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Tuesday, March 13, 2007

SJR sold

Noting a moment in history. It was announced today that our local daily newspaper, the State Journal-Register has been sold to "one of the largest publishers of locally based print and online media in the United States," Gatehouse Media of Fairport, New York. From the breaking news article:

Gatehouse announced the purchase this afternoon. Gatehouse is paying a net of $380 million for the nine publications, according to a GateHouse news release.

Among the other papers is the Peoria Journal Star.

The transaction is expected to close before the end of April and is subject to regulatory approval and customary closing conditions.

This took from January 1st to today. (That we know of.)

Sue Schmitt, publisher of The State Journal-Register, said the newspaper's role in the community won't change.

She says that now. But, we know it will change. They always say something like that when a local bank gets sold to a big conglomerate and look what happens to them. To the writers, staffers, and employees, good luck. And good night.

Edit to add: Seller Copley Press, until this sale, "publishes 10 daily, 9 weekly, and 1 bi-weekly newspapers." (Wiki.) Whereas, Gatehouse owns "445 community publications, including seven white and yellow page directory publications in 18 states and more than 235 related web sites..." (Press release, for which I don't have a permalink.) We pretty much know who owns Copley News. Who owns Gatehouse?

Posted by Marie at March 13, 2007 11:55 PM

Comments

All of our local newspapers and television stations are owned by conglomerates/syndicates of one kind or another. I wonder what editorial influence they wield over the news. Dan might be the one to ask.

Posted by: Rob Author Profile Page at March 14, 2007 12:15 PM

GateHouse Media Inc. is publicly held, which means that you can read about their business in SEC filings and find out about their ownership. As it happens, the company just filed its annual report for 2006 (http://investors.gatehousemedia.com/secfiling.cfm?filingID=1193125-07-52745).

The ownership questions takes some careful reading and research, but here's a start: GateHouse was until last year known as Liberty Group Publishing, based in Northbrook, Illinois; Liberty has been on a pretty steady and aggressive acquisition path for the last few years. The company CEO is a community newspaper pro from Alabama.

It turns out that GateHouse/Liberty, in turn, is controlled by a big New York-based outfit called Fortress Investment Group (http://www.fortressinv.com/site_content.aspx?s=16); they handle money for wealthy people looking for a solid return and have investments everywhere, including, now, your hometown paper. To take the exercise one step further, you can look at the boards of directors at GateHouse and Fortress and check on their political leanings by running their names against the Opensecrets.org database. I did that for Wesley R. Edens, the chairman of both GateHouse and Fortress, and found that in the last couple election cycle, he was a dependable contributor to Democratic congressional candidates (including Rahm Emanuel, for another Illinois connection). Opensecrets also allows you to look up donors by employer, and the people listed as from Fortress Investments looks like they lean pretty strongly Democratic (though there were a couple stray donations to Bush in the '04 cycle, too).

As to Rob's question about editorial influence, I think the most important effect owners have on news media holdings is through their investments in the product. In other words, how much will they pay to support a newsgathering operation? As everyone knows, these are hard times for news organizations, especially papers, because their ad base is being seriously eroded by online alternatives and they haven't figured out how to retrench their operations yet. So mostly they resort to cutting costs--i.e., firing people--which in turn reduces further the scope and effectiveness of news coverage. It's a losing formula, but that's what the industry is into these days. I'd think the fact the papers are now owned by someone who looks at them first as assets that need to perform financially is not great news for their editorial quality; but the future is probably not a whole lot different from what you'd see had Copley hung onto the SJR. That's my two cents, anyway.

Posted by: Dan at March 16, 2007 11:18 AM