Gannett’s latest earnings report led to several jarring stories about how much the nation’s largest newspaper publisher has deteriorated in recent years.
It’s tragic for communities where Gannett closed papers or cut newsrooms to the point where there’s little local coverage, and for thousands of journalists who lost jobs.
Those concerned about saving local journalism should note another revelation in Gannett’s report, one suggesting that there’s an opportunity for communities to restore their local newspaper.
During its Feb. 23 earnings call, CEO Michael Reed said the company is open to selling off local papers, if buyers step forward with a reasonable offer.
“We would entertain bids on any of our markets, any of our products that are at or above fair market value. So that’s something we’ve done in the past, we’ll do in the future,” Reed said, according to a transcript at Seeking Alpha.
Reed was responding to a question from an investor looking to “accelerate our debt repayment and surface some hidden value.” Ugh.
Gannett started the march toward corporatization and consolidation in the newspaper industry when it went public in 1967.
As Nieman Lab’s Joshua Benton wrote last week, Gannett’s 2019 mega-merger with another major publisher, Gatehouse, further burdened the company with debt and led to severe cost-cutting. The number of U.S. employees at the combined companies fell from roughly 24,388 to 11,200 at the end of 2022, he wrote.
Gannett also closed or sold dozens of dailies and more than 100 weeklies since the merger. Some communities abandoned by Gannett saw local news ventures launched, or regional publishers acquire spun-off papers.
Reed’s comments suggest there are many more opportunities to salvage and rebuild Gannett cast-offs.
Maybe I’m overly optimistic about these papers’ potential and the number of communities that could find investors, syndicates or even charitable organizations to give them a fresh start.
But I believe there’s still a demand and need for these local papers, if they restored coverage and proved their value. Reed said they’re still important advertising partners to local businesses.
“And especially on the local side, our local businesses continue to engage with us, and we see some slightly improving trends there in the first quarter,” he told investors during the earnings report.
This might be of interest to major philanthropists who are being asked to help address the local journalism crisis. Would their dollars go farther trying to reinvent the wheel, or helping local communities acquire and restore these fixer-uppers?
Policymakers, especially in Congress, should also think about these rebuilding opportunities in their states as they consider another pass at bills to sustain local journalism.
The two primary bills would do more than save existing news outlets. They would also help local owners acquiring former Gannett papers get started, stabilized and financed.
One, the Local Journalism Sustainability Act, would provide temporary tax credits for newsroom jobs created or sustained and credits for Main Street businesses advertising locally. The other, the Journalism Competition and Preservation Act, would provide sustained revenue by enabling local publishers to collectively bargain content deals with tech platforms.
Despite the changeover in Congress, there still appears to be bipartisan support for sustaining local journalism, according to Dean Ridings, CEO of the America’s Newspapers trade group.
Ridings and a group of local newspaper executives met with House and Senate members last week in the group’s annual “fly in.”
“I do think there is an increasing awareness on both sides of the aisle of the need,” Ridings said afterward. “When legislators see newspapers close in their district it hurts them, they are certainly aware of that.”
New versions of the bills could surface this spring.
Facebook’s Twitter challenge: Facebook parent Meta is reportedly developing a Twitter-ish social network that will enabling users to post text updates. More competition in this space is good but Facebook is problematic.
If this becomes a strong Twitter alternative, it will also be a test for the press. Will news outlets learn from painful lessons over the last decade, as platforms exploited outlets’ fear of missing out, made billions off their content and went ballistic when asked to pay? Perhaps this is an opportunity for news outlets to try securing fair compensation first, before seeding Meta’s new service with their trusted content.
This is excerpted from the free, weekly Voices for a Free Press newsletter. Sign up to receive it at the Save the Free Press website, st.news/SavetheFreePress.
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