Remember when there were 14 publicly traded, independent or family-owned news companies, a number run by journalists? I do. This is what I encountered at my first media investor conference in New York in December 2001.
A short walk down memory lane appears to be in order this week, as two of the remaining state-owned companies – with 40 metropolitan and regional dailies between them – could effectively come under the control of private hedge funds as early as Wednesday.
As I wrote recently on Wednesday, Alden Global Capital, released from a standstill agreement, can increase its stake by one-third and acquire a controlling stake in Tribune Publishing. July 1 is also the date on which offers must be filed in federal bankruptcy court for McClatchy. Chatham Asset Management owns most of the company’s secured debt and therefore has the option of owning it.
These scenarios are likely to unfold over weeks or even months, but if realized, only four public news companies will remain: the financially strong New York Times Company, as well as Gannett, Lee Enterprises and AH Belo. , the latter three having stock market transactions at a lower cost. only $ 2.
18 and a half years ago, the Plaza Hotel’s lineup (also thriving at the time) made up a substantial majority of the industry, measured either by revenue or traffic. The shares were doing well. Many companies had strong local broadcast divisions. With the exception of the onset of murderous competition from online classifieds services like Monster and Craigslist, digital was not a factor.
Here are the companies, along with a brief overview of each past and present:
The New York Times Company: The president was Arthur Sulzberger Jr., enthusiastic about the newspaper’s coverage of 9/11 and its aftermath. The Times Co. owned the Boston Globe (later sold to John Henry) and a group of regional newspapers, primarily in the South, which then went through several owners and are now part of Gannett.
Dow Jones & Company: It consisted of The Wall Street Journal and a financial information services group. The CEO was former journalist and editor Peter Kann. The Bancroft family, whose family voting share class gave them control, sold the company to Rupert Murdoch’s News Corp for $ 5 billion in 2007.
The Washington Post: Don Graham, trained since his teens to take over the family business, including as a journalist and editor, was the CEO. The company had small but highly profitable local broadcast and cable divisions, and included the growing education business Kaplan. Graham and his niece, Katharine Weymouth, Post editor, decided to sell the Post to Amazon founder Jeff Bezos in 2013, believing that he was better placed than them to invest in digital transformation.
Gannet : At the time, as today, it was she who owned the most newspapers. Al Neuharth, who founded USA Today and made Gannett the nation’s largest newspaper company, was still an influence but had passed the mantle of CEO to its chief financial officer, Doug McCorkindale. Gannett’s TV division, later derived as Tegna, became the largest part of the business.
Tribune editions: It was a juggernaut after its purchase the previous year of The Times Mirror Company – the Los Angeles Times and related broadcast properties – for $ 8.3 billion. Jack Fuller, the former editor of the Chicago Tribune, was the CEO of its publishing arm. The CEO was CFO John Madigan, who was replaced in a few years by TV director Dennis FitzSimons. A majority stake in the company was then sold to real estate investor Sam Zell and then Chicago entrepreneur Michael Ferro.
Knight Rider: Neither the Knights of the same name nor the Ridders had control of the company’s votes, although family member Tony Ridder later became CEO. As with Tribune and Gannett, there was only one type of shares – all shares had equal voting rights. Knight Ridder was one of the first companies to encounter friction with its publishers over downsizing. Three investment groups have racked up more than a third of the company’s shares and pushed for a sell-off. The company was sold to McClatchy in 2006.
The EW Scripps Company: It was another family business that started out in newspapers and then branched out into television. Alone within the group, he had developed a successful cable production business, launching the Food Network and several other lifestyle channels. These and the local broadcast division were ultimately separated. The rest of the company was sold to Gannett in 2015.
The McClatchy Company: She only owned newspapers and was the largest of a group of small businesses. She had ambitions to grow from her Californian roots and had acquired papers in Raleigh, North Carolina and Minneapolis before embarking on the purchase of the larger Knight Ridder property in 2006. The debt of this transaction has been a drag for over a decade. The company filed for a bankruptcy reorganization earlier this year, giving up 163 years of family control.
General information on the media: It was a collection of news and broadcast properties based in Richmond, Virginia. Almost all of the newspapers were sold to Warren Buffett’s BH Media in 2012. After Buffett lost faith in the newspapers’ prospects, BH Media in turn was sold to Lee Enterprises in early 2020.
Lee Companies: This is a collection of smaller newspapers, based in Davenport, Iowa, known for its competent business organization. A survivor. Most of the newspapers are in the Midwest or West.
Pulitzer, Inc .: It was controlled by the family for which the awards are nominated. Besides the St. Louis Post-Dispatch, the company’s only other major holding was the Arizona Daily Star of Tucson. The company was sold to Lee in 2005.
AH Belo Corporation: He owns The Dallas Morning News and once had a strong television and newspaper division in Providence, Rhode Island and Riverside, California. It was controlled by the heirs of the founder AH Belo. Everything except the Morning News has been derivative or sold.
Journal communications: Later known as Journal Media Group, its TV portfolio grew and quickly overtook its only subway newspaper, the Milwaukee Journal Sentinel. The Sentinel Journal was sold to Scripps, who sold their journals soon after to Gannett.
Journal register: Another collection of small groups of newspapers, it was a forerunner of Alden’s MediaNews Group channel and proudly a tight-fisted even then. The CEO once bragged to Forbes about the practice of checking reporters’ odometers to make sure they didn’t inflate expenses.
As this brief history suggests, many companies split in two when their growing and highly profitable broadcasting stakes were reduced in market value by stagnant newspaper divisions.
A few diversified private media companies – Hearst and Advance Local come to mind – continue to maintain significant divisions in newspapers and digital. But others, like the Morris or Cox chains, have either disappeared or been downsized.
Last week, a detailed update on Penny Abernathy’s work at the University of North Carolina at Chapel Hill, detailing the disappearance of 2,100 newspapers so far since 2004, most of them weeklies. At the same time, “information deserts” and “ghost newspapers” have proliferated.
This is an important dimension of the financial crisis in the local news. Maybe my metropolitan roots are visible, but I’m just as alarmed when the big and medium everyday become “a shadow of themselves” as the saying goes.
The Chicago Tribune, Miami Herald, and the 38 others are unlikely to be downsized overnight even more than they have been.
It will be another sad tipping point, however, if they come to the tender mercy of hedge fund owners.
Rick Edmonds is Poynter’s media business analyst. He can be contacted at [email protected]
This article has been updated to clarify the recent history of Tribune Publishing and Knight Ridder.