Commentary

Newspaper Owners Failed To Act - Now They Face Alden Global Capital

by Tony Silber , Staff Writer, December 2, 2021

The fight for control of Lee Enterprises continues this week, but you’ll forgive me if I suggest it all might be futile. In the end, shareholders always go where the money is — and company executives and boards of directors have a fiduciary responsibility to do that as well.

On Monday, 12 unionized newsrooms of Lee Enterprises released a letter to the company’s board of directors urging it to reject the hostile takeover bid by Alden Global Capital, saying a future under Alden will bring nothing but despair.

Alden, which acquired the Tribune Company earlier this year and owns more than 200 newspapers, is a hedge fund notorious for stripping the media brands it acquires of reporters, editors and resources.

Lee, based in Davenport, Iowa, owns 75 daily newspapers, including the Buffalo News and the Richmond Times-Dispatch, as well as more than 350 weekly and specialty papers.

The 12 unions are from some of Lee’s most prominent newspapers, including the Omaha World-Herald, The Buffalo News and the Richmond-Times Dispatch. In the letter, the Lee Enterprises unions noted a comment from Alden saying the takeover bid is a reaffirmation of its commitment to the newspaper industry. “That is a bold-faced lie,” the letter stated. “Look to the many examples of newsrooms now operated by Alden, and you will find not one that is better position to serve its community.”

Alden, the letter continues, has cut staffs at twice the rate of its competitors. It has created untenable workplaces that make it impossible to retain talent. It has closed physical newsrooms, leaving reporters to work from their cars.

As impassioned and compelling as the letter is, its concerns have become a standard component in the process of Alden takeovers. Journalists mount desperate attempts to stop a takeover. They create fact-finding websites. They release letters. They band together to seek other ownership options. They lobby boards of directors and local entrepreneurs. Then Alden gets what it wants.

Perhaps the tide will turn at some point. After all, newspapers enjoyed decades of monopoly status in their served markets. Until they didn’t.

They exploited reporters, underpaid them while maximizing profits. They responded with monumental ineptitude to the rise of the internet. To this day, most newspaper websites are a rude joke on readers, swirling and flashing with invasive and intrusive ads, obscuring the content to the point the reader gives up.

As important as journalism is to democracy, newspaper owners rarely did the right thing when they had a chance. Now, they all see Alden Global Capital in their rearview mirrors, gaining on them fast.

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2 comments about "Newspaper Owners Failed To Act - Now They Face Alden Global Capital".

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Ed Papazian from Media Dynamics Inc, December 2, 2021 at 10:11 a.m.
Tony, what we are seeing is flocks of buzzards circling over a field of dead---or dying---bodies. Sadly, it's way too late to think of a revival of printed local news editions drawing mass audiences on a daily basis---though once-a week weekend editions with special features about local and regional doings, entertainment opportunities, vacationning, dining, etc. may have prospects. As for the newspaper websites, here, the opportunity still lingers----if these were organized properly with many, timely, editorial items that were exclusive to website readers and if a proper ad sales effort was mounted---but that seems like idle dreaming to me.

So I agree with your conclusion---but I'm not so sure that all of the blame falls on the publishers. As with magazines---who have made many of the same mistakes---newspaper editors should carry their share of the blame as many of them persisted in thinking that the 21st century world wanted everything presented in printed morning editions---not in anytime on-demand digital fashion----and that the main purpose of their websites was to sell their printed editions. And the unions also played a part. How many dailies closed shop after a union strike---demanding higher slaries when the papers were no longer turning profits? And what about the unionized---can't be fired---ad sales forces at most dailies?How many of these people have any idea about audience attainment or how other media are perceived by advertisers, their CPMs, reach and frequency patterns, demos, etc. Not many. How effective were these unionized sales folks at capturing new accounts---or holding old ones?

I think that the debacle facing the daily newspaper industry---a few "national dailies" excepted---was set into motion by many people who worked in this industry---not just the publishers.
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Tony Silber from Long Hill Media, December 2, 2021 at 10:42 a.m.

Ed, thanks for adding context and insight. I agree with you, while also noting that very few editors, reporters or ad-sales pros understood the impact that digital media would have on publishing. So yes, they share some responsibility. In the early days of the commercial internet—that is, the mid 90s to the early 2000s, when people were still on dial-up connections and there was no broadband, the near-universal approach was to dump print content on the website. And that was it. Those who did create original digital content staffed it with their B Teams. During this transition period, the money was still made in print—by a long shot. It took 15 years or more for that to decisively shift.