Why is the LA Times Investment Good & Bad News?
The LA Times story today reporting on a new infusion of cash – $44.4 million – in its owner, Tribune Publishing, is good news and bad news for journalism.
The purchase of a major stake in Tribune Publishing by a Chicago entrepreneur, Michael Ferro, is expected to help the company’s planned bid to buy the Orange County Register and the Riverside Press Enterprise from bankrupt Santa Ana publisher Freedom Communications.
Ferro, through his firm Merrick Media, already owns the struggling Chicago Sun-Times. So his willingness to buy a 16.6% stake in Tribune Publishing and become its largest shareholder is commendable. The LA Times notes that Ferro’s investment more than doubles the amount of cash Tribune Publishing has available to expand its Southern California footprint by purchasing the Register and the Press-Enterprise.
If this investment leads to a purchase, it could well ensure the survival of the two papers. That would be good news for the communities they serve. Local and regional news outlets serve as watchdogs on local elected officials, organizations and agencies. They ensure the public is better informed about their own communities, schools and activities, and many contribute to the well-being of the community through educational and other programs.
But a purchase by Tribune Publishing likely will bring about further consolidation of the news function, and that’s also bad news for reporters and the public. Already, newspaper consolidation in the greater Los Angeles area has resulted in reduced ranks at local newspapers. The Daily Breeze, for instance, has just five city-side reporters. When one of their own won the Pulitzer Prize for local reporting, he was no longer with the paper. He’d gone into public relations because he couldn’t support his family on the salary he was being paid as a reporter.
Consolidation also leads to a loss of perspectives. Publications that once scrambled to compete against one another are now collaborating. That takes away from the determined pursuit of the “scoop” and limits the differing views of differing reporters on the same story.
One example: At a California political party convention, the party’s delegates booed and jeered one of the party’s elected leaders during a speech on the last day of the weekend event. The LA Times reporter already had developed a beautifully written story about the future of the party, so he chose to ignore this stunning turn of events. The Sacramento Bee reporter (me) wrote about the delegates’ response. His readers received a more thoughtful look at the party’s future, while the Bee’s readers read about the delegates’ discontent with one of the party’s standard bearers. Those differing views are lost when just one journalist from one news outlet reports on an event for all the papers in the chain.
The proliferation of blogs and online outlets, for the most part, cannot make up for these losses because bloggers tend to comment – rather than provide “objective” coverage of the news. Moreover, most bloggers don’t have the budget or the time to actually attend all the events, court hearings, City Hall meetings, etc. that newspaper reporters do. (It should be noted, however, that a day on a presidential campaign is so costly that many of the mainstream publications have given up on being one of the “Boys (or girls) on the Bus.” So newspapers aren’t doing nearly as much of this type of coverage.)
Granted, the cost-savings of consolidation may be the only way for newspapers to survive in the changing media landscape. The loss of advertising dollars and subscribers has slowed. But the downward trajectory continues – as does the loss of news jobs. The Pew Research Center’s latest report found newspaper circulation down another 3% in 2014 and 19% since 2004.
The Pew Research Center also reported that while revenue from circulation rose, ad revenue continued to fall, with gains in digital ad revenue failing to make up for falls in print ad revenue. In addition, it said several larger media conglomerates spun off their newspaper divisions as separate companies in an attempt to prevent the newspaper industry’s woes affecting the health of their broadcast divisions.
Given these facts, the future of newspapers undoubtedly depends on greater consolidation. The question now is what actions can newspapers, with their declining resources, take to overcome the loss of differing voices and the competitive drive that has been the hallmark of journalism? What are your thoughts?