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Thursday, March 31st, 2016

Newspapers Gobble Each Other Up to Survive Digital Apocalypse

Author:     Gerry Smith
Source:     Bloomberg Technology
Publication Date:     March 29, 2016 — 2:00 AM PDT
 Link: Newspapers Gobble Each Other Up to Survive Digital Apocalypse
Stephan:   Six companies control 90% of the media in the United States. They operate with only one consideration, maximum profit. The traditional function of media in democracy from Benjamin Franklin until the 1980s, to be the Fourth Estate, the investigator for and chronicler of the people is of interest only if it increases profits. If you were designing a media to support democracy would it be devoting most of its coverage to Donald Trump? Here is the latest on media consolidation. Like the banks these media mega-corporations must be broken if an educated democracy in the U.S. is to survive.

Press merge chartNewspapers have settled on a strategy to stop withering away: feast on each other for survival.

For the owners of big-city dailies like the Chicago Tribune and Denver Post, buying smaller publications and slashing costs has become a way to buy time while figuring out how to make more money online. That was the logic behind the recent failed attempt by Tribune Publishing Co., owner of the Los Angeles Times, to buy two Southern California newspapers.

Last year, the industry saw the most deals for the largest amount of money since the 2008 financial crisis, with 70 daily newspapers being sold for a combined $827 million, according to mergers-and-acquisitions adviser Dirks, Van Essen & Murray. Gannett Co. bought 15 dailies, including the Milwaukee Journal Sentinel; Tribune snapped up the San Diego Union-Tribune; and Warren Buffett’s newspaper chain acquired the Free Lance–Star in Fredericksburg, Virginia.

Even after last year’s surge of activity, more deals may be coming. The pressure to combine is only expected to grow because several media companies have spun off their lucrative TV stations, leaving newspapers to fend for themselves. […]

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