One billion dollars in acquisitions in a three-year period seemed like a lofty goal when New Media Investment Group CEO Mike Reed made the proclamation earlier this year, but it appears the company will hit its mark.
In just the past year, the GateHouse Media parent has shelled out approximately $476 million for Stephens Media LLC and its flagship Las Vegas Review-Journal, Halifax Media, the Providence (R.I.) Journal and, most recently, The Columbus (Ohio) Dispatch and its Dispatch Printing Co. It’s funded the deals through a mix of new debt, stock sales and operating cash flow.
Buying The Dispatch may prove to be its best move yet. Aside from its market position and size, the paper solidified its future three years ago when it became the first in the world to commit to a three-around printing platform. The move transformed the daily into a fully sectioned compact broadsheet, shaving some 33 percent off of its newsprint bill and landing it a contract with Gannett Co. Inc. to print The Cincinnati Inquirer and Kentucky Enquirer. All of that considered, the purchase price of $47 million certainly appears to be a steal.
In this era where we talk endlessly about digital and mobile growth GateHouse, has positioned itself for success by snapping up papers with little market competition, whose digital profits have nowhere to go but up and whose print products are still strong.
What remains to be seen, however, is whether or not GateHouse will change its pattern of handing down layoffs at the papers it buys. The company continues to make major cuts in copy-editing and design across titles since it shifted those functions to its Center for News and Design in Austin in 2013. Despite all of GateHouse’s recent successes, disregarding the core business of newspapers — journalism — won’t foster any real success long term.
Be sure to check out our page-6 story for more on GateHouse’s recent purchases and an in-depth look at the changing face of newspaper ownership.
This issue also takes a look at how newspapers’ paywall initiatives have evolved since N&T first began covering digital subscriptions nearly a decade ago. It was fascinating to take a look back at newspapers early strategies, the lessons they’ve learned and what’s working now.