Commentary

'National Enquirer' Needs Investment To Rebound From Pecker Era

The exclusion of The National Enquirer from last week's announcement of a merger by parent company American Media Inc. has led to speculation about the supermarket tabloid's future.

Omitting the Enquirer from a deal announcement that mentioned AMI's 14 other magazines, such as Us Weekly, doesn't mean the tabloid is still for sale or will be shut down.

The publication has faced steeped drops in circulation to less than 100,000 issues from more than 4 million two decades ago, The Daily Beast reported. The coronavirus pandemic likely has damaged newsstand distribution even more, though supermarkets that carry gossip magazines have remained open during lockdowns.

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The merger of AMI to another company that's also owned by hedge fund Chatham Asset Management feels like an act of desperation. The deal came more than a year after AMI announced that James Cohen, CEO of Hudson News, had agreed to buy the company for $100 million. It's hard to imagine AMI fetching the same valuation in the merger with logistics company Accelerate 360, considering the pandemic's consequences for publishers.

A welcome development is the departure of David Pecker as CEO after years of unnecessary scandals -- even for a tabloid that pushes the edge of sensationalism. The "catch-and-kill" efforts to quell salacious stories about President Trump mired management in a legal morass before an eventual settlement.

An investigation into the sex life of Jeff Bezos pushed the Amazon CEO to accuse the Enquirerof extortion, and it's still not clear whether a reported federal investigation into the matter was ever resolved.

As for the Enquirer, the key question is how much the merged company will be willing to invest in the brand to revive growth. The tabloid faces daunting challenges as younger readers are more likely to follow celebrities on social media. The National Enquirerhas a weak digital presence, while online gossip publications have proliferated. Without additional investment, the brand will continue to lose value and may disappear.

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