Thoughts on the proposed Gannett-Gatehouse merger

Just "wow," especially as they seem to have diametrically opposite core cultures. Craphouse taking over Dead Fucking Media or vice versa? Yes. Ditto on, say, McClatchy or Hearst taking on Gannett or vice versa. But this? But here we are, and here's my take 10 days in, as both Gatehouse and Gannett sell this to investors etc.

Update, Oct. 9: Ken Doctor has details on the chainsaw side. Expect a 10 percent jobs cut; he notes 3K lost jobs would equal McClatchy's entire workforce.

Advertising, production, finance and circulation will take most of the cuts.

No surprise, in various ways.

• Advertising? I'd joked about CrapHouse having the idea of centralized programmatic ad sales. Might not be a joke now.
• Production? Most of Gannett's copy editors and graphic artists will be told to apply for jobs at CrapHouse design hubs.
• Finance? Centralized billing, which will surely get fucked up. CrapHouse may, at this size, make its collections all in-house. (And then peddle that as a service to other papers.)
• Circulation? Dunno how much actual savings is there, but stand by.

Back to the initial story.

Here's the company announcement, here's Ken Doctor's initial take at Nieman, and here's his follow-up analysis, complete with the "maybe" becoming more serious now that Alden Global Capital, owner of Digital First Media, aka Dead Fucking Media, apparently missed over Gannett's earlier rebuff of its takeover attempt, is spitting in the soup by allegedly taking a 9.4 percent stake in the new merger.

In his initial piece, Ken notes the two companies had become more comfortable with one another, and in the follow-up, that some sort of merger kind of fit both. Fortress Capital, still the de facto owner of Craphouse, was seeing its investment strategy run out of steam. A big acquisition helped. Gannett, kind of puttering around even before Alden's attempted takeover, probably could use a gray, if not totally white knight, and one further down the digital "transformation" road than it.

Later on, in talking to USA Today, Doctor says he thinks Alden might be looking at dumping its papers. Color me skeptical, with it's milking the Denver Post not for money for other papers, but for flailing and failing non-newspaper enterprises it owns. (Unless it thinks the last easy dollar has been milked out of that turnip.) Another angle, which I think more likely, is that Alden will do its best to cock-block this unless the combined company takes its papers off its hands.

And, where will they get that kind of money from, other than a potentially extortionate loan from Alden? So, Dead Fucking Media and Craphouse could have a dual between their hedge-fund owners, which would include Gannett being the piñata in a three-way bashing. (On the third or fourth hand, the apparently lying sacks of shit at Alden said 5 years ago they were looking to sell DFM.)

Now, the fallout?

First, Ken notes, the merged company (assuming federal approval) has to raise money to pay off loans.

Some of that comes through making two HQs into one. Some comes through whacking middle managers, especially, it seems, at Gannett.

And some will come from selling semi-orphan papers and concentrating on areas where one or both chains are already somewhat clustered.

Ken lists Florida, Wisconsin and Ohio. I see that.

But, why he missed Texas, I don't know. Gannett already had a number of properties here after its Journal-Sentinel takeover. Gatehouse, ditto, even before the Statesman buy in Austin. Combined, they'll own every 7-day west of I-35 except Plainview, Midland and Odessa. They'll have several five-day and six-days in North Central and West Central Texas.

Hearst owns Midland and Plainview. Dunno if it will sell or not. AIM Texas Media owns Odessa; all of its other papers are in the Valley. Would they swap Odessa, and maybe a little cash, for Alice? Would they sell out entirely, to the new chain owning Alice and Corpus now? Would Hearst swap Midland, or Midland and Plainview for Corpus, which would let it cluster more than now in Gulf Coast (plus San Antonio) Texas?

Finally, which of the two corporate cultures (assuming Alden remains spurned) wins out? Read Ken for that.

As far as what this will mean? There will be more local cutbacks. Probably at Gannett's papers; don't see how you can do much of that at Gatehouse, although they keep trying; Craphouse just laid off 14 at the Oklahoman, following on 37 cuts after it bought the paper a year ago. CNHI-type furloughs wouldn't totally surprise me if other savings don't materialize.

Gatehouse has an uphill slog on its side; Gannett has been sucking for years on ad revenue (more here); the most recent tumbles are sucking squared.

(Gannett may face one other problem; if its papers lose the Cars.com local exclusive rights like happens to the Snooze next year, in a couple of years, its auto ads money takes another hit.

As for online solutions? Yeah, Gannett may be behind the curve of Gatehouse, but when even the AP whores itself out to Taboola (and other) website clickbait as well as running its own clickbait stories, after whoring itself out to the advertorial world, any online "solution" is only going to be a possible bean-counter solution, not better news.

So, whether it's Gatehouse or Alden that takes over, if you live in most places in Central or West Texas, be prepared for your newspaper to go further in the gutter.

John Temple says Gannett and Gatehouse could suck either other down, with the combo of McNewspaper Gannett and corner-cutting cheapness Gatehouse. Temple, the last editor of the Rocky, recommends something like a public benefit corporation, noting the Philly Inquirer is run by one. I note that Hucksterman created a PBC that I even did a sonnet about and California laws on them — and seemingly many others states' — are pretty loose.

That said, speaking of bean-counters? A decade ago, the C-suite newspaper brass were still very much getting their own. I'm sure that's not totally changed. Long-time St. Louis Post-Distpatch columnist Bill McClellan, years after the date of that piece, continued to call out Lee Enterprises CEO Mary Junck for her corporate bonuses. (LOTS more about Lee at CJR.) Gannett's most recent CEO before the current one got a huge golden parachute a few years back.

Meanwhile, if this goes through, how will this affect current Gannett staff, readers and customers?

For you the employee?

Given that Craphouse has had its design shop for years, and from what I know, it sucking about as bad as Granite Newspapers' small one sucked (and yes, I believe it was done to spin off Gatehouse), if you're a graphic artist, you'll lose your job. You may be given "first-in-line" status to apply for the new (and lower paying) ones that Craphouse will create in Austin, but that's it. If you're not white, from what I've heard before, you might not want to work there anyway.

Given that Craphouse was aggressive enough on expanding its pagination shop to take on the Snooze on contract even before buying the Stateless, the same's going to happen to you as a copy editor. On, and their layout is get-it-out-the-door crappy once you get past section fronts.

Craphouse may consolidate some printing presses, too.

And, don't be surprised if the merged New Gannett adopts CNHI type furloughs.

For you the business?

Your ads will be crappier. You'll likely get one proof copy to review. Whatever errors you don't spot the first time around won't get fixed, or else you'll be charged extra.

For you the publisher?

Tighter paywall may bring more revenue to San Angelo, Abilene etc. Cross your fingers that Craphouse doesn't screw up ads enough you lose customers.

For you the reader?

Tighter paywall online. Deal with it. If you like the print version, and appreciate good design, you'll get less of that once you get away from section fronts. Also be prepared for fewer staff writers again. Breaking news? Late night sports? Look for it on the web; print deadlines will be earlier because of these new Gannett acquisitions being funneled through Gatehouse design and pagination shops, especially if more presses are consolidated. Hope you like your San Angelo paper being printed in Abilene.

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Update Sept. 28: The two companies say US regulators have given their OK. And Craphouse said it has already been cutting jobs in anticipation of that.

The Dallas Morning News is Snoozing toward Gomorrah

Having spent most of the previous decade at a group of suburban Dallas weeklies, I'm long familiar with the Morning News and have long called it the Snooze.

A $24.99 T-shirt that used to be, at least, on sale
at the Snooze Store! And, since the pic is off a
hyperlink, not direct upload, presumably the, no THE,
Dallas Morning News is still engaged in late-stage
capitalism grifting.

A.H. Belo long liked to pretend its shit didn't stink, even as it dumped some whoppers, starting with the Cue Cat! As I noted in one post, that was just one of many stupidities in the online world, detailed again here. Or here, where a former Google exec presumed Snooze readers would be unaware of the existence of AdBlock. (I know this "ads-free viewing" is still around today, but often with "hard" screens if you either don't pay or else don't turn off AdBlock. OTOH, many other places, like the Snooze then, had "soft" tut-tut screens.)

Those stupidities have real-world effect.

It's whacked another 40-plus people as ad sales continue to slip. (A 7.5 percent adhole on Christmas Eve, per my tracking of them, is horrendous, so this isn't a made-up problem. And, as is my wont, that counts obits as adhole inches.)

That's not the worst.

Giving 40 top execs $1.2 million in bonuses for a good financial management job achieved in part by whacking people? SEC link here.

THAT is the worst.

But, unsurprising. Also not surprising is the hypocrisy of publisher Grant Moise with his hand-wringing, when he got nearly $500K in stock options, bonuses and that management goals compensation — that alone being $250K. CFO Katy Murray got $100K just for the realignment. (And, this isn't the first time this issue has popped up.)

Weird are some of the positions that were NOT cut until this round. Example? The Snooze killed its Sunday book review pages, part of what used to be a full-section Sunday Review, a decade ago. But, it still had a books editor, even if part-time or freelance?

Sidebar: This may, or may not, be connected to a hedge fund buying a chunk of the Snooze. And, if you thought the paper already was slouching toward Gomorrah, that would be the kiss of death.

Three years ago, I looked at the background of executive editor Mike Wilson and managing editor Robyn Tomlin and saw beancounters at bottom. More on Tomlin here.

Meanwhile, as late as the most recent election, its op-ed stances continued to dig in determinedly into the right-hand batter's box only, despite all of Dallas County clearly tilting blue now, and the first ring of suburbs in Collin getting at least a tint of purple.

And, the Snooze has less and less room for further error.

Having outsourced its pagination to Gatehouse 18 months ago, there are no copy editor jobs to cut.

If selling the old Belo building, per the story about the layoffs, was predicated on Amazon HQ2 coming to Dallas, does that mean it's not attracting other offers? Sounds like it. (Jim Schutze has now given some kind of confirmation to this idea, that the Snooze was indeed hoping to roll the Belo Building over to Bezos.)

There are no papers left in Belo besides the Snooze itself and other Dallas properties. (Some in Dallas died in failed experiments almost as bad as paywall cluelessness. And the Denton Record-Chronicle disentangled itself from the Snooze last year.)

A third stab at a paywall may, or may not, be successful. The reporter says the paper is still losing circ as well as ad revenue, which means that online subscriptions, if they are moving upward, aren't having a huge effect, at least not yet.

And, the story itself is a bit dishonest, saying the cuts are 4 percent of the Snooze's Belo parent's workforce. They're far more than 4 percent of the people at the Snooze.

As for re-invention? The Snooze has been doing that for almost a decade.

==

That said, this is the worst ... that I know of.

I first saw Matt's link by a quote-tweet of a quote-tweet:

Gross. https://t.co/7nXumirNjQ

— Mike Hixenbaugh (@Mike_Hixenbaugh) January 7, 2019

Hixenbaugh works at the Chronicle, which has had its share of controversial layoffs, even as it claims to still be making money, and even as it's owned by Hearst, which being privately traded, doesn't have to tell the SEC what sort of bonuses its execs get and why.

Plenty of newspaper jobs — in India

And, they’re hiring many an American, not just Indian nationals and expats.

And, it’s freelancers moving there, too, not just Americans, and expat Indians, working for Indian papers and mags.