Project for Excellence in Journalism | The Wall Street Journal
The last 18 months have been “a period of intense change in U.S. newspaper ownership,” reports PEJ in the summary for its report “Who Owns the News Media.” Companies like Media General and Freedom Communications have ended decades of newspaper ownership (or nearly so; Media General has one paper left) as new players like private investment firms have expanded their holdings. “A total of 71 daily newspapers were sold as part of 11 different transactions during 2011,” PEJ says of those sales and the ones so far this year:
Most of the sale prices in these transactions speak to continued softening of the newspaper market. The New York Times Company Regional Group papers were sold for a total of $143 million. Berkshire Hathaway paid a combined $142 million for the Media General properties, which includes 63 weekly and daily papers.
One exception was the San Diego Union-Tribune. Hotelier Doug Manchester acknowledged paying significantly more than $100 million for it. That is at least twice as much as Platinum reportedly paid, under $50 million, for the paper in 2009.
Despite lower prices overall, The Wall Street Journal’s David Benoit reports, The New York Times Co., McClatchy and Gannett, “three of the biggest newspaper companies, all trade at premiums to the value they would hold if they were liquidated.” That’s because “some local newspapers that face less competition have held up and some big publishers have managed to improve returns with online changes.”
John Cribb, who brokers newspaper sales, said in March that small and midsized papers remain attractive to investors because they still dominate newsgathering in their markets: “I think the consensus is that the problems the mid- and small-newspaper industry has right now is 80 percent bad economy and 20 percent digital information issues.”
A couple noteworthy points in PEJ’s report:
- TV revenue fell the most in largest markets. “The 176 stations in the top 25 markets averaged a 24% decline in revenues in 2011 ($48.5 million dollars). That compares to a 9% loss in midsize markets (26-50), 8% loss in markets 51-100, 12% in markets 101-150 and 9% in the 44 stations in the smallest markets (151+).”
- Newsweek-Daily Beast merger in August hasn’t helped Web traffic. “When the deal closed, The Daily Beast’s audience was 2.2 million, while Newsweek drew 3.1 million unique monthly visitors, according to Compete.com. Combined traffic for the two sites for the five months following the August 2011 merger averaged 2.5 million; in January 2012, that inched up to 2.9 million.”
Media General announced Monday that it had completed the sale of its 63 papers to Berkshire Hathaway’s World Media Enterprises. When Berkshire Hathaway completes all of the sales it has announced recently, Warren Buffett will own 89 papers.
Now Media General owns just one paper, the Tampa Tribune; the company said it’s talking with prospective buyers for the Tampa Tribune and its “associated websites.” (The Tribune competes with the Poynter-owned Tampa Bay Times.)
Winston-Salem Journal Publisher Jeffrey Green describes Buffett as a “white knight,” but adds that the company still must make money for its new owner. One bright spot:
Our revenue losses are tapering off and are coming from large national/retail accounts we can’t really control. Our local advertising from greater Winston-Salem businesses is up in print and exploding in digital.