p2p news / p2pnet: ” ‘That is a vote of no-confidence among the private equity groups,’ he said. ‘They could care less if they manufacture ball bearings or print newspapers, as long as the cash flows are there’.”
The quote could easily apply to the entertainment industry which owns most of America’s principal print and electronic media. But instead, it’s literally the bottom line in a Boston Globe story on the McClatchy Co’s buy of Knight Ridder for $4.5 billion, "ending one of the last family dynasties in a newspaper industry that is being turned upside down by the Internet and America’s changing reading habits".
Online citizen reporters, news sites and blogs are inexorably usurping the mainstream media, many significant components of which are increasingly being shown up as biased, one-sided and unreliable, and whose professional standards are falling perceptibly.
"Although advocates for strong newsrooms fret over ownership consolidations, there may be a positive outcome for readers in this case, because McClatchy has a better reputation for quality journalism than Knight Ridder has in recent years," the Boston Globe has Bryce Nelson, a professor at the University of Southern California Annenberg School of Journalism, saying.
McClatchy also is, "chasing a bigger share of the nation’s exploding online audience, which newspaper executives view as both their bane and potential salvation".
The buy brings with it the 110 Real Cities Net sites which had 29 million site visits in January 2006, and a one-third stake in CareerBuilder.com, a web-based employment classified venture with the Gannett and Tribune companies, the story goes on.
And, "While the sale will create the nation’s second largest newspaper chain, it won’t be built on the kind of competitive, big-city journalism with foreign and national bureaus that distinguished the big chains of the past, but rather on a brand of local news where McClatchy sees its niche," it states. "The company said it can make money in smaller markets where it can maintain a position as the dominant news and advertising source."
McClatchy will quickly sell a dozen Knight Ridder papers, including the Philadelphia Inquirer and San Jose Mercury News, "and a handful of unionized papers in rust-belt cities," so it can concentrate on the Miami Herald, the Kansas City Star, the Fort Worth Star-Telegram, and 20 smaller Knight Ridder papers it says are market leaders in growing cities.
Meanwhile, Denver’s MediaNews Group is emerging as a leading contender to "snap up" some of the papers mcClatchy doesn’t want, says the Los Angeles Times.
":MediaNews Chief Executive William Dean Singleton has toured the Mercury News, the Philadelphia Inquirer and other Knight Ridder papers that McClatchy wants to sell, and he is expected to bid for many or even all of them, according to people familiar with the auction process," says the story.
"Singleton’s company owns a controlling stake in more than 30 California publications in addition to the Daily News, including the Long Beach Press-Telegram, the Pasadena Star-News and the Oakland Tribune. Singleton typically buys small or struggling papers and has a reputation for cutting expenses rather than investing in news gathering, said Ben Bagdikian, former dean of the journalism graduate school at UC Berkeley."