Up and Coming Weekly is a weekly publication in Fayetteville, NC and Fort Bragg, NC area offering local news, views, arts, entertainment and community event and business information.
Issue link: http://www.epageflip.net/i/944388
14 UCW FEBRUARY 21-27, 2018 WWW.UPANDCOMINGWEEKLY.COM Every city and town needs and deserves a strong and committed local daily newspaper. For nearly 100 years, The Fayetteville Observer has served this community and was hailed as North Carolina's oldest and most respected continuously privately owned daily newspaper – until it sold to private equity newspaper con- glomerate GateHouse Media in 2016. Though it remains the oldest newspaper in North Carolina, it is no longer privately owned, nor, as many resi- dents will attest, does it relate to the community. After the acquisition and a short honeymoon with the Fayetteville community, GateHouse Media started doing what it does best – disman- tling the company. In December 2017, Robert Kuttner, co-founder and co-editor of The American Prospect maga- zine and professor at Brandeis University's Heller School, co-authored an excellent article explain- ing in vivid detail what is taking place in hun- dreds of cities, towns and communities across the country. The article, "Saving the Free Press From Private Equity" was co-authored by Hildy Zenger. Hildy Zenger is not her real name since she works for a newspaper owned by the private equity firm GateHouse Media. She is a talented writer who gives us an up-close-and-personal perspective of the havoc and carnage created by GateHouse Media as it and other private equity companies employ "scorch and burn" policies. What follows is an account of the plight and devastation experienced by the newspaper in- dustry and how it relates to what happened to The Fayetteville Observer and how it affects the com- munity. What is happening to our daily newspaper is, sadly, happening in hundreds of cities and towns across the country. However, many communities with vision, dedicated leadership and a strong sense of American democracy have been able to rebuild this valuable conduit of truth, fairness and account- ability in government. I hope we are one of them. All excerpts from "Saving the Free Press From Private Equity" are referenced and reprinted with permission. Read the entire article at: prospect.org/article/saving-free-press-private-equity. Monopolistic arrogance caused daily newspapers to ignore a changing industry. The advent of digital media has created a huge challenge for printed newspapers. Social media showed up on the scene about the same time as the 2008 recession and was followed by the private equity industry. These mer- ciless Pac-Man-style companies began buying up newspapers that fell victim to the recession. They had no interest in news, media, publishing or com- munities. All they were interested in was massive layoffs, selling off assets and skimming off profits until the newspapers finally went out of business or filed for bankruptcy. They made huge profits. It's sad for the victim newspapers and even sadder for American democracy. Cities and towns have always depended on daily and weekly newspapers for local news and unbiased investigative reporting. Without ac- countability, the business of local, state and federal governments becomes veiled in secrecy. Without the media, without reporters, without the press, the Fourth Estate cannot serve as the lynchpin of truth and honesty, keeping the executive, legislative and judicial branches of government in check. Saving the Free Press From Private Equity Local dailies and weeklies are in a slow death spi- ral. They missed the digital rendezvous. … Operating losses cause owners to lay off staff and shrink con- tent, further depressing readership and ad income, leaving little to reinvest in digital. Local web-only media are feisty in a few places, but no substitute for a robust newspaper, whether print, web or a blend. It is here that GateHouse Media enters the Fayetteville community as the private equity play- er. Private equity has been gobbling up newspapers across the country and systematically squeezing the life out of them to produce windfall profits, while the papers last. Robust civic life depends on good local newspapers. Without the informed dialogue that a newspaper enables, the public busi- ness is the private province of the local commercial elite, voters are uninformed, and elected officials are unaccountable. There are many private equity firms in the industry, but the most vicious and merciless one is GateHouse Media. The malign genius of the private equity busi- ness mode … is that it allows the absentee owner [GateHouse Media] to drive a paper into the ground but extract exorbitant profits along the way from management fees, dividends, and tax breaks. By the time the paper is a hollow shell, the private equity company can exit and move on, having more than made back its investment. Whether private equity is contained and driven from ownership of newspapers could well determine whether local newspapers as priceless civic resources survive to make it across the digital divide. … The Bastrop Daily Enterprise in the northeast corner of Louisiana was founded in 1904, part of a small family-owned chain. The newspaper did a thriving business, with 30 employees and $1.5 mil- lion in annual revenues. "We served our communi- ties, won awards for our reporting, and made good money for the owner," says a former staffer. … Then the Enterprise was bought by GateHouse Media, the newsroom was gutted, and all operations were centralized by the new corporate owners. "Now they've got maybe eight people," says this former employee. "They're lucky if they're doing $600,000 gross. I remember what these papers used to be. It's unrecognizable." Few citizens of Bastrop, however, know the reasons behind the wasting of the Enterprise because no one has reported on it. Sound familiar? Let's talk Fayetteville. The Fayetteville Observer, founded in 1816, had been owned by the McMurray family since the 1920s and is the oldest North Carolina paper continually publishing. … The paper has a daily circulation across 10 counties and had been profitable and well-managed. But family members, getting older, decided it was time to sell. Charles Broadwell, whose grandmother had been board chair, was the last family member running the paper. He engaged newspaper brokers to find a buyer. GateHouse, the biggest of the private equity players, took over the paper in 2016, making deep cuts in the newsroom and the business office, and moving the copy desk to their regional center. They raised the subscription price for a shabbier product. "It was like walking around at my own funeral," Broadwell says. While newspapers will never be the money ma- chines that they were in the glory days, they may yet endure as core institutions of American democracy. Zenger's newspaper, with a circulation of under 10,000, has been pillaged in classic private equity fashion. Its pre-GateHouse staff has been cut by 70 percent, and those who remain have not had a raise in almost ten years. The paper had its own in-house production and printing operation and had won de- sign awards, but GateHouse shut down and sold the press and fired the entire production staff. The paper is now laid out hundreds of miles away in Austin, Texas, along with most of GateHouse's 770 papers. The printing is done in another city, at a GateHouse- owned shop, by harried press workers who are under constant pressure to cut costs by reducing quality. It doesn't stop there. Editors must send all the content, page by page, to the GateHouse design center via a cumbersome, laughably outmoded software interface and then wait, often for hours, to see what the pages look like on their computer screens. They are not allowed to speak to the designers, who can be contacted only by email. The designers follow strict rules that make creative layout solutions virtually impossible. Gate- House wages are so low and working conditions so high-pressured and unpleasant that turnover among layout staff is constant – so mistakes are rampant. Although GateHouse management claims to be aggressively pursuing a "hyperlocal" digital ad strategy, its newspapers' websites – all with close to identical design – are stunningly ugly, hard to use, and filled with dated, soft feature stories of zero local interest. Its subscriber services – all outsourced – are Eulogy for the Fourth Estate? by BILL BOWMAN COVER STORY G at e H o u s e M edi a T M What is happening to our daily newspaper is, sadly, happening in hundreds of cities and towns across the country.