Having followed Gannett for 15 years as it has been the lead horse of the newspaper industry, I have two quick thoughts on the impending retirement of CEO Robert Dickey in May 2019.
Dickey’s four-year tenure breaks into distinct parts. As Gannett emerged as an independent company in June 2015, spinning off from its more profitable broadcast division, Dickey promised to make its huge footprint that much bigger.
Acquisitions of the E.W. Scripps and Journal Media Group papers followed. The Record of Bergen County (New Jersey) was later folded in. Then starting in April 2016 and for the next seven months, the main event for Gannett was an attempt to snag a much bigger fish: Tribune Publishing (or Tronc, if you will).
Dealings with Tronc’s mercurial chairman and chief shareholder Michael Ferro grew antagonistic quickly. It was not clear whether Ferro was just bidding up the price or actually changing his mind at regular intervals. Ultimately Gannett, with a nudge from its bankers who had soured on the deal, walked away.
From then on, Gannett seemed to drop its pursuit of more newspapers. Prices too high? Prospects too limited? Instead, Dickey and his executive team spent to acquire, then expand, Reach Local, a digital marketing effort on steroids. With some add-ons, that line of business has recorded healthy growing revenues as print advertising (and now print circulation) revenues fade.
I am not one for speculating whether a given retirement or resignation is voluntary or forced. Dickey, 61, is somewhat younger than traditional retirement age. Also, the USA Today write-up of his decision said it “was made in consultation with the board.”
But Dickey, a 40-year veteran of the company, was not blowing smoke to say his work was mostly done, and that this is a good time to give a next generation of leadership a turn. Absorbing the acquired other papers (there are now 109 in all) took time but has gone smoothly; so has getting in place Reach Local, which was blocked from serving Gannett’s own papers for a more than a year until other contracts expired.
Dickey was an early champion of making the USA Today community papers into a national news network. That came to fruition on his watch under the leadership of editors Dave Callaway, Joanne Lipman and Nicole Carroll.
USA Today won its first Pulitzer this April for pooled coverage of “The Wall” along the four-state border with Mexico.
Financially, Gannett has lost its lead position in market valuation to the New York Times Company. Its share price has not done especially well over the last year. But it avoided the debt distress of McClatchy or the management disorder of Tribune Publishing, its peer public companies.
Tight budgets for 2019 are being finalized this month, and new rounds of cuts in newsrooms and elsewhere are in progress.
So who’s next in the Gannett CEO chair and what’s next for the company?
In theory, the Gannett board could go outside the company for a successor, but to date that has never happened. Since the redoubtable Al Neuharth kicked himself upstairs to chairman in 1986, five successive CEOs have all advanced internally.
Both of the obvious inside candidates are women — Maribel Perez Wadsworth and Sharon Rowlands. Wadsworth, a former journalist, has risen through the ranks to president of the USA Today Network. Business services executive Rowlands came as CEO with Reach Local in 2014, and her star has been rising as that part of the company gets the lion’s share of internal investment for expansion.
Neither would be Gannett’s first woman CEO. That was finance/investor specialist Gracia Martore, who moved over to broadcasting arm TEGNA at the time of the split in 2015. However Perez Wadsworth is Hispanic, and she would be the first in Gannett’s top job.
Dickey exits with the company’s version of digital transformation “ongoing,” in the words of the USA Today story. But Dickey also observed that print advertising continues to provide close to half the company’s revenues and needs to be kept as strong as possible to fund further digital transformation.
His successor will need to figure how to balance the two halves — and most likely, develop revenue streams C and D before long.