Gheorghe Explains: The Desertification of American News

Our man in the Outer Banks is dropping science this morning, and he ain't all that happy about it. Dave Fairbank laments the decline of the small-town news, a phenomenon that means "...residents in communities, hundreds of communities, even thousands, in this country have limited, very limited access to the sort of news and information that's been the lifeblood of our democracy, everything from when and where to vote, to topics such as education, health, emergency and safety information that we need," according to  University of North Carolina professor Penny Abernathy. Your assignment, cub reporters and G:TB readers, is to read this paean to what was and should be and come up with solutions in the comments. Crowdsourced community soul restoration, what we do best around here.

It’s no secret that the news business isn’t awash in good fortune these days. Journalists are routinely harassed, jailed and even killed by authoritarian regimes. Newspapers all over the country are hemorrhaging readers, advertising and staff. Meanwhile, our oaf-in-chief continually uses the media as a punching bag and prop at his rallies, making it increasingly perilous to simply gather and present information.

On a personal level, my old shop appears to have invited the vultures through the front door, which worries me greatly about friends and former colleagues. No telling how it will play out, but recent history is not encouraging.

The hedge fund Alden Global Capital recently bought into Tribune Publishing, becoming the
company’s largest shareholder at 25.2 percent. Tribune Publishing oversees some sizable, respected papers, among them the Chicago Tribune, New York Daily News, Baltimore Sun, Orlando Sentinel, and Hartford Courant. The company also owns small-to-mid size papers such as the Newport News (Va.) Daily Press, where I spent 30 years, and recent acquisition the Norfolk Virginian-Pilot.

Alden already controls dozens of newspapers and is the largest shareholder (50.1 percent) in a company called Digital First Media, whose stable of papers includes the Denver Post, the St. Paul (Minn.) Pioneer-Press and San Jose Mercury News. Alden’s stewardship has been disastrous for most of its newspaper properties. For example, when it bought into DFM in 2012 through 2017, staff at the St. Paul paper shrank from 259 to 109, in San Jose from 158 to 92, and in Denver’s newsroom from 184 to 85. In several small-to-medium DFM papers in Pennsylvania, New Jersey and Michigan, staff was cut by more than 70 percent during that five-year span. Cuts in Denver sparked an open revolt, with the paper printing a handful of critical op-ed pieces and demanding that Alden sell to local interests. The outcry generated national attention, but in the end Alden made more cuts, citing the need to meet specific profit margins.

Alden is by no means the only outfit engaging in such practices, but is among the most egregious. Media consolidation has been going on for quite a while, as companies such as Tribune, GateHouse, Gannett, McClatchy and Media General attempt to make money, or at least stem losses, in a business world gone digital. According to the Boston Globe, 65 percent of newspaper jobs were lost between 1990 and 2016, a greater decline than coal mining and iron and steel mill work. Newspapers shuttered in the past decade include Denver’s Rocky Mountain News, Tucson Citizen, Tampa Tribune, Cincinnati Post and Pittsburgh Tribune-Review. More than 1,400 towns and cities across the country have lost newspapers in the past 15 years, according to data compiled by the University of North Carolina, expanding what observers call news “desertification” – areas not served by daily journalists.

Hedge funds don’t buy into newspapers because of some streak of civic responsibility, but because they see an opportunity to make a bunch of money relatively quickly. Newspapers represent a “distressed” business and therefore provide a relatively cheap buy-in, whether it be from market forces or current ownership looking for an escape hatch and sizable payout on their way out the door. If a newspaper or chain can gain financial traction, fine, and the hedge fund can profit from that. If it continues to flounder, the hedge fund often cuts expenses – usually in the form of workers – and extracts as much profit as possible before dumping and moving on.

Newspapers used to be family owned, and corporate and classified ad revenue made those families tidy sums. It wasn’t unusual for newspapers to have profit margins of 15-20 percent, or higher. Those profits turned newspapers into investments, and gradually they were run by business people, not newspaper people. When the Internet started siphoning off advertising, profit margins dropped. In response, bosses did what’s done at other businesses – cut expenses. But you can only depreciate office furniture, computers and cameras so much. The big expense is people, often reporters and editors.

I’ve argued for years that newspapers aren’t like other businesses. They’re more like public trusts than for-profit endeavors. Cut staff at many businesses and there may be alternative paths to success – technology, automation, retrenching. Cut staff at a newspaper, however, and stuff goes uncovered. Local government, cops and courts, business deals, construction and infrastructure contracts, never mind sports and entertainment and personalities. Nobody’s watching. Nobody has time. I endured a fair share of layoffs, early buyouts and staff cuts, along with the accompanying meetings and memos in which the message was “do more with less” and “work smarter, not harder.” I’m here to tell you that where news gathering is concerned, it’s damn near impossible to build greater efficiency into the process. No one does more with less, you only do less with less.

Major metropolitan areas are better equipped to deal with the shrinking newspaper field. There are generally more outlets for news, and a greater probability of a segment of engaged citizenry. But it’s the small and medium-sized towns and cities that suffer most when newspapers shrink or die. The local paper is often the only outlet for news, the sole watchdog on abuse and injustice and a community’s shared experience.

I have no idea how Alden’s tenure will affect my friends and former co-workers in Newport News and Norfolk. I would like to think that they’re far enough down the food chain to grant them some reprieve from the butcher’s knife. Both shops have been through several rounds of cuts and layoffs through the years, so little fat remains. But given the bloodless chase for profits and satisfied investors, nothing would surprise me.