The newspaper business has struggled for much of the 21st century as the rise of digital media has penetrated deeply into revenues once generated from print advertising and newspaper kiosk sales. At the same time, Facebook and Google have made a huge chunk of their digital ad revenue, effectively keeping the industry away from one of its traditional sources of money.
About a quarter of newspapers in the United States, most of them weekly, closed between 2004 and 2019, while about 50 percent of newspaper jobs were canceled. However, hedge funds see newspapers as a potential bargain. With a strict management style, which often means downsizing and reporting on local news, they have been able to put this to good use.
In doing so, they often annoyed their employees. Journalists from the Denver Post, a daily newspaper controlled by an Alden media company, mutinied in 2018 by publishing a special opinion-piece section that blew up the hedge fund and compared its executives to “vulture capitalists.” Previously, Alden ordered The Post to cut 30 jobs in a newsroom with up to 100 editorial staff after a significant number of journalists had lost to layoffs and takeovers since the company took control in 2010.
Penny Abernathy, a former New York Times and Wall Street Journal executive who studies local media economics at the University of North Carolina School of Journalism, said Alden’s track record didn’t bode well for tribune publishing newspapers that may be under her control fall.
“Based on the model Alden has been using so far, this is an industry decline with no significant investment in the future of newspapers,” she said. “One of the problems with these big chains is that they are journalistically and economically separate from the communities in which these newspapers operate.”
Some journalists working for Tribune Publishing newspapers – including The Orlando Sentinel and The Hartford Courant – have tried to convince wealthy benefactors to step in before the hedge fund could raise more stocks. Last year, two reporters from the Chicago Tribune sent letters to Chicago Lights asking them to buy the paper.
In an interview on Tuesday, Gregory Pratt, president of the Chicago Tribune Union and a city hall reporter, did not appear confident about the deal. “That’s very bad,” he said. “No good news. Alden is the worst in the news business, and that says something when you consider how many bad actors there are.