September 26, 2014
/ by Katrina M Mendolera
Over the last several years a few news organizations have made headlines and stood out because of their experimental tactics and focus on expansion and growth within the newspaper industry. Two of those organizations have been Digital First Media and Freedom Communications. As the world watched, both publishing groups kept growing, launching new papers and initiatives until the day they both began to fall from the mountain of coding and newsprint. Interestingly enough, the brains behind the two news organizations had very different ideas on how to run a successful newspaper business.
Founded in 2011 and led by CEO and mastermind John Paton, Digital First Media (DFM) manages Media General and Journal Register Company. With a heavy focus on community engagement and digital, it seemed at one point as if Paton was king of the newspaper evolution. But in April, DFM announced it would be shutting down Project Thunderdome, an initiative that was created to streamline non-local coverage to the company’s 76 dailies. And with that development, the news organization began to lose its greats: DFM digital transformation editor Steve Buttry, editor DFM Jim Brady and Thunderdome editor Robyn Tomlin, were among those who were either laid off or left as a result of the project’s dismantling.
Then last week, Paton announced that the company had hired UBS Securities to help DFM look at options, including selling the company, selling regional clusters or staying as-is. This follows the announcement in August that 51 of its newspaper buildings had been put up for sale. If the company’s before-mentioned 76 dailies and 160 weeklies sold together, it could make it one of the biggest newspaper sales in history, Ken Doctor a newspaper analyst with Outsell Inc., told the Denver Post. Although according to Doctor the likelihood is the papers will be sold of regionally.
“The key to the southern California map is finding the real synergies of smartly combining business and editorial work within the larger single geography. These kinds of synergies are much more likely to be real — and countable — than the potential synergies of a still far-flung “national” newspaper company,” wrote Doctor.
On the other end of the spectrum we have Aaron Kushner, who along with Eric Spitz, purchased Freedom Communications two years ago. Throughout his ownership, Kushner has pushed the print product, packing on the staff and nearly doubling the number of newsroom employees, launching new products and thicker sections. Then in June, the organization announced that they were instituting mandatory two-week furloughs as well as buyouts and layoffs and reducing page counts by a quarter. Along with that sour news, one of the newly minted papers, the Long Beach Register, was folded into the Orange County Register’s Los Angeles edition.
This week, more bad news came from the news organization with the announcement that the Los Angeles Register, a daily that only debuted approximately five months ago, had folded. Layoffs were also a part of the newspaper’s quick demise, with roughly 20-some staffers being let go. “The basic strategy was pretty badly flawed from the get-go,” Rick Edmonds, a newspaper analyst with the Poynter Institute told LATimes.com.
In a memo, Kushner and Spitz reportedly noted they would continue to analyze the best way to move forward by analyzing geographic areas in relation to the newspapers as well as profitability in terms of news topics.
All things considered, it looks as if Digital First Media is moving onto new ownership, either together or in newspaper clusters. Meanwhile, Doctor suggested in a recent article that at this time next year we can expect to see Freedom Communications under new ownership as well. No doubt like a phoenix, new forward-thinkers will arise from the ashes with new ideals and initiatives for a better newspaper world.
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