Gannett and its Wisconsin predecessors

Two weeks ago I wrote here about Gannett’s swallowing up of what used to be Journal Communications, formerly Wisconsin’s largest media company.

Having gobbled up Journal Media Group, Gannett is now looking south, reports the Chicago Tribune:

Gannett announced Monday an offer to buy Tribune Publishing, publisher of the Chicago Tribune and the Los Angeles Times, for $815 million, including the assumption of $390 million in debt.

The unsolicited, all-cash offer, which translates to $12.25 a share, represents a 63 percent premium over Friday’s $7.52 a share closing price, as well as a premium over the $8.50 share price at which Tribune recently issued common shares, Gannett said.

Robert Dickey, president and CEO of Gannett, said in an interview Monday the company has been eyeing Tribune Publishing since June, and that it sees $50 million in savings annually and a platform for expanding its recently launched USA Today Network online. He said Tribune Publishing markets such as Chicago, Los Angeles, Baltimore and Orlando specifically “filled a number of geographic gaps” for Gannett.

Poynter provides a preview:

A hostile $815 million bid for Tribune Publishing by Gannett, owner of USA TODAY and 100 other properties, inspired anxiety in Tribune newsrooms for reasons that Gannett shouldn’t deny. Staffers I spoke with at the Los Angeles Times, Chicago Tribune and The Baltimore Sun — three of Tribune’s best-known dailies — are nervous, partly because of Gannett’s lingering image of being in a different league qualitatively, even with the success of USA TODAY (of which I am a fan). After nearly a decade of internal tumult, including bankruptcy, they’re well-practiced at being shell-shocked. This time, the news reinforced their falling fortunes. Not long ago you would have needed far more money just to buy either the Tribune or Times, forget all 11 papers.

Whether you’re “the best orthopedic surgeon in town” or a “sleazeball lawyer,” reputations are hard to lose. Thus, here was industry analyst Ken Doctor’s Cliff’s Notes on Gannett in a phone chat: “Middle-brow, small towns, tight rein on management, publishers ascendant and editors not as strong, excellent financial engineers, best balance sheet in the business, still searching for its community voice.” And there are few Pulitzer Prizes around their newsrooms.

It is not necessarily true that size means mediocrity, and it is not true that chain ownership of media properties is necessarily a bad thing. It depends on who the owner is. And that requires some state media history.

I became a Journal Communications employee in 1994, as editor of the late great Marketplace Magazine. Journal owned the Milwaukee Journal and Milwaukee Sentinel (which would merge in 1995), the most established AM radio station in the state, the first commercial TV station in the state, and numerous weekly newspapers. Journal was an employee-owned company, heavily invested in Wisconsin and the Milwaukee area specifically (though even then Journal owned out-of-state TV and radio stations), and the preferred employer for us media types.

At the time Gannett owned only the Green Bay Press–Gazette and the Wausau Daily Herald. The big print competitor was Thomson Newspapers, a British company that owned the Appleton, Fond du Lac, Manitowoc, Sheboygan, Marshfield and Wisconsin Rapids newspapers. The Oshkosh and Stevens Point newspapers were independently owned until Thomson purchased the Stevens Point newspaper and, after the Oshkosh newspaper was sold to an out-of-state company, Thomson bought the Oshkosh newspaper one year after its sale.

Gannett already had a reputation for trying to kill its competition, in Green Bay’s case the Green Bay News–Chronicle, a newspaper started by striking Press–Gazette employees in the early 1970s. The News–Chronicle’s owner, Frank Wood, brought in Richard McCord, who had experience with Gannett in New Mexico, for a project to save the Newx–Chronicle, which prompted a book, The Chain Gang: One Newspaper Versus the Gannett Empire. (Long story short: Gannett ended up buying the News–Chronicle and closing it. Wood’s sons, however, are still in print, and own the portion of Journal I used to work for.)

Gannett’s business practices were one thing. How Thomson ran its newspapers was another thing. A friend of mine in Appleton told the story about how, in the early days of his marriage when he and his wife lacked money for entertainment, they would have a nightly contest to find typographical errors in the newspaper, with the loser having to do the dishes that night. To call the rest of Thomson’s newspapers “mediocre” would have been a compliment.

Thomson then came upon what management thought was a great idea. In this country, unless you’ve been in the profession for a long time, journalism requires a four-year degree. In Britain, journalism is considered a trade instead of a profession, requiring the British equivalent of a two-year degree. (Which is interesting given that one of the things journalism students learn is libel law; in Britain libel is a criminal offense, and lacking a First Amendment newspapers are forced to apologize for misreporting.)

Whether Thomson wanted to drag down reporter salaries lower than they already were, or wanted its reporters to do whatever editors wanted to them to do, Thomson decided to create the Reader Inc. Editorial Training Center. According to Editor & Publisher:

Motivated by high editorial staff churn and difficulty landing journalism graduates for the long haul, Thomson Newspapers is launching an in-house journalism school for aspiring reporters with as little as a high school diploma or equivalency.

The plan to spend over $1 million of corporate training funds was propelled by the desire to reverse the trend shared by many newspaper companies — the revolving door of reporters on community beats. Thomson executives say the turnover creates confusion and diminishes credibility in the 58 community papers Thomson operates in North America.

Dubbed the Reader Inc. Editorial Training Center, after Thomson’s Reader Inc. initiative aimed at fostering newspaper readership, the center will ensure “new journalists bring a passion for readers to their work, unencumbered by lofty preconceptions of what journalism is all about,” says Stuart Garner, president and CEO of Stamford, Conn.-based Thomson Newspapers.

The venture, apparently the only U.S. effort of its kind, mirrors features of the Thomson Editorial Training Center in Great Britain, which became Trinity Editorial Training Center after Toronto-based Thomson Corp. sold some U.K. properties in 1994. The school has trained thousands of journalists in the past two decades, says Jim Jennings, vice president and editorial director, Thomson Newspapers, who directed the British program in the 1990s.

“We brought the best of what we had done and added a North American feel,” Jennings says. Thomson plans a program in August 1999, and three programs per year starting in 2000. Recruiting will start in a few months in each newspaper’s own circulation area.

The initiative raises the longstanding argument over whether journalism schools should be trade schools or should provide a broader perspective of how the world operates. Eric Meyer, professor of journalism at the University of Illinois, calls the Thomson training course a dangerous move because journalism shouldn’t be about technical training. “We believe you must know something about the world before you begin reporting about it,” he says. “We want [journalism students] to take political science, meteorology, [and] biology to give them a broad understanding about what the issues really are. … If you don’t do that, you run a serious risk of simply transcribing notes.”

Thomson’s Jennings says Meyer is absolutely right. “Journalists need a broad-based education,” he says. But Jennings doesn’t think academic journalism programs are always the right answer.

Meyer believes the move is only designed to save Thomson money. “They very often look for the least expensive solution,” he says. “If they can hire 100 reporters at $15,000 per year instead of $25,000, they are saving a lot of money.

I was aware of one “graduate” of the Thomson School of “Journalism,” a person who made my life difficult at a later employer by blocking (or so I thought) coverage of my employer in the newspaper he worked for because (we believed) he had been asked to leave my employer. He denied that was the case, but once he left, magically the newspaper started covering my employer much more.

I predicted in Marketplace that Thomson would end up buying out Gannett’s Wisconsin newspapers because it didn’t make sense for Gannett to own just two newspapers in the state. I was correct, though I got the buyer and seller confused. In 2000, Gannett ended up buying all of the Thomson newspapers when Thomson decided to get out of newspapering.

In between my stints at Journal, Journal made the decision to sell its stock privately, in order to grow. That ended up, as you know, with the ultimate death of Journal, when Journal and Scripps “merged,” with Scripps controlling Journal’s former broadcast properties and, one year later, Gannett buying Journal’s remaining print properties. Change is not necessarily positive change.

 

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