What's worse than being put on the auction block in the first place? How about being told you don't make the grade, and you're going to resold to pay the bills.That's the situation the folks at the San Jose Mercury News found themselves in today. After perhaps feeling some initial relief that McClatchy, the well-regarded owner of the Sacramento Bee and 11 other U.S. dailies, had submitted the winning $6.5 billion bid for the Knight-Ridder newspaper chain, they found out that their new owner plans to reduce his debt load by selling off some of the less promising papers in the K-R chain...and that his list of losers includes the Mercury News.
That leaves them still hanging fire, and more likely to end up with an owner who will "slash and burn" the newsroom in an attempt to cut costs and pull more profits out of the paper.
In a briefing last week to JMC faculty on the impending sale of the K-R chain, Editor-in-Residence Jerry Ceppos voiced some of those kinds of concerns and listed what he considered to be the three most likely outcomes for San Jose and the Mercury News. He didn't envision this one.
But Ceppos did offer one suggestion that now seems prescient. No matter who buys K-R, he said, we should watch for two things: whether journalists end up near the seat of power, and how much debt the buyer must take on to complete the buyout. That's what will determine whether or not the K-R buyout turns out to be good for journalism, he said.
From that perspective, things aren't looking so good for San Jose and the Mercury News.
In an article in today's WSJ, K-R Chairman and CEO Tony Ridder acknowledges that the "uncertainty is not over" for the 12 K-R newspapers that will be resold, "and I regret that very much."
In the same article, McClatchy CEO Gary Pruitt said he did not anticipate having trouble selling those K-R newspapers, and that the proceeds would be used to pay down debt.
3 comments:
Though journalism provides a certain voice for its readers, it is still a business. And as a business cutting costs by selling companies that do not perform up to standards is a good move.
Jerry Ceppos says that a goodf outcome for the newspaper should have a journalist at the seat of power. This is true. I would hate to see a newspaper's goals change from displaying great news, to do whatever to sell papers. That might create a situation where the news is less informative and more humorous.
But in the end San Jose is to big of a city to not have a good newspaper, with all the stories the city creates, uncertainty will not be for long.
-Ekene-
The news industry is a business that depends on stability and growth to survive. As for the former Knight Ridder company, it was in a debt and not succeeding in its profits to maintain its strengths to survive. Sure its a probability that San Jose may lose its local paper, but giving up the Mercury isn't as bad as seeing Knight Ridder crumble to the ground.
-William-
I agree with the others in that it is just a business and the Mercury was not a good one at that. If it was failing the grade then what do you expect. Like all other businesses that fail, they are either taken over by a bigger business and cut down to make profits or they just go out of business. With San Jose and Silicon Valley being the technology centers of the world, it is easy to see why a newspaper would struggle. I personally do not read the Mercury nor am I a fan of the paper. They never give the Oakland Raiders enough respect in the paper and that is why I dislike it. While I am sad to see the paper be sold I really don't care.
-Joel-
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