The newspaper industry has struggled for most of the 21st century, as the growth of digital media has profoundly affected revenue previously generated by print advertising and newsstand sales. At the same time, Facebook and Google grabbed a large chunk of digital ad revenue, effectively blocking the industry from one of its traditional sources of money.
Approximately a quarter of newspapers in the United States, most of them weekly, were closed between 2004 and 2019, while about 50% of newspaper jobs were eliminated. Hedge funds, however, see newspapers as a potential bargain. With a strict management style that usually means job cuts and reduced coverage of local news, they have been able to pressure them to make a profit.
In the process, they often angered their employees. Journalists at The Denver Post, a daily newspaper controlled by a media company Alden, rioted in 2018 by publishing a special section of opinion essays that attacked the hedge fund, comparing its executives to “vulture capitalists”. Alden previously ordered the Post to cut 30 jobs in a newsroom that was reduced to 100 editorial staff, having already lost a significant number of journalists to layoffs and acquisitions since the company took over in 2010.
Penny Abernathy, a former New York Times and Wall Street Journal executive who studies the economics of local media at the University of North Carolina journalism school, said Alden’s background is not a good omen for Tribune Publishing newspapers. that may be under your control.
“Based on the model that Alden has used so far, this is a contraction in the industry without significant investment for the future of newspapers,” she said. “One of the problems with these large networks is that they are disconnected, journalistically and economically, from the communities that these newspapers serve.”
Some journalists working for Tribune Publishing newspapers – which also include The Orlando Sentinel and The Hartford Courant – tried to persuade wealthy benefactors to intervene before the hedge fund gained more shares. Last year, two reporters from the Chicago Tribune sent letters to Chicago luminaries urging them to buy the newspaper.
In an interview on Tuesday, Gregory Pratt, president of the Chicago Tribune union and reporter for the city, did not seem optimistic about the deal. “This is very bad,” he said. “It is not good news. Alden is the worst in the news world, and that already says something, considering the variety of bad actors out there.