GateHouse officials: Quincy bid was not a conflict of interest

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:

DATE: 04/15/16

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:

  1. Amplify Quincy’s story: Develop and implement a marketing campaign that projects Quincy’s image in print, broadcast, digital and social media
  2. Cultivate Positive Media: Leverage and develop relationships that result in positive media about Quincy development opportunities and current hospitality opportunities
  3. 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.

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GateHouse creates a dilemma for its Quincy journalists

Quincy City Hall. Photo via Wikipedia.
Quincy City Hall. Photo via Wikipedia.

At CommonWealth Magazine, Jack Sullivan offers a good overview of a massive conflict of interest in Quincy, where GateHouse Media’s marketing subsidiary is bidding for a city contract in the shadow of GateHouse’s Patriot Ledger, headquartered in Quincy.

The GateHouse subsidiary, Propel Marketing, has already done work for Quincy Mayor Thomas Koch.

We’ve already been talking about this at Facebook, so feel free to chime in.

My insta-analysis is that newspaper owners always create conflicts of interest. Washington Post reporters have to cover Amazon, whose founder and chief executive is the Post‘s owner, Jeff Bezos. To extend that a little further, Amazon does business with the CIA, a major beat for the Post. The Boston Globe, owned by John Henry, covers the Red Sox, and Henry is the principal owner. And newspaper publishers have always held roles in the community that journalists shouldn’t, such as chairing the local chamber of commerce.

What matters is whether those conflicts are handled in a way that’s transparent, ethical, and arm’s-length. Given GateHouse’s recent misadventures involving casino mogul Sheldon Adelson and the Las Vegas Review-Journal, I’d say the Quincy situation needs to be watched very closely.

Jay Rosen has been indispensable in understanding the Las Vegas mess. Here’s what I wrote for WGBHNews.org about how one independent Connecticut journalist exposed part of the story. And here’s how the Patriot Ledger itself covered the Quincy story recently. It’s thorough in just the way you’d want it to be, so kudos.

Correction: In the first version of this post I wrote that the Patriot Ledger‘s headquarters are in Braintree. In fact, the Ledger is located in an office park on the Quincy side of the Quincy-Braintree line.

Northeastern j-school faculty calls for public-records reform

The state’s weak public-records law has long needed to be reformed. A lack of meaningful penalties for government agencies that refuse to turn over public records, outrageous fees and other problems make Massachusetts a laggard when it comes to transparency. Several years ago the State Integrity Investigation awarded Massachusetts a richly deserved “F” on public access to information.

Last week brought mind-boggling news from Todd Wallack of The Boston Globe, who reported that Secretary of State William Galvin’s office has issued rulings allowing certain formerly public records to be suppressed, including arrest reports of police officers charged with drunken driving. (Galvin later turned around and called for an initiative petition to put some teeth in the public-records law. Make of that what you will.)

Now the Globe, the Boston Herald and GateHouse Media Massachusetts have editorialized in favor of significant reform. The Massachusetts Freedom of Information Alliance, a group comprising the New England First Amendment Coalition, the ACLU of Massachusetts, the Massachusetts Newspaper Publishers Association and others, is calling for immediate action.

Seventeen of my colleagues and I at Northeastern’s School of Journalism lent our voices to the cause this week with a letter that has been published in the Globe, the Herald and (so far) two GateHouse papers: The Patriot Ledger of Quincy and The Herald News of Fall River. Because the Globe and the Herald were unable to run everyone’s names, I am posting them here. They include full-time as well as adjunct faculty:

  • Dan Kennedy, interim director
  • Chris Amico
  • Mike Beaudet
  • Nicholas Daniloff (emeritus)
  • Charles Fountain
  • Carlene Hempel
  • Joy Horowitz
  • Jeff Howe
  • William Kirtz
  • Dina Kraft
  • Jean McMillan Lang
  • Laurel Leff
  • Gladys McKie
  • Lincoln McKie
  • Bill Mitchell
  • Tinker Ready
  • James Ross
  • Alan Schroeder

This is Sunshine Week, an annual celebration of open government. In Massachusetts it’s time to let the sun shine in.

GateHouse parent buys T&G — and its parent chain

Screen Shot 2014-11-20 at 5.26.17 PMA 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.

Big moves as Globe prepares to expand its business section

Some big media moves were announced a little while ago as The Boston Globe plans to ramp up its business section next month. First the email sent to the staff by editor Brian McGrory and business editor Mark Pothier. Then a bit of analysis.

Hey all,

We’d like to fill you in on some terrific developments in our Business department, all of them designed to build on the exceptional work that went into our Market Basket coverage and so many other news and enterprise stories over the past year.

First, we’re reconfiguring the paper to give Business its own section front on Tuesdays through Fridays, starting the first week of December. In fact, Business will get a free-standing eight-page section, somewhere between Metro and Sports. We’ve worked with Mark Morrow and Dan Zedek, as well as an entire team of creative editors and reporters, to conceive a bold new approach to business coverage, both in form and function. There’ll be a more contemporary look, a plethora of new features, and a renewed commitment to the most insightful and energetic business coverage in New England. We’ve got everything but a new name, which is currently, to my chagrin, “Business.” Please offer better ideas.

For this new section, we need additional talent, and that’s the best part of this note. We’ve locked in three major moves and we’re working on still others. To wit:

— Cynthia Needham, the Globe’s invaluable political editor for the past four years, the person who has taken us deftly from Brown v Warren to Baker v Coakley, and through so much in between, is heading to Business to help oversee a talented team of reporters and key parts of the new section. There’s not a better person in the industry to help the cause. Cynthia was a vital part of the conception and launch of Capital, our wonderfully popular Friday political section. She knows inherently that journalistic sweetspot where insight meets accessibility. And she is among the smartest, hardest-working, and best-connected editors in the building, all of which is why we asked her to undertake this crucial assignment. Cynthia will start at her new post, as one of Mark’s deputies, next week.

— Jon Chesto, the managing editor of the Boston Business Journal, is coming to the Globe November 24, as a reporter covering what we’ll describe as a “power beat.” It’s a great get for us. Jon’s among the absolute best connected reporters in the city, with a deep knowledge of how commerce works and the major figures who shape it. He’s also an energetic workhorse, an irrepressible reporter who will help breathe fresh energy into the department with smart stories. Before his stint at the BBJ, Jon spent a big chunk of time as the business editor at the Patriot Ledger, where he won a string of national awards for his weekly column, “Mass. Market.”

— Sacha Pfeiffer will arrive back home to the Globe the first week of December. There’s no way to overstate the significance of this. Sacha is legend here, which has nothing to do with Rachel McAdams, but everything to do with her exceptional reporting over a decade-long stint at the Globe, during which she shared in the Pulitzer Prize for the Spotlight series on clergy child abuse and a litany of national honors for other stories. She’s been a star at WBUR since 2008, recognizable for her expert reporting and authoritative on-air presence. The exact particulars of Sacha’s beat are still being worked out, but it will focus on wealth management and power, along with a weekly column tailored to the huge and vital nonprofit world in greater Boston. Sacha, like Jon, will report to Cynthia.

We’re aiming to make our business coverage a signature part of the Globe, both in print and online, which shouldn’t be hard, given that we’re starting from a very strong position. Our reporters have attacked their beats with gusto. Shirley [Leung] has proven to be a must-read columnist every time she taps on her keyboard. Our editors have poured creativity into the job, and it shows.

The reimagined section will launch December 4, give or take a day. We have mock-ups we’ll share with the whole staff early next week. In the meantime, please take a moment to congratulate Cynthia and to welcome Jon and Sacha to the Globe.

All best,
Brian and Mark

Now, then. This is great news for Globe readers, although I would express the hope that expanded labor coverage will be part of this as well. But for those of us who watch the comings and goings of local media people, the most surprising development is Sacha Pfeiffer’s return to the Globe.

When Pfeiffer joined WBUR (90.9 FM) several years ago, I thought it solidified ’BUR as the city’s most interesting and creative news organization. Of course, ’BUR remains one of the crown jewels of the public radio system. But Pfeiffer’s return underscores the extent to which the Globe is expanding these days under owner John Henry and editor McGrory. (Disclosure: I’m a paid contributor to WGBH, whose news-and-talk radio station, at 89.7 FM, is a direct competitor of WBUR’s.)

Chesto’s move is less surprising because it’s a step up. But the Boston Business Journal has been set back on its heels given that executive editor George Donnelly left at the end of last month.

Sale of ProJo a lost opportunity for local ownership

Previously published at WGBHNews.org.

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.

Michael Calderone on what to expect from Carolyn Ryan

One of the first media pieces I ever wrote for The Boston Phoenix, in the mid-1990s, was on the shrinking Statehouse press corps. Among those I interviewed was a young reporter for The Patriot Ledger of Quincy named Carolyn Ryan.

Ryan went on to great success at the Boston Herald, The Boston Globe and The New York Times. She was recently named the Times’ Washington bureau chief, and Michael Calderone of The Huffington Post has written about what to expect. An excerpt:

Ryan … has managed large reporting staffs in New York and Boston and is known inside the paper as a fierce competitor who sets high expectations. Such attributes can benefit the the Times’ Washington operation, which appears to be stepping up efforts against Politico and others in driving the political conversation of the day. Ryan may help ward off the complacency that news outlets long at the top of the media pecking order can sometimes fall prey to.

Quite a rise for Ryan, a hard-working, talented journalist. She deserves this moment, and I have no doubt she’ll make the most of it.

BBJ scores big on two local media stories

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.

GateHouse papers ban anonymous comments

Anonymous commenter reacts to new GateHouse policy
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.

Here’s how the reason for the new policy was explained in the GateHouse-owned Patriot Ledger of Quincy earlier this week:

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.

In other words: better some places than others.

Cohasset selectmen back off

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.