Updates and Backgrounders
are the updates for the second edition beginning in July 2012.
update on Nov. 12, 2016
3: Update Alert. Lee Enterprises is the newspaper chain mentioned but left unnamed in the second paragraph as entering bankruptcy in December 2011 but expecting to resolve its case in sixty days. Lee actually managed to emerge from bankruptcy only a month later. One of the few newspaper companies not to be taken over by private investors after bankruptcy, Lee gave up only 13 percent of its shares to creditors as it refinanced about $1 billion in debt. The company's credibility was enhanced in August 2012 when Warren Buffet's Berkshire Hathaway nearly doubled its ownership of Lee shares from 1.7 million shares to 3.23 million shares. Even so, Lee's stock, which had been $45 in 2005, was at about $1.60 in 2012. It recovered to $4.85 in early 2014.
8: Update Alert. The Tribune Company of Chicago emerged from bankruptcy on Dec. 31, 2012, after four years in Chapter 11 proceedings. Tribune
Company had announced in May 2012 that it was making changes
in its corporate structure for the possible sale of its publishing
and broadcasting properties when it emerges from bankruptcy. Tribune
Company had filed for bankruptcy in December 2008. As predicted on this page, a July 2012 ruling allowed senior creditors to take over Tribune Co. For details on the bankruptcy, see this article. The
fate of its employees' ownership
stake through an ESOP is still at risk.
What's next for Tribune Company? Tribune Co. announced in July 2013 that it would spin off its broadcast and newspaper properties into separate companies called Tribune Media and Tribune Publishing, respectively. In March 2013 major contenders emerged for purchase of the Chicago Tribune, Los Angeles Times, and Baltimore Sun — including the right-wing Koch brothers, conservative Rupert Murdoch, and a liberal billionaire, Eli Broad. See this article.
9: Update Alert. The 2016 report for "The State of the News Media" is now available. It notes that the decline is still sharply downward for traditional news outlets such asnewspapers and loca TV, and it's mixed for network TV news.
11: Backgrounder. Edward R. Murrow's concern over the co-existence of capitalism and
journalism is explored in depth in a 2004 article by one of today's
great capitalists—CNN founder Ted Turner—in which Turner
concludes the pendulum has swung too far in favor of huge media
article, "My beef with big media: How government protects big
media—and shuts out upstarts like me," is in the July/August
issue of Washington Monthly and on the Web at <www.washingtonmonthly.com/features/2004/0407.turner.html>.
Turner's conclusion forcefully states, "At this late stage,
media companies have grown so large and powerful, and their dominance
has become so detrimental to the survival of small, emerging companies,
that there remains only one alternative: bust up the big conglomerates."
13: Update Alert. The FCC's review of media ownership rules, started in 2011, ended up again recommending that regulations prohibiting cross-ownership of TV and print companies be relaxed. However, on Feb. 26, 2013, it was decided to postpone a vote until the summer of 2013 so a nonprofit group could study the potential impact on women and racial minorities. The FCC proposal as written would relax regulations that prohibit a single company from owning a TV broadcast station and a newspaper in a single top market, but it would strengthen consolidation rules in smaller markets. The proposal would eliminate bans on newspaper-radio and TV-radio cross-ownership.
14: Update Alert. Since the chart was updated in mid-2011, the size of
some large media companies with holdings in newspapers and TV have grown or diminished. For
those wanting to keep the chart up to date, as of early 2013 these
are the updated changes: Gannett, 42 TV; Tribune Co., 8 dailies and 42 TV; MediaNews Group, 56 dailies; E.W. Scripps Co., 14 dailies and 17 TV; Community Newspaper Holdings Inc.,
77 dailies and 0 TV; Cox Enterprises, 8 dailies and 14 TV; Schurz Communications, 9 TV stations; and Media General, 1 daily and 31 TV; (see note for page 278).
The Project for Excellence in Journalism annually issues a study
on the state of the U.S. media. For the most current assessment
of the media, see journalism.org
Previous years' reports are: The State of the News Media 2015, which tells how mobile devices are driving digital traffic, not desktops. The State of the News Media 2014 includes a study of the years-long decline in local news reporting. The State of the News Media 2013 report studies how media companies are trying to cope with the erosion of resources. The
State of the News Media 2012 analyzed
how news consumers are switching to mobile devices such as e-readers
and tablet computers. An assessment of how all sectors
of the media except daily newspapers improved in 2011 is in The
State of the News Media 2011. Initiatives being attempted to make
online journalism profitable are reviewed in The
State of the News Media 2010. The crisis for newspaper and TV journalism
is examined in The State
of the News Media 2009. An analysis of news coverage for the year
is provided in The State
of the News Media 2008. A detailed study of online journalism
is in The State of
the News Media 2007. In the 2006 study, PEJ concluded that the war between news
and the bean counters was over, and that the bean counters won.
That study is on-line at The
State of the News Media 2006. In The
State of the News Media 2005, journalists who were surveyed
said that profit pressures are hurting news coverage worse than
ever. The State of the News Media 2004 studied cutbacks in the newsroom
to bolster profits.
to the "Historical Perspective of the Media" was the national
and global recession, which began in 2008, steadily intensifying
into 2009. It resulted in massive cost-cutting by media companies,
especially newspapers. A number of different cost-cutting measures
taken by newspapers trying to survive the recession are discussed
with links to full articles here.
The best site for keeping up with newspaper closures and other news about newspapers is newspaperdeathwatch.com.
38: Update Alert.
The latest update for salaries for new journalism graduates shows
changes from those posted in the book. In nominal terms, the bachelor's
degree recipients in 2013 received a median annual salary of $32,000,
unchanged from $32,000 in 2012. The annual survey by the Grady College at
the University of Georgia. In 2012, it reported
the following median salaries for 2012 graduates compared with 2011 (2009 and 2010 salaries are in the book):
Median salaries for 2013 graduates compared with 2012 graduates:
- online, $35,000 — unchanged from $35,000
TV, $32,500 — down from $35,000
relations, $35,000 — up from $33,000
$35,000 — up from $34,000
information, $31,800 — up from $30,000
magazines, $25,000 — down from $30,000
- dailies, $29,600 — up from $28,550
$30,000 — down from $31,300
TV, $29,000 — up from $28,000
$30,000 — up from $27,100
- educational institution, $31,600 — down from $33,000
- government agency, $37,000 — up from $36,000
Complete 2013 salary data is here,
with charts toward the bottom. The Grady College discontinued the annual surveys with the 2013 study.
57: Update Alert. In 2004, Denver billionaire Philip Anschutz bought the free daily newspaper, the San Francisco Examiner. He acquired a paid-circulation print newspaper in September 2011 when he bought The Oklahoman daily in Oklahoma City. He also owns a free print daily, the Washington (D.C.) Examiner. Two months after buying The Oklahoman, he sold the San Francisco Examiner to a Canadian publisher, Black Press Group.
57: Backgrounder on endnote 50 (on page 356).
has filed for trademark rights to the Examiner.com name in
about 70 cities, sending a signal of his hope to establish online
Examiner dailies based on "citizen journalism" reporting across the country. If there is an Examiner online news site in your city, it will automatically show up by
typing examiner.com into your browser. If not, you will be taken
to the Examiner's national site. A discussion of Anschutz's
strategy can be found in a 2012 American Journalism Review article.
65: Backgrounder. The Citizens'
Voice of Wilkes-Barre, Pa., is still published in competition
with a MediaNews daily there. And the Las Vegas Sun
is hanging onto life in a JOA with Nevada's largest daily, owned
by Stephens Media Group. (See Page 266's note on the Las Vegas JOA.)
67: A lawsuit was filed in 2011 on behalf of those 9,000 writers who submitted articles for publication for free on Huffington Post. The lawsuit contended that the work of unpaid content providers allowed Huffington Post co-founder Arianna Huffington to profit at their expense, and so they should receive some of the $315 million received when Huffington Post was sold to AOL. A judge dismissed the suit in March 2012, ruling that "no one forced" the writers to work for no pay, and that simply being published was the reward they had bargained for.
67-68: Backgrounder. While CNN is using citizen journalists in broadcast, citizen journalists make up the foundation of billionaire Philip Anchutz's online newspapers at examiner.com. (See the page 57 backgrounder.) A discussion of Anchutz's experiment in pure citizen journalism is in a TechCrunch article decrying examiner.com's amateur reporting and writing. Nevertheless, examiner.com is consistently in the list of the 100 most popular websites.
69: Along with the discussion of layoffs, I should also have included the related but more favorable category of "Buyouts" for reducing staff. Buyouts are ordinarily given only to high-ranking executives of a company. They often occur simultaneously with layoffs. With buyout, however, the executive is offered a severance package so generous that they "voluntarily leave" the company. Of course they might also be accepting the severance because they know if they don't accept a buyout then the buyout offer could turn into a layoff notice. Several buyouts of media executives have been conducted, many under the radar, with the most publicized being the early 2013 buyouts of several editors and senior reporters at the New York Times, including Managing editor John Geddes, assistant managing editor John Roberts, and deputy managing editor William E. Schmidt. A list of the January buyouts for the Times is here.
160: Update Alert. The textbook briefly discusses "Employment-at-Will," in which legal sanction is given "to the principle that an employee works only at the will of the employer and can be dismissed at any time, for any legal reason." (Emphasis added.) However, that final caveat is being reinforced by litigation in many employment-at-will states in addition to the book's example of someone being fired contrary to an adopted staff manual's procedures.
Albuquerque attorney Martin G. Marshall points out that courts are chipping away at the employers' right to arbitrarily fire someone under this employment doctrine in many states. This makes it more likely that a fired employee can bring an appeal to a jury, which is often more sympathetic to the emloyee than to the employer.
As an example, Marshall cites court cases in New Mexico, which is an employment-at-will state and typical of others. He said the doctrine "has been swallowed by exceptions such a public-policy, whistle-blower, and anti-discrimination laws. Also, the National Labor Relations Board has taken the position that a broad employment-at-will in employee contracts or handbooks might violate the National Labor Relations Act."
Marshall said the employer's situation is difficult. He recommends that a contract's at-will statement include a system of severance for "non-cause" terminations and a separate arbitration for "cause" firings.
161: Update Alert. In December 2012 Michigan became the 24th Right-to-Work state when its Republican-controlled House and Senate passed the bill and it was signed by the Republican governor. Wisconsin and Virginia then passed similar bills in 2015 and 2016.
162: Update Alert. Owners and managers are often tempted to take people who under the law are "employees" and classify them instead as "independent contractors" to save money on benefits and taxes. They should heed the January 2014 judgment against the San Diego Union-Tribune for $10 million to the newspaper's former carriers. The carriers had
sued on the grounds that Copley Press illegally classified them as independent contractors from 2005 to 2007. Attorneys for the paper said they will appeal.
174: Update Alert.
Conrad Black's downfall as CEO of Hollinger International stemmed from his violation of the "approved contradiction." As a result of the unprecedented stockholder
rebellion against him, on Dec. 10, 2007, Black was sentenced
to 6 1/2 years in prison for taking millions of dollars from Hollinger
without approval or disclosure to his board of
directors. He was released from prison in May 2012 after serving
42 months at Coleman prison in Florida on fraud and obstruction
of justice charges.
major U.S. daily, the Chicago Sun-Times, went into
Chapter 11 bankruptcy in March 2009 beleagured by more $608 million
in debt to the IRS. Sun-Times Media Holdings sold the Sun-Times in December 2011 to a new private investment group named Wrapports
LLC. For an inside look in 2013, see the article in Chicago Magazine.
185: Update Alert. A group of newspapers became the nation's first ESOP in 1956, although that term did not come into use until nearly two decades later. The two founders (both in their 80s) of Peninsula Newspapers in California wanted to avoid a chain's purchase and instead turn their newspapers over to their employees. But how could the employees ever come up with enough money to buy the papers? Read here how attorney Charles Kelso worked out the details making the first ESOP possible and how legislation has made formation of employee stock ownership plans much easier since. Ironically, newspapers today seldom transfer ownership through ESOPs, but employee stock ownership is becoming more common among many other companies.
Page 212. Update
Alert. For a compilation of some cost-saving
strategies being taken by media companies (other than layoffs, buy-outs
and wage freezes) in the 2008-09 recession, go to the Plato-inspired
-- Who Is The Mother of Invention.
Pages 230-1. Update
Alert. The Audit Bureau of Circulations (now known as the Alliance for Audited Media, or AAM) reported newspaper circulation was about the same in September 2012 as six months earlier — but with a big change. Print circulation is still falling, but paid digital has almost made up the difference, rising to 15.3 percent of the total from only 9.8 percent a year earlier. By September 2012, more than 300 newspapers had installed paywalls and were charging for digital subscriptions. The AAM reported the Top 25 newspapers by circulation updated as of March 31, 2013.
The AAM discontinued its Top 25 list in September 2013, but did report that USA Today is now the largest circulated daily at 2.877 million, topping what had been the perennial weekday champion The Wall Street Journal (2.274 million) and The New York Times (1.898 million). All three reported circulation gains from the previous year. The New York Times remains the top-circulated Sunday paper with 2.392 million copies, up from 2.101 million the previous year. AAM provided a snapshot of its September 2013 report.
Page 232. Update
Alert. Time is now the last national newsmagazine in print. Newsweek's last print issue was Dec. 31, 2012, and it is now entirely online. Founded in 1933, Newsweek had a circulation of more than 3.3 million in 1991. The Washington Post Co. sold it for $1 in 2010 and it had been teamed with the Daily Beast online site ever since. Read the New York Times analysis. In August 2013 Newsweek was sold to the International Business Times.
259-60: Update Alert.
AOL's purchase of Time Warner is reputed to be one of the
most disastrous mergers in business history. On Sept. 19, 2003,
the board of directors of AOL Time Warner voted to drop the letters
"AOL" from the corporate name after the Time Warner executives
wrested back control of the company following the dot-com collapse.
Finally, on Dec. 9, 2009, Time
Warner split off AOL as a separate publicly traded company in
a move announced the previous May.
Page 263: Tampa, Florida, lost one of its papers when the Tampa Bay Times purchased the Tampa Tribune and closed it on May 4, 2016. In addition, somehow the list of two-newspaper cities omitted Pittsburgh. Irrelevant now, because on Sept. 28, 2016, the Pittsburgh Tribune-Review stopped publication of its print paper and went wholly online, laying off 106 staffers. Until the purchase, the Tampa Bay-St. Petersburg metro area had three dailie. Charleston, W.Va., is no longer a JOA (see next entry).
266: Update Alert. There is now one less JOA because in 2015 the Charleston Gazette and the Charleston Daily Mail merged into one newspaper now named the Charleston Gazette-Mail. In addition, the table should show the York, Pa., JOA is owned by Gannett, which purchased it from MediaNews Group in mid-2015. Gannett now owns both newspapers in the York JOA. Some hisltory of the York JOA can be seen in a story. Also, with the 2015 sale of Stephens Media Group, the owners of the Las Vegas, Nev., JOA are now New Media/independent.
272: Update Alert. The owner of the Orange County (Calif.) Register and the Riverside Press Enterprise filed for Chapter 11 bankruptcy in November 2015 after their owners Aaron Kushner and Eric Spits over-expanded in print and were forced to close two new newspapers and do a round of staff lay-offs. CEO Richard Mirman said the company lost $40 million in its high-stakes venture to expand California newspapers. Kushner and Spitz had bought the Register and Press Enterprise after a couple of failed efforts to buy other newspapers from private investors headed by Alden Golden Capital in July 2012. Read an in-depth analysis from the Los Angeles Times. On April 1, 2016, the Register and Press Enterprise were purchased by Digital First Media for $49.8 million.
272: Update Alert. Journal Register Company, with newspapers in 10 states, was sold for $120 million in April 2013 to 21st CMH Acquisition Co., owned by the Alden Global Capital hedge fund. JRC declared its second bankruptcy in three years in September 2012. JRC had been owned since 2009 by Digital First Media, an affiliate of funds also managed by Alden Global Capital. The second JRC bankruptcy prompted Gigaom.com's analysis of the restructuring going on in the daily newspaper business.
Alden Global Capital's skeletonizing of newspapers for investor profits is described in articles online, two being about the St. Paul Pioneer Press and The Denver Post.
276: Update Alert. Big changes in the two parnerships on this page. In June 2015, Gannett gave up its 19.49 percent stake in the California Newspaper Partnership, and it also took over complete control of the Texas-Newspaper Partnership with its seven newspapers as well as three newspapers in Pennsylvania. Gannett is in the process of splitting into two companies — the one named Gannett will concentrate on publishing, and a second publicly owned company named TEGNA will focus entirely on broadcast and digital businesses. The spin-off is expected to be completed in mid-2015. With this deal, Gannett has total ownership of the El Paso Times in Texas as well as the New Mexico dailies in Alamagordo, Carlsbad, Farmington, Deming, Las Cruces, and Silver City. It also now owns the Pennsyvlania papers in Chambersburg, Hanover, and Lebanon, and takes over the York JOA previously owned by MediaNews Group.
277: Update Alert. On the "At A Glance" chart for top U.S. TV owners, delete Belo Corp., which was bought by Gannett in 2013. Also, add Media General, which with its purchases in 2014 now has 74 stations reaching 23 percent of the U.S. market. As of early 2014, the numbers of stations for the listed companies with changes are: Tribune Co., 42; Sinclair, 167; Gannett, 42; Hearst, 27; Cox, 14; Raycom, 53.
278: Update Alert. Google obtained approval for its purchase of Motorola Mobility from the trade regulators of the United States, European Union, and China in early 2012 and completed the acquisition that May. In August, Google announced it would lay off 4,000 employees and close one-third of the Motorola's locations. It sold its Motorola Mobility plant in China and closed its South Korea plant in December 2012 amid rumors that the purchase might be "Google's biggest mistake."
278: Update Alert. Major media transactions for 2012 after the book's deadline should be added to the list. They are:
- In late 2011 and late 2012, San Diego hotelier and real estate developer Doug Manchester and his business partner John Lynch bought both of San Diego County's daily newspapers. They bought the San Diego Union-Tribune in late 2011 from Lee Enterprises for a reported $110 million, renaming it U-T San Diego and using it to champion the military, conservative politics, and San Diego business interests.
- Alden Global Capital, which acquired the Philadelphia Inquirer and Philadelphia Daily News in 2010, sold the papers in April 2012 for about $55 million to another investment consortium named Interstate General Media LLC. The sale gave the Philadelphia dailies their fifth owner in six years.
- Alden Global Capital began breaking up and selling parts of Freedom Communications, which it acquired through bankruptcy in 2010. In addition to selling Freedom's eight TV stations to Sinclair in late 2011 (see No. 9 in the list), Alden sold several of Freedom's smaller newspapers in several states in three other deals.
- Media General almost entirely exited the newspaper business in June 2012, selling 22 dailies (keeping only the Tampa Tribune in Florida) and 41 of its weeklies for $142 million cash to World Media Enterprises Inc., a subsidiary of Warren Buffet's Berkshire Hathaway Inc. Media General's chairman and former CEO, J. Stewart Bryan III, said the company had to sell its newspaper division or file for bankruptcy protection. Berkshire will also lend Media General $400 million and provide a $45 million line of credit. The former Media General newspapers will be operated by BH Media Group, a susidiary of Berkshire Hathaway. The deal makes Warren Buffet one of the largest owner of American newspapers, with 25 dailies that have a weekday circulation of 800,000. For details, go here.
- Newly formed 2100 Trust LLC purchased what remained of Freedom Communications from Alden Global Capital in July 2012 for an undisclosed amount. Alden Global Capital's investors had been breaking up Freedom and selling its assets over a period of 18 months.
Detais of 2013:
- The most startling media transaction news by mid-year came over one long weekend when billionaire John W. Henry bought the Boston Globe and other New England papers on July 3 for $70 million, and billionaire Jeff Bezos bought the Washington Post for $250 million on July 5. The purchases might mark the return of newspaper ownership to private families, a tradition that was interrupted by the domination of national and international conglomerates over the last seveal years. For a discussion of that aspect in the Boston Globe and Washington Post purchases, see the Slate article "The era of family newspapers is back." For a business analysis of those purchases, see the Cape Cod Today article "Analysis of the sales of the Boston Globe and Washington Post. In his first interview since agreeing to buy the Washington Post, Jeff Bezos talks about his plans to bring about a new "golden age" at the newspaper. Meanwhile, John Henry completed the purchase of the Boston Globe on Oct. 24, 2013, and writes an opinion column on why he bought the newspaper. Why are billionaires investing in newspapers? Read the reasons here.
- After its second bankruptcy in two years, Journal Register Company newspapers were purchased by 21st CMH Acquisition Company, an affiliate of the hedge fund Alden Global Capital. (Digital First Media manages both JRC and MediaNews Group). An interesting Q&A with Digital First CEO John Paton about the complicated deal can be seen here.
- News Corp. sold the 33 newspapers in its Dow Jones Local Media Group in September 2013 to GateHouse Media. Within a month, GateHouse began layoffs at several of the papers, including all the photographers at the Middletown (NY) Times-Herald. Other major U.S. metro dailies went on the market in early 2013, with the Tribune Co. courting possible buyers for the Chicago Tribune, Los Angeles Times, Baltimore Sun, and its five other dailies.
- New Media Investment Group, only months after it was formed, paid $280 million for the Florida-based Halifax Media Group, which owned 24 dailies and 11 weeklies. Halifax was owned by Arkansas billionaire Warren Stephens..
- In television, two deals were announced in December. Tribune Co. acquired Local TV Holdings' 19 TV stations for $2.73 billion in cash (see Bloomburg analysis), and Gannett purchased Belo Corp.'s 20 TV stations and networks for $1.5 billion plus $715 million in existing debt. Also, Sinclair increased its holdings in 2013 with deals totaling $10 billion, and in an $860 million deal Media General took over New Young Broadcasting Holding Co.
- MediaNews Group merged with 21st Century Media to form Digital First Media.
Details of 2014:
- Tribune Publishing, the newspaper company spun off from Tribune Co., whose papers include The Los Angeles Times, bought the Carroll County Times and the The Capital in Annapolis, giving it a cluster of papers around The Baltimore Sun, which it also owns, with the three papers being marketed as the Baltimore Sun Media Group.
- AT&T announced it wanted to purchase of DirecTV for $48.5 billion. A Reuters story explains the issues being addressed. AT&T is the nation's second largest wireless carrier, while DirecTV is the largest satellite TV provider.
- Killed was a Comcast Corp. attempt to buy Time Warner Cable Inc. for $45.2 billion in stock. That deal would have combined the two largest cable operators in the U.S., which an analysis says could raise antitrust concerns. Federal regulators rejected the merger, so Comcast walked away from the deal.
- Media General became the second-largest owner of U.S. local stations in March by purchasing LIN Media for $1.6 billion in cash and stock plus $968 million in assumed debt. The combined company owns 74 stations in 46 markets, reaching 23 percent of the U.S. market. The largest broadcaster is Sinclair Broadcast Group, which owns or provides sales services to 167 television stations in 77 markets, reaching 38.7 percent of U.S. television households. The transaction was explained by Bloomburg.
- A bitter struggle between investors for control of the Philadelphia Inquirer and the Philadelphia Daily News ended in May when businessman Lewis Katz and philanthropist H.G. Lenfest outbid others in an auction and bought the paper for $88 million. The Philadelphia company had sold twice in 2006, once for $500 million, and went into bankruptcy in 2009.
- Tribune Publishing bought several Chicago suburban papers from Sun-Times Media, totaling six dailies and 32 weekly papers. The price was not disclosed. Sun-Times Media has been owned since 2011 by the investment firm Wrapports.
- The Minneapolis Star-Tribune was sold to billionaire Glen Taylor, owner of the NBA Minnesota Timberwolves basketball team and the WNBA Minnesota Linx basketball team. The newspaper's sale reads like a diary of the decline in newspaper values and the takeover by investment firms. The McClatchy chain bought the newspaper for $1.2 billion in 1998, but sold it for $530 million eight years later. The paper declared bankruptcy in 2009. Before its current sale, it was majority-owned by the private equity firm Wayzata Investment Partners. Price was not revealed.
Details of 2015:
- Stephens Media Group, owner of Nevada's largest daily, the Las Vegas Journal-Review, was sold for $102.5 million cash in February to a year-old investment company, New Media Investment Group. Stephens Media had been privately owned by Arkansas billionaire Warren Stephens. New Media, with offices in New York City and Pittsford, N.Y., currently operates 133 daily newspapers and 250 paid weekly publications nationwide. It is publicly traded and managed by an affiliate of Fortress Investment Group, which also owns GateHouse Media (formerly Liberty Group Publishing, which had earlier swallowed Community Newspaper Group and Enterprise News Media). With the deal, New Media Investment Group became the publisher of more newspapers than any other conglomerate.
- Verizon spent $4.4 billion to purchase AOL, one of the Internet's oldest brands since introducing America Online a generation ago.
- Charter Communications Inc. announced in late May that it had reached an agreement to buy Time Warner Cable for $55.33 billion. The deal still needs to be approved by federal regulators, which had killed Comcast's attempt to buy the cable giant. Charter is a smaller company than Time Warner Cable, but it's backed by media billionaire John Malone. If approved, the merger would vault Charter into the ranks of the leading U.S. broadband and pay-television companies
- Tribune Publishing bought the largest daily in San Diego, U-T San Diego, for $85 million from real estate developer and hotel owner Doug Manchester in May. Tribune Publishing also agreed to assume U-T's pension liability, estimated at $100 million.
- Gannett purchased from Digital First Media the full control of the El Paso News in Texas and also six New Mexico newspapers it had been operating under the Texas-New Mexico Newspapers Parnership since 2004. The deal also sold to Ganett three papers in Pennsylvania. Digital First Media is based in Denver and owned by MediaNews Group. See page 267 notes for more details.
- Biggest merger news in December 2015 was when it was announced thar the Las Vegas (Nev.) Review-Journal had been purchased by an secret buyer, selling for a highly inflated price of $140 million. GateHouse Media, which had bought the paper just a few months before, reportedly flipped the paper for a 60 percent profit. The Review-Journal reporters discovered that the paper was purchased by News + Media Group, which is controlled by billionaire Shelden Anderson, who owns several casinos in Las Vegas. Details of the unusual purchase can be read at the New Yorker site.
- A year-end summary of several newspaper mergers in 2015 can be read here. A year-end summary of severa magazine and digital property sales in 2015 can be read here.
So far in 2016:
- Nexstar Broadcasting Group agreed to buy Media General on Jan. 26 in a deal valued at $4.16 billion including assumption of debt. The new company will be renamed as Nexstar Media Group when the deal is final. Nexstar would become the owner of 171 television stations serving 39 percent of the U.S. population. Nexstar paid a $60 million "break-up fee" to Meredith Corporation because the purchase derailed merger talks between Meredith and Media General. During the year, Nexstar sold about a dozen of those TV stations to smaller companies as a condition to receive FCC approval. The deal would make Nexstar the nation's second largest broadcaster.
- Digital First Media paid $49.8 million in cash and purchased the California dailies Orange County Register and the Riverside Press-Enterprise after the federal government blocked a purchase effort by The Tribune Company. Digital First's largest shareholder is hedge fund Alden Global Capital. Read about the purchase here.
- The U.S. Department of Justice approved Charter Communications' $65.5 billion acquisition of Time Warner Cable and Bright House Networks. The FCC had still not approved the mergers as of late April, but its chairman has recommended approval. If the deal goes through, the "New Charter" will become the nation's second largest broadband provider and the third largest cable TV provider. Charter is backed by media billionaire John Malone. Details of the merger as of late April can be seen here.
- On May 16 Gannett offered to buy Tribune Company for $15 a share and also assume about $385 million of Tribune's debt, making the total offer at about $864 million. Tribune's Board of Directors had rejected a previous Gannett offer of $12.25 a share. Details as of May 20 can be seen here.
- In July, Verizon and Yahoo agreed to an $4.83 billion cash deal that would give Verizon control of Yahoo's operating division only about a year after Verizon bought AOL. The addition of Yahoo to Verizon/AOL would create one of the largest portfolios of owned and partnered global brands with extensive distribution capabilities, and Verizon expects approval by regulatory agencies in early 2017.
- In August, Univision bought most of the assets of Gawker Media for $135 million two months after Gawker filed for bankruptcy in the libel lawsuit brought by professional wrestler Hulk Hogan. Gawker went bankrupt when it lost Hogan's $140 million lawsuit. Gawker founder Nick Denton and Hogan agreed Nov. 2 that Denton would pay $31 million to Hogan to settle the suit. Hogan's lawsuit was at least partly financed by Silicon Valley billionaire Peter Thiel. For a discussion of asset purchases of a business, see page 298 in the textbookl.
- In what CNN is calling the "media merger of the decade," it was announced in late October that telecom giant AT&T has agreed to buy Time Warner for $85.4 billion. The merger would result in Time Warner cable and TV shows being available to consumers on their smart phones. The merger still must be approved by federal regulators before it can go into effect. If the deal goes through, AT&T will own Time Warner properties such as CNN, HBO, TNT, Warner Bros. Studio, Cartoon Network, and Time Warner Cable, among many others. AT&T's new corporate mission is that the future of mobile is digital, and the future of digital is mobile. The merger would pursue the goal of providing access to the vast content of Time Warner to the maximum number of customers, which AT&T would serve as the distributor through its wireless, broadband, and satellite services. AT&T would pay $107.50 per Time Warner stock -- half in cash and half in stock. Numerous stories are on the Internet constantly updating developments in the proposed merger.
The 2003 first edition of Media Management in the Age of
Giants provided one of the first discussions of free daily
newspapers, even though a few such papers had been around since the 1970s. The
start-up of about 10 more free U.S. dailies just since the book's
first edition, however, finally made this business model too large
for the newspaper industry to continue pretending it doesn't exist.
An article on free dailies was in a 2005 issue of the Christian
Science Monitor titled "All the news that's fit to be
303: Update Alert. An analysis of the nonprofit journalism model was produced by the Pew Research Journalism Project in October 2013.
317: Backgrounder. The
Millennium Technology Prize of 2004 cited the importance of World
Wide Web creator Tim Berners-Lee's decision not to commercialize
or patent his contribution to the Internet technologies. "If
I had tried to demand fees...there would be no World Wide Web,"
Berners-Lee explained. "There would be lots of small webs."
324: Update Alert. In late summer and early fall 2013 Advance Publications will move two more of its metro dailies to an emerging business model of home delivery only a few days a week and online all week. The Cleveland Plain Dealer will be available on newstands, but delivered only on Sunday and two other days. On or about Oct. 1, the Oregonian will be delivered only four days a week: Wednesday, Friday, Saturday, and Sunday. Both papers will lay off staff. (Fifty newsroom employees were laid off from the Plain Dealer in July 2013.) The New Orleans Times-Picayune, a 175-year-old daily owned by Advance, stopped daily publication in October 2012 and went to three-day-a-week home delivery, as have the Detroit dailies and other Newhouse-owned Advance papers in other states. In January 2013 Advance reduced home delivery to three days a week for the Harrisburg (PA) Patriot-News, which won a Pulitzer Prize for its coverage of the Penn State scandal. Also in 2012 Advance reduced home delivery of its Alabama dailies in Birmingham, Mobile, and Huntsville to three days a week. Read Martin Langeveld's article, "The Coming Death of Seven-Day Publication." In February 2013 Advance reduced home delivery of The Post-Standard in Syracuse, N.Y.
USA Today published a 2013 analysis of the reduced-delivery strategy.
331: Update Alert.
a discussion of the The New York Times' first failed attempt at a Web paywall business model, abandoned in 2007, click here. Its more successful and current incarnation for a paywall model is examined in a 2011 Wired article. In January 2012, for the first time since the 1800s, Times circulation revenue surpassed advertising revenue, as discussed in a New York Magazine article. A paywall milestone was reached in 2015 when the Times passed the one million paid digital-only subscriber mark. Search online for newspaper paywalls for articles on the continuing debate.
333: Update Alert. More newspaper chains are moving to paywalls so they can charge for online access. In 2012, Gannett, the nation's largest newspaper publisher in terms of circulation, finished limiting nonsubscribers' free access to its newspapers (with the exception of USA Today) to only five to fifteen articles a month.
340: Update Alert. That nation's youngest cable TV director in the 1980s, Richard Silman, called the book's author recently. He reported he didn't have a driver's license yet in 1982 so he rode his bicycle 16 miles to get to work. He said he started work at the cable TV station because of his interest in video as a kid. He had to focus on his management skills because he was only 16 and all the employees under him were in their 20s and 30s. He still lives in Columbus, Ohio.
on book cover to return to home page.