Masslaw-ownership

(Notes by Bill Densmore)

COLBY: The panel included: Jerry Colby, president of the National Writers Union; Ben Compaine consultant and Northeastern University professor of entrepreneurship; and Rick Edmonds, media business analyst for the Poynter Institute.

"The decline of family publishing is not separate really from the growth of corporate publishing." The aversion to risk should not be a surprise to anybody. "If the editors fight too much for you, they are replaced. After awhile it is not necessary for the publisher to get into a direct conflict with you." "So we no longer have estock barons hiding behind hedges, today we have them hiding beyond blocks of stock."

Edmonds has a bunch of points to make:

There are four different kinds of ownership:

-- Family in the town. That group has shrunk.

-- Substantial privately run chains: Hearst, Cox, Media News Group, Advance Publications. "They are a good-sized segment of the industry."

-- True public companies: Tribune, Knight Ridder and Gannett. NOw the only big one is Gannett.

-- Quite a number of publicly traded companies where the family has significant control -- Washington Post, New York Times.

Edmonds agrees with the notion that there used to be a lot of public spirited owners and there are fewer now. "But the family ownership model is at best a checkered one." In Jacksonville, Fla., where the railroad company owned the paper, for example, there were never any railroad accidents. In Philadelphia, Ambassador Anneberg had a list of people who's names could not appear in the paper -- including the president of the University of Pennsylvania.

So while the broad movement of big companies getting involved, "that model itself has begun to come apart in a fairly dramatic fashion." Examples include the breakup of Knight Ridder. "With mixed results, it is probably a bit too early to tell."

Newspapers lost 42% of their stock value in 2006-2007 and then lost 83% of their value in 2008. "We have ony one public traded newspaper company at higher than five dollars a share right now." That's the Washington Post because of Kaplan Education. "It's not an exaggeration to say the market has marked the value of newspapers down to zero."

Compaine: A pancake has two sides

Ben Campaigne talks about every pancake having two sides to describe the pros and cons of family ownership. Corporate folks don't care about an ideological agenda, other than making money. In Honolulu, Gannett rehabbed the newspaper when they purchased it because they saw it as underperforming and the investment was needed to get it to an appropriate profit level.

Why did families sell out?

• Sometimes the had weak management.
• Family squabbles.
• Inadequate financial resources.
• Estate taxes

"The bottom line is that family ownership as an ideal is overblown," says Campaine. "Most of the bad ones disappeared -- either they didn't survive financially or they have been acquired . . . what we are left with are the families . . . that tend to be viewed as positive."

Q-and-A: The capital structure

During a Q-and-A period, Bill Densmore (the writer of this post!) observes the key challenge for many newspapers today is their capital structure -- too much debt. It's important that as a generation of web-based news organizations spring up -- he cites Margaret Freivogel in St. Louis -- it's important to find ways to help them find a capitalize them in a way "that doesn't force Margie to make the wrong decisions about good journalism."

Robert Giles of the Nieman Foundation observes that the Newhouse family had earned a reputation over decides of enlighted chain ownership.

Compaign also observed that sometimes having a non-local publisher assigned to a community he's not an indigenous part of can result in more independent coverage.

She published an op-ed piece in the Rutland Herald, which is family owned about radiation levels at Vermont Yankee. It's a family owned paper. "The Burlington Free Press wouldn't go near it," she said, citing its ownership by Gannett Co. Inc.

She talks about Henry Demarest Lloyd, and the new new Henry Demarest Lloyd Investigative Fund. She said Robert Rosenthal's Center for Investigative Reporting in California has adopted this fund. "We made sure this kind of reporting would go back to the true value sof Henry Demarest Lloyd, which was to shine a light on the truely powerful and the elite."

A questioner talks about working for 20 years at the Worcester Telegram but is not there now. Will the Guild survive at the Telegram or elsew & Gazette here, he asks?

Jerry Colby of the National Writers Union says its too early to tell.