the use of digital analytics. And, most recently,
David led the development of the new, Garcia-designed responsive sites that we are currently rolling out.
David has accomplished all this with the support of a terrific team, including Tom Clifford, recently hired as VP of the Center for News and Design. We are confident that this team will continue to do a great job supporting our GateHouse operations. We will begin the process of identifying David’s replacement immediately.
In our discussions about what was a difficult decision, David shared how proud he is of his team and the digital transformation work happening across GateHouse newsrooms today. David also spoke to how much he values the relationships he has developed over the past decade with hundreds of GateHouse journalists.
David’s last day will be July 7th. Please join me in wishing David all the best!
Two of GateHouse Media’s top executives have sent a memo to the company’s publishers and editors—marked “CONFIDENTIAL”—arguing that a bid to provide services to the city of Quincy through its Propel Marketing subsidiary would not have represented a conflict of interest for GateHouse’s Quincy-based daily newspaper, the Patriot Ledger. I obtained a copy of the memo last night.
“There was never a plan to ask the newsroom for favorable coverage, reflecting a clear separation of church and state,” says the memo from GateHouse CEO Kirk Davis and senior vice president David Arkin. “Just as a politician can buy an ad and have no expectation for favorable coverage, Propel sells marketing services with absolutely no expectation for involvement by our newsrooms.”
The memo follows a report from Jack Sullivan of CommonWealth Magazine that the city rejected the bid in part because Mayor Thomas Koch “was concerned about ethical conflicts if the owner of the city’s major newspaper went to work promoting the image of the municipality.” The GateHouse bid proposal cited the company’s “expertise” at “delivering measurable results for our partners in traditional media, digital media, and digital services as well as having considerable content generation serving The City of Quincy tourism, news, and business.” (Note: I’m quoted in Sullivan’s article.)
If Davis and Arkin are sincere, then they should make sure bid language such as that used in the Quincy bid proposal is not repeated. It would also help if the Patriot Ledger would follow up on its earlier story about the bid by noting that it has since been rejected.
The full text of Davis and Arkin’s memo follows:
FROM: Kirk Davis, CEO of GateHouse and David Arkin, Senior Vice President of Content & Product Development
TO: Publishers and Editors
RE: Propel Marketing Campaign
Coming off the heels of this week’s Editors Conference and the release of our News Transparency guidelines, we wanted to be very clear about an issue in New England this week. The city of Quincy, MA, issued a request for proposal to market the redevelopment of the Quincy Center, a retail area. The RFP specified three primary services in its scope:
Amplify Quincy’s story: Develop and implement a marketing campaign that projects Quincy’s image in print, broadcast, digital and social media
Cultivate Positive Media: Leverage and develop relationships that result in positive media about Quincy development opportunities and current hospitality opportunities
Hospitality Business Development: Cultivate chefs and restauranteurs to locate and invest in Quincy’s downtown.
Propel Marketing (owned by GateHouse Media) and the GateHouse Media New England group responded to only the first of the three services in the RFP scope, amplifying Quincy’s story with a marketing campaign. Propel had no intent of cultivating positive media, nor did they intend to cultivate chefs and restauranteurs, as the former is inappropriate and the latter not their expertise.
Propel Marketing created and submitted a proposal for an advertising and marketing campaign. The proposal included digital marketing services, print ads in local GateHouse newspapers and online display ads on WickedLocal.com. The proposal did not include any form of native advertising, sponsored content or branded content. Nor did it include any mention of blogs, blog posts or articles.
The proposal was submitted from GateHouse Media, rather than from Propel Marketing, because it included both Propel services and GateHouse newspaper ads, in print and online.
Neither the Propel sales rep, nor the GateHouse sales rep, had conversations with editorial staff about Quincy Center coverage. There was never a plan to ask the newsroom for favorable coverage, reflecting a clear separation of church and state. Just as a politician can buy an ad and have no expectation for favorable coverage, Propel sells marketing services with absolutely no expectation for involvement by our newsrooms.
We take the independence of our news coverage incredibly seriously and are committed to ensuring that our standards are upheld in every area of our business.
Mark Henderson is certainly not the first person to launch a hyperlocal website in the shadow of the daily newspaper that used to employ him. Nevertheless, his ideas about how to build the site into a sustainable business are unorthodox enough to merit attention.
Henderson, a former executive with the 150-year-old Telegram & Gazette of Worcester, Mass., unveiled the Worcester Sun in August. From the start, the Sun’s content has been protected behind a hard paywall of $2 a week. There are no discounts; if you want to subscribe for a year, it will cost you $104.
Once the Sun has attracted a critical mass of paid digital subscribers (Henderson won’t reveal the magic number except to say that it’s well short of 1,000), he’ll add a Sunday paper for $1 a week, perhaps as soon as next spring. Print matters, Henderson says, because that’s still where most of the advertising is.
“If you’re going to start something new, monetizing digital is tough,” says Henderson. “And you can’t look at print as a medium without understanding that there is a ton of money still to be made there. Especially in Sunday print. We could use Sunday print to boost us into the stratosphere, to get us into a stable orbit where we can launch other things.”
Bootstrapping paid digital to break into paid print? Matt DeRienzo, interim executive director of Local Independent Online News (LION) Publishers, says he’s skeptical but intrigued. “Sunday print is going against the grain. There’s a lot of reasons the cards are stacked against them,” says DeRienzo, the former editor of Digital First Media’s Connecticut publications, which include the New Haven Register. But he adds: “The best ideas are going to come from people who live in and care about their community and who are closest to the problem. Who’s to say it’s not going to work?”
With a population of 183,000 — the second-largest city in New England after Boston — and a median household income of about $46,000, more than $20,000 below the state average, Worcester is a city facing economic challenges. It’s precisely the sort of community that could benefit most from independent media projects such as the Sun, says Catherine Tumber, a scholar with the Dukakis Center for Urban and Regional Policy at Northeastern University.
Last week, I met Henderson and his business partner (and cousin) Fred Hurlbrink Jr. in a brightly lit coworking space on the first floor of the Innovation Center of Worcester — formerly the Franklin Street headquarters of the Telegram & Gazette, the daily newspaper where Henderson worked for nearly 25 years. Across the street is City Hall and the Worcester Common. On the other side of the common looms the mid-sized tower that is the current home of the T&G.
Henderson, 49, rose from the paper’s sports department to deputy managing editor for technology and, starting in 2009, online director. He left on June 2, 2014, the day that John Henry, who had purchased The Boston Globe and the T&G from the New York Times Company, sold the T&G to Halifax Media Group of Daytona Beach, Florida, after previously saying he intended to sell to a local group. Halifax cut about 20 journalistsfrom the full-time newsroom staff of about 80. Further cuts came a few months later when Halifax turned around and sold the paper to New Media Investment Group, an affiliate of GateHouse Media, based in the suburbs of Rochester, New York.
Hurlbrink, 38, had two stints with GateHouse — first as a copy editor at The MetroWest Daily News of Framingham and later at the Design House, run out of the Framingham plant, which handled design and some copyediting tasks for multiple GateHouse papers. In August 2014, GateHouse announced that the operation would be closed and moved to Austin, Texas.
Even with a shrunken Telegram & Gazette, Henderson and Hurlbrink find themselves in the midst of a highly competitive media environment. In addition to the T&G, Worcester is covered by MassLive.com, part of Advance Digital; GoLocalWorcester, which has sister sites in Providence, Rhode Island, and Portland, Oregon; and Worcester Magazine, whose parent company, Holden Landmark Corporation, is controlled by GateHouse Media chief executive Kirk Davis but is not part of GateHouse.
In the face of such competition, Henderson and Hurlbrink say their plan is to steer clear of breaking news and offer depth and analysis instead. “We’re never going to cover breaking news,” Henderson says. “Will we cover the opiate epidemic rather than three people who OD’d in the last 24 hours? Yeah, we’ll take a look at that. But we’ll devote the resources to do it and give people an insight that they didn’t have before.”
“I think there’s a niche,” says Timothy McGourthy, executive director of the Worcester Regional Research Bureau. “I think it provides kind of a thoughtful human-interest approach to Worcester. It’s a generally positive approach to the city. I think the challenge is going to be getting the word out in the marketplace.”
The Sun’s paywall — as well as that of the T&G — is based on technology provided by Clickshare, whose website touts the software as a “flexible system” that allows for different types of paid access, billing and payment processing, and various options for e-commerce. Bill Densmore, who founded Clickshare in the mid-1990s, believes that print and digital serve two different types of audiences — and that Henderson and Hurlbrink are smart to try to serve both.
“A lean-back experience once a week makes a lot of sense to me,” says Densmore, a research fellow at the Reynolds Journalism Institute. “It’s an experiment, really, and an important one, both for the existing industry and for people starting on the digital side and wondering where that leads. I think the marriage of print and digital makes a lot of sense, particularly if you’re not trying to put out a daily paper, which increasingly seems anachronistic to me and to people in the digital world.”
Starting and maintaining a community news site is a hard way to make a living, but the allure is undeniable. LION counts about 130 member sites, and of course there many more that are not LION members. New ones pop up regularly. Just this week, The Boston Globe reported on a project called The Spark, cofounded by a former photographer for the GateHouse-owned Enterprise of Brockton.
It’s the same allure that has kept Henderson and Hurlbrink going despite setbacks — including a $150,000 Kickstarter campaign that fell well short of the mark. So far, they say, they’ve invested $200,000 in money and time. Soon they hope to unveil the first in a line of ebooks. And they’ve got plans to launch online verticals in areas such as education and local sports. “I think there are places we can go where we can be effective,” says Hurlbrink.
If all goes according to plan, they foresee a staff of 20 full- and part-time journalists. The key, adds Henderson, is to fill a niche — and not worry about what the competition is doing.
“We’ve never said we’re here to take the T&G out,” says Henderson. “Other people have. We don’t agree with that. Our stated goal is to serve our audience, the city of Worcester, the best we can. And if we have an opportunity to grow our audience, all the better.”
A huge newspaper deal was announced late this afternoon. The parent company of GateHouse Media of Fairport, New York, which has been on the march since emerging from bankruptcy last year, is buying out Halifax Media Media Group of Daytona Beach, Florida. Locally, the acquisition greatly expands GateHouse’s footprint in the central part of the state: earlier this year Boston Globe owner John Henry sold the Telegram & Gazette of Worcester to Halifax.
Jim Romenesko has the memo from GateHouse chief executive Kirk Davis.
GateHouse now owns almost every significant newspaper property in Eastern Massachusetts (and beyond) other than the Globe and the Boston Herald. The Digital First papers, which include the Lowell Sun and the Fitchburg Enterprise & Sentinel, are for sale. Will GateHouse scoop them up? What about the CNHI papers, which include The Eagle-Tribune of North Andover and three other dailies in that region? How long can they hold out?
Even before its latest acquisition spree, GateHouse owned about 100 papers in Eastern Massachusetts — mostly weeklies, but also mid-size dailies such as the MetroWest Daily News of Framingham, The Enterprise of Brockton and The Patriot Ledger of Quincy. In the past year GateHouse has added the Cape Cod Times, The Standard-Times of New Bedford, The Providence Journal and — in a little-noticed move just last week — Foster’s Daily Democrat of Dover, New Hampshire, a small but legendary community daily.
GateHouse has a well-earned reputation for cutting staff and compensation, although that hardly makes it unique. The larger story is that its executives clearly believe it can be the last local-newspaper chain standing by centralizing every part of its operations that aren’t strictly tied to local news.
A considerable amount of copy editing is being moved to a facility in Austin, Texas. The ProJo has a nice new press, and no doubt it will soon be printing as many GateHouse papers as it can accommodate — possibly cutting into the Globe’s printing business. GateHouse also owns what Davis calls a “digital services agency” called Propel Marketing.
At a time when few business executives want to mess with the newspaper business, GateHouse has gone all in. How it will end is anyone’s guess. But GateHouse has been down this road before, and it ended in bankruptcy. If Kirk Davis and company have a better idea this time, we should soon find out.
More: “Copy editing” at daily newspapers traditionally refers to editing stories for grammar and style, writing headlines and laying out pages. I am told that the Austin facility’s mission is limited to page design, though some copy editors at the ProJo are losing their jobs.
The online news site GoLocalProv is taking a well-deserved victory lap now that it’s been announced that GateHouse Media will acquire The Providence Journal from A.H. Belo of Dallas for $46 million. GoLocalProv reported on June 13 that the sale was imminent. But there the matter stood until Tuesday, when we learned that the Journal had been sold to GateHouse’s parent, New Media Investment Group.
As I told Ted Nesi of WPRI.com, I think it’s a shame that some way couldn’t be found for the Journal to return to local ownership — a lost opportunity, just as it was when John Henry sold the Telegram & Gazette of Worcester to Halifax Media Group of Daytona Beach, Florida, earlier this year. There is no substitute for a newspaper that is fully invested in the community. I have no doubt that cuts will follow, just as they did when New Media/GateHouse last year purchased Rupert Murdoch’s Dow Jones community papers, including the Cape Cod Times and The Standard-Times of New Bedford.
Still, any incoming chain would make cuts, and I think the new, post-bankruptcy GateHouse, based in Fairport, New York, deserves a chance to prove it will be good steward of the Journal. Despite reductions at the Cape Cod and New Bedford papers, journalists there continue to do a good job of serving their communities. On the other hand, the more than 100 community papers GateHouse already owns in Eastern Massachusetts are strictly barebones operations.
In a full-page ad in today’s Journal aimed at reassuring his new employees, customers and the community of the company’s good intentions, GateHouse chief executive officer Kirk Davis concludes:
We know The Providence Journal plays an indispensable role in helping you live your life in and around Rhode Island. We look to uphold these great traditions and make the investments needed to thrive in the new multimedia world. The purchase is expected to close later this summer. We are looking forward to welcoming the readers, advertisers and employees of The Providence Journal to our family.
At $46 million, New Media/GateHouse paid a surprisingly high price for the Journal. Although Belo is keeping the pension liabilities, it’s also keeping the downtown property. By way of comparison, John Henry paid $70 million for the Globe, the Telegram & Gazette and all associated properties — then turned around and sold the T&G for $17.5 million, according to a source involved in the sale. One possible explanation is that the New York Times Co. sold the Globe and the T&G to the low bidder, as one of the spurned suitors, “Papa Doug” Manchester, complained at the time. New Media/GateHouse, by contrast, was presumably the high bidder for the Journal.
Another possible explanation is that the Journal is worth more to GateHouse than to other buyers because it gives the company new territory for its Propel Marketing subsidiary. According to a perceptive analysis of the deal by Jon Chesto in the Boston Business Journal, Propel is seen by GateHouse executives as “the primary engine for growth at the company.”
Yet another wrinkle: The Globe has developed a nice side business printing other newspapers, including the Boston Herald and GateHouse properties such as The Patriot Ledger of Quincy and The Enterprise of Brockton. At a time when Henry is getting ready to sell the Globe’s Dorchester plant and move printing operations to a former T&G facility in Millbury, the prospect of losing GateHouse’s business has got to be disconcerting.
Rick Daniels will step down as president of GateHouse Media New England at the end of the year. GateHouse publishes about 100 community newspapers in Eastern Massachusetts — mostly weeklies, but also a few medium-size dailies, including the MetroWest Daily News of Framingham, the Patriot Ledger of Quincy and the Enterprise of Brockton. The company also runs about 150 Wicked Local websites.
In my rather minimal dealings with him, Daniels, a former Boston Globe executive, struck me as amiable and wanting to do right by local journalism. The same is true of Kirk Davis, president and CEO COO of all GateHouse properties, who will take over Daniels’ responsibilities on an interim basis.
But for years now, GateHouse — which runs more than 400 publications and websites from its national headquarters in suburban Rochester, N.Y. — has been staggering under the burden of $1.2 billion in debt. In August 2011, the Rochester Business Journal reported that GateHouse was “the most highly leveraged of any publicly traded newspaper company,” with debt nearly 14 times cash flow.
Thus in recent years we’ve seen a number of high-profile executives lopped off the payroll, including digital-publishing chief Howard Owens, now the publisher and editor of The Batavian, a widely admired local news site that he actually started for GateHouse, and Greg Reibman, former publisher of GateHouse’s Greater Boston papers, now president of the Newton Needham Chamber of Commerce. Also leaving was Kat Powers, managing editor of GateHouse Media New England, now director of communications for the American Red Cross of Eastern Massachusetts.*
Daniels is supposedly leaving GateHouse to pursue unspecified “investment and advisory roles for media companies.” At least no one is claiming that he wants to spend more time with his family.
“There’s a lot of pretty interesting deals that are out there and I’ve been approached by some folks who would like to do some of those deals,” Daniels told the Patriot Ledger. “They seem to have some interest in having operators with some experience.”
My guess is that if Daniels is quickly replaced, then his leave-taking was voluntary. And if Davis is still interim president six months from now, then Daniels’ departure should be seen as a cost-cutting move.
Five years ago I wrote about GateHouse’s debt woes for CommonWealth and talked pretty extensively with Davis. It’s been a long time, but the issues haven’t changed all that much.
Here is Davis’ email to the troops, a copy of which was forwarded to Media Nation by a trusted source earlier this afternoon:
I’m writing to explain some important news that is “public” today.
Rick Daniels, who has presided over our Massachusetts operations for the past 5 1/2 years, will be leaving his post at the end of the year. Rick plans to pursue investment and advisory roles to a variety of media companies.
I’ve had the pleasure of working with Rick throughout his career at GateHouse Media. He’s proven himself to be a very capable and accomplished executive, one who has led an accelerated transformation of our newspapers and web sites through very difficult economic times. Rick departs with our deepest gratitude and admiration and has graciously agreed to continue to provide any assistance I may need in order to ensure a seamless transition.
I will assume responsibility for our Massachusetts group on an interim basis. I’ve been affiliated with our operations in Massachusetts for many years and have always appreciated the support I’ve received from employees. I’ll enjoy reconnecting with staff.
In light of Rick’s departure, I will appoint a few key executives to assist me and our strong management team in Massachusetts through this transitional period. Look for that announcement before January 1.
Again, it has been a pleasure working with Rick. We are extremely grateful for his leadership the past 5 1/2 years and wish him much continued success.
*Correction: Kat Powers did not lose her job at GateHouse, as I originally wrote. Rather, she left the company to take a position with the Red Cross.
Following the most recent round of layoffs at GateHouse Media, one newly unemployed journalist decided he’d had enough. James Craven, who worked for GateHouse’s Norwich Bulletin in Connecticut, wrote a blog post headlined “Goodbye Norwich” in which he ripped into GateHouse management for deciding “to cannibalize the newspaper.”
Among other things, Craven writes that it’s his understanding the Bulletin is profitable, yet GateHouse laid off seven members of the newsroom staff. He continues:
[T]he most recently ordered layoffs will sap The Bulletin of nearly 20 percent of its newsroom staff. That will, of course, allow the president of Gatehouse Media to follow up on his $750,000 bonus to himself with an equally staggering and incongruous gratuity this year. Merry Christmas Mr. President.
Craven is referring to GateHouse chief executive Michael Reed, who did indeed receive a bonus of $750,000 last year. GateHouse president Kirk Davis got “only” $275,000. One other mistake: Craven prematurely offs Philip Meyer, who can now invoke Mark Twain.
Craven also writes:
The thing about reduced community coverage is that you do not notice it while it is happening. It is, if I may be so bold, like a cancer. It works below the surface, until one day when suddenly it becomes all too apparent. There will be referendums that may not be covered as fully. Some school functions — that first grade play that in the past featured your son or daughter — will be bypassed. On holidays, like Veterans Day, decisions will be made to forfeit coverage in some communities because there just is not an extra reporter.
Craven has written a rant for the ages. And he raises an important point. We all know that the newspaper business (like most businesses) is struggling. What is less well-known is that many of these papers are making money, but are being ravaged by their corporate owners, which are staggering under the debt they took on to build their empires and whose executives remain addicted to paying themselves bonuses.
Craven comes across as a journalist who really cares, and I wish him well. I have no idea if he could make a go of it financially. But how great would it be if he started a Norwich community news site to compete with the Bulletin?
Seems like it’s been ages since I last wrote about GateHouse Media, the financially challenged Fairport, N.Y.-based company that owns about 100 community newspapers in Eastern Massachusetts.
Things may be more quiet than they were a year ago, but rumblings of dissension persist. Several anonymous employees sent this along, detailing some mighty nice bonuses top GateHouse officials paid themselves to publish understaffed newspapers run by overworked, low-paid journalists.
Leading the parade is chief executive Michael Reed, who got $500,000. Taking the silver, with $250,000, was president and chief operating officer Kirk Davis, a top GateHouse official in Massachusetts before decamping for upstate New York last year.
It’s an old story. Ordinary people work hard for short money while the folks at the top reward themselves. Reed and Davis are managing a difficult situation, and it may well be that they deserve to be compensated handsomely just for keeping GateHouse alive. Then, too, their situation is hardly unique.
Just a few days ago we learned that Joseph Lodovic IV, president of Dean Singleton’s MediaNews chain, was receiving a $500,000 bonus for the bang-up job he did putting together a structured-bankruptcy plan. That may be the way of the world. But such tidbits can be pretty hard to swallow for those who actually cover late-night meetings and give up their weekends to photograph local events.
In other GateHouse news, here is a weird story involving a reporter for the company’s Dodge City Daily Globe, in Kansas, who was fired in the midst of a legal dispute over whether she should testify about her confidential source in a murder case.
Randy Turner looks at GateHouse Media’s latest filings with the Securities and Exchange Commission and discovers that Kirk Davis, the just-promoted president and chief operating officer, will be extremely well paid.
According to a Form 8-K filed with the SEC last week, Davis is now earning “a base salary of $461,260.80.” He’s eligible for performance bonuses as well, which sounds a little like a baseball team that signs a free agent for $12 million and then includes an incentive clause for making the All-Star team. Why? Shouldn’t the All-Star team be a given for that kind of money? [Note: I should make it clear that I don’t know what Davis was making as head of GateHouse Media New England. It’s possible that this isn’t actually a raise.]
Turner writes that Davis is making more than double what his predecessor earned as GateHouse’s number-two executive, although considerably less than what’s paid to GateHouse chief executive Mike Reed — $925,000 in 2007 and $6.4 million the year before.
Turner, a journalist-turned-schoolteacher, is witheringly sarcastic in observing that the financially ailing GateHouse is paying its top executives so well at a time when it has eliminated contributions to its employees’ 401(k) plans.
I think Davis is fundamentally a good guy, and that GateHouse can only benefit from having him run its day-to-day operations. But this is terrible symbolism.
It looks like GateHouse Media has done something pretty smart: the community newspaper chain has named Kirk Davis (right) as its president and chief operating officer, the number-two position in the company. Davis, who currently runs GateHouse Media New England, will be replaced by his own number-two, Rick Daniels, a former top executive at the Boston Globe.
GateHouse owns some 400 newspapers nationwide, and more than 100 in Eastern Massachusetts. The company is currently involved in a nasty legal dispute with the New York Times Co. over GateHouse’s and the Globe’s competing online strategies.
I’ve interviewed Davis several times over the years, including, most recently, this past fall for a piece I wrote for CommonWealth Magazine. He is smart, passionate and an inveterate optimist.
I’m not sure anyone is up to the task of saving GateHouse — or, for that matter, the newspaper industry in general. But Davis is not someone I’d bet against. (Thanks to Walter Brooks of Cape Cod Today for blasting out the press release.)
Photo of Davis is from a video on the GateHouse New England Web site, which you can see here.