Society of Professional Journalists, Northern California chapter
www.spj.org/norcal
See also:
The accompanying joint national-local press release
from SPJ
WHERE TO GO FROM HERE: Some initiatives worthy of
discussion
Thursday, Jan. 26, 2006
Things are moving fast on the proposed sale of Knight Ridder, the nation's second-largest newspaper company.
Several other media firms, including MediaNews, McClatchy and Gannett, have reportedly been in talks with Knight Ridder management, as have private equity firms. MediaNews and McClatchy are unlikely to be able to afford the purchase without teaming up with outside capital.
On Wednesday, the San Jose Mercury News, a Knight Ridder paper, reported that senior management of the chain have told bidders the company can become even more profitable than it already is (profit estimates for the last year run in the range of 19 percent) if the new owners slash staff and benefits. "According to the projections, a buyer could increase Knight Ridder's earnings by about 20 percent over 2004 earnings in the next 18 months by cutting jobs and benefits, streamlining operations and reducing the size of some of its 32 newspapers," the paper reported.
While it is beneficial to cover the business aspects of this planned transaction thoroughly, as many journalists have done, missing in most of the coverage so far has been a frank discussion of the societal implications of either breaking up the company or selling it whole to a buyer that plans to sacrifice community coverage for short-term profit gains.
The Northern California chapter also has concerns about the sale because it would likely lead to a dramatic further corporate consolidation of the newspaper industry. Such a move would come on the backs of communities that currently enjoy competitive journalism. Allowing neighboring newspapers to merge newsrooms would end such competition.
Regional monopolies may increase the efficiency of reporting and selling ads, but they also greatly reduce the incentive for newspapers to provide better local coverage because there is nowhere else for readers to turn.
In several communities, one company could own most of the major newspapers across a region if Knight Ridder were sold to a competing chain. In the San Francisco Bay Area, for example, if Dean Singleton's MediaNews Group were to purchase Knight Ridder, he would add the San Jose Mercury News and Contra Costa Times -- the region's second- and third-largest papers -- to his existing archipelago of Bay Area titles, including the Oakland Tribune and 10 smaller papers. That would give MediaNews control of most of the daily newspaper circulation in the Bay Area not already controlled by the chain-owned San Francisco Chronicle.
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