The news companies I have worked for have changed hands a lot of times. Often the change was bad news. Yesterday’s acquisition of the Journal Register Co. by Alden Global Capital is great news.
Since emerging from bankruptcy in August 2009, JRC has been owned by a variety of investors, our ownership future uncertain as the company turned around its performance and gained international prominence by aggressively pursuing a digital-first strategy.
The Wall Street Journal reported the deal, saying: “Newspaper acquisitions are a species rarer than a Yangtze River dolphin.” The Journal noted that it could find only one major acquisition of a “newspaper company” since 2007. And the Journal missed the point. If JRC were still a newspaper company, this deal wouldn’t have happened. This deal happened because we are becoming a digital-first company, rather than tying our identity or prosperity to declining print technology.
Yes, we publish newspapers, but we grew digital revenues by 70 percent in the first quarter of this year, seven times the industry average. We haven’t completed our digital-first transformation, but the direction is decisive and dramatic.
With a single owner now, and with CEO John Paton firmly in place leading the company, the digital strategy is securely affirmed. “We stay on our Digital First plan with our team and goals intact but this time with a solid financial partner backing us all the way,” John wrote in his blog, announcing the Alden Global deal.
It wasn’t the first time a company I worked for had been sold. The photo below shows the long faces in the Des Moines Register when Chairman David Kruidenier announced our newspaper’s sale to Gannett in 1985.
The Register then was a statewide newspaper then, the nation’s leading news organization in coverage of agriculture, with an outstanding Washington bureau. Gannett abandoned the Register’s statewide strategy and its position of leadership in agriculture coverage, closed the Washington bureau and cut staff repeatedly. Some of those changes might have happened regardless of who owned the Register, but no one I know in Des Moines thinks the Gannett acquisition was good for the Register or the community.
When I was editor of the Minot Daily News in 1992, the owners of the newspaper were preparing to sell the newspaper. To make the bottom line look better, they jettisoned four top managers (including me) and their large salaries in the months leading up to the sale to Ogden Newspapers. I don’t know anyone in Minot who thinks that sale was good for the newspaper or the community.
The Kansas City Star was not sold while I was there, but since I left, it has been acquired by Disney, Knight-Ridder and McClatchy. Like the Register, the Star has cut staff repeatedly.
An ownership change can be grim news. And any acquisition needs to be judged over time, not just how it looks on Day 1. But yesterday’s deal affirms our digital-first strategy and our company’s leadership, and I see that as outstanding news.