Digital First Media will shut down its news hub in New York and may soon sell its newspapers. Local editors will have a phone call with management Wednesday morning at 11:30, and an all-hands meeting is scheduled for staffers at 12:30 p.m. in New York.
Dean Starkman reported Tuesday night that DFM plans to cashier its Project Thunderdome, a national newsroom for the company’s many newspapers, and lay off about 100 employees, including “higher-level executives.”
Ken Doctor writes that Alden Global Capital, the hedge fund that owns most of DFM, is “readying its newspaper properties for sale.”
They’re not yet on the market, but expect regional auctions of DFM properties (with clusters around the Los Angeles area, the Bay Area, New England, Philadelphia, and Texas) — unless Alden can find a single buyer, which is unlikely.
A “person familiar with the matter” told Starkman “the cuts are part of an ongoing strategy to take out about $60 million annually in expenses of about $1.15 billion in total costs, while reinvesting in its digital business, investments eventually expected to add $100 million a year to company expenses.”
A DFM spokesperson has not yet replied to Poynter’s request for comment.
DFM Digital Transformation Editor Steve Buttry is expected to leave the company, a source tells Poynter. Buttry was directing DFM’s Project Unbolt, which “aims to address the problem of digital efforts at the mercy of existing newspaper infrastructure,” Sam Kirkland wrote in January.
In The Washington Post, Paul Farhi writes the cuts are “a setback for DFM, whose chief executive, John Paton, has been a leading proponent of transforming print-centric newsrooms for the digital era.”
Last summer Paton gave a speech called “How Bad CEOs and Worse Editors Are Using the Past to Kill Our Future.” In it, he announced DFM had an operating profit and said, “if you don’t see the kinds of tough decisions to cut expenses in what is not growing –print – and increased spending in what is growing – digital – then get out because your company is surely dying.” Read more