Sunday, July 12, 2020
KANSAS CITY STAR PARENT COMPANY McCLATCHY SOLD TO HEDGE FUND CHATHAM ASSET MANAGEMENT!!! EXPECT MORE 'JOURNALISM' CUTS!!!
Financial news trumps the ongoing political conversation today as we are once again reminded that dead-tree media is going the way of the dodo.
To wit . . .
NEW HEDGE FUND BOSSES FOR THE KANSAS CITY STAR SIGNAL MORE JOB CUTS AT THE EMBATTLED NEWSPAPER!!!
We've seen a few far-too-wordy takes on this financial move that offer fake insight and flowery prose about the future of "journalism" which isn't nearly as important as getting a lot of likes & shares on the app du jour.
Here's the important mindset change that locals should understand . . .
New hedge fund owners will do their best to maximize profit and strip every asset from the newspaper chain in order to benefit shareholders. This isn't good or bad news, it's reality and something demanded of every profitable business.
Meanwhile, we expect a welcomed management purge and newer employees flocking to the paper not because of more opportunity but because rookies work cheap and they're easily replaceable.
A worthwhile comment from a reader whom we respect a great deal:
"A hedge fund owning the city’s daily newspaper is the worst scenario possible. Hedge funds squeeze the blood out of newspapers by slashing staff beyond the unimaginable. No hedge fund owning newspapers has yet demonstrated one iota of care about journalism. Your term “Dead Tree Media” will be a compliment six months from now."
Most people forget that newspapers are a business.
Meanwhile, the term "journalism" is often a distinction offered only to reports that inspire agreement among the political elite.
But here's the rub: So many non-profit efforts to sustain local journalism represent nothing more than ponzi schemes or fundraising gambits that don't have much impact or influence over policy or the local discourse. Partisan reporting and think tank produced talking points have always been part of the American discourse and they've NEVER held much sway because that style of coverage is the opposite of journalism. At the very least, reporters and pundits work to craft objective analysis or at least craft work that's much entertaining than political hacks. Nonprofits are incapable of consistently moving the political dial given the constraints and whims of donors who simply want to pay for the transcription of their agenda that seldom benefits the majority of the public.
Even worse, the social media revolution has taught the world that most people would rather "read" and scroll through social media in order to spy on frenemies, witness phony content from celebrities and enjoy pet vidoes rather than learn and understand more about public policy and local reporting.
Check the links:
The Hill: Hedge fund wins auction for bankrupt McClatchy newspaper chain
Fox Biz: Auction ends 163 years of family ownership for the newspaper chain
Reuters: McClatchy had filed for Chapter 11 bankruptcy protection in February, burdened by heavy debt it took on when it bought newspaper chain Knight Ridder in 2006 and large pension obligations that eat into its profits.
UST: Newspaper chain McClatchy announces Chatham Asset Management is successful bidder in bankruptcy auction
MarketWatch: Hedge fund that owns National Enquirer to buy newspaper publisher McClatchy
Developing . . .