Digital First Takes Knife to Boston Herald Again

The clearcutters at Digital Worst – sorry, First – Media are at it again, engineering a Memorial Day Massacre at Fargo Street, according to Greg Ryan’s report in the Boston Business Journal (tip o’ the pixel to @EBMason).

Digital First lays off Boston Herald managers, workers

Digital First Media, the new owner of the Boston Herald, laid off at least six employees on the commercial side of the newspaper on Friday, according to a union representative.

A marketing manager and automotive sales manager were among those who lost their jobs, as were a receptionist and three employees in the paper’s financial services department, which handles billing and other tasks, said Donna Marks, a Herald employee who took over as president of the Newspaper Guild of Greater Boston earlier this week.

The cuts come in the midst of a steady exodus of Herald staffers who had survived Digital First’s original bloodbath right after it purchased the shaky local tabloid. (See our Hexit Watch™ for a partial list.)

Sad as it may be, what’s happening at the Herald is very much newspaper business as usual according to this piece by Bloomberg’s Gerry Smith.

Several hedge funds have become newspaper barons in recent years. Alden Global now owns about 60 daily newspapers through a subsidiary, Digital First Media. New Media Investment Group, which is managed and controlled by private-equity firm Fortress, owns almost 150 newspapers in smaller towns like Columbus, Ohio, and Providence, Rhode Island, through a unit, GateHouse Media. And hedge fund Chatham Asset Management LLC is one of the largest shareholders and bondholders in McClatchy Co., publisher of the Charlotte Observer and Miami Herald.

Helpful chart:

Smith adds, “’They’re not reinvesting in the business,’ Ken Doctor, a longtime newspaper analyst and president of the website Newsonomics, said about Alden Global. ‘It’s dying and they are going to make every dollar they can on the way down.’”

Two certainties at the Boston Herald: 1) They’ve got company at over 200 other U.S. newspapers, and 2) They all face the same future of death by a thousand paper cuts.

Is the Boston Herald Print Edition Now in Jeopardy?

As the sadreading staff has previously noted, the Denver Post is the Ghost of Printmas Future for the Boston Herald, given that both papers are owned by Digital First Media (slogan: “Where Newspapers Go to Die”).

From media guru Ken Doctor at Nieman Lab (tip o’ the pixel to Brian Stelter’s CNN Reliable Sources).

It might only seem that the walls are tumbling in at The Denver Post. Or it might be reality.

In a stunningly quick series of events, the Post has continued to shed staff — not by firing or layoff, but by what might best be described as resigned resignation. At the same time, I’ve learned, a fresh round of budget cuts in the range of 10 to 15 percent is being planned for the paper, along with other Digital First Media properties.

Doctor says that Digital First’s parent company, the New York-based hedge fund Alden  Global Capital, is itself facing financial pressures, which “have led Alden to plan still another coming round of budget cuts at its properties.”

Bottom line: “As Alden demands to continue its level of profit-taking amid a 10-percent-plus drop in advertising revenue, its executives have mandated new cuts for the company’s new fiscal year, which starts July 1.”

Heads up to the shaky local tabloid:

Those cuts look to be in the 10 to 15 percent range, sources tell me, though it’s unclear the degree that newsrooms would be subject to the new cuts, given that they have already absorbed major cutbacks since the start of 2018. In fact, the Post and other DFM dailies may soon have issues simply getting a print paper out seven days a week.

Given that the Herald has roughly 17 home subscribers (in Brookline that would be us and Mike Dukakis) and lives off its newsstand sales, that’s very bad news indeed.

No print edition of the Boston Herald?

No Boston Herald.

(Sad fact to know and tell: Once you shut down your print edition, you have to lay off 80% of your newsroom. That would reduce the skinny local tabloid’s reporting staff to one very overworked journalist. Send condolences and Red Bull to Fargo Street.)

Boston Herald Editorial Page To Be Silenced?

When we last left Digital First Mishegas – sorry, Media – last month, the Denver Post editorial board was begging the newspaper group’s owner, New York hedge fund Alden Global Capital, to sell the Post.

Denver deserves a newspaper owner who supports its newsroom. If Alden isn’t willing to do good journalism here, it should sell The Post to owners who will.

The proximate cause of that plea was a looming 30% cut in the Post’s newsroom – a mystery, the editorial said, “as many [Digital First] newspapers still enjoy double-digit profits and our management reported solid profits as recently as last year.”

How solid?

Rock solid, as media guru Ken Doctor just detailed for Nieman Lab: “DFM reported a 17 percent operating margin — well above those of its peers — in its 2017 fiscal year, along with profits of almost $160 million. That’s the fruit of the repeated cutbacks that have left its own shrinking newsrooms in a state of rebellion.”

This week Denver Post editorial page editor Chuck Plunkett wrote another piece blowtorching Alden, but that one was rejected, which triggered Plunkett’s resignation.

“I was being boxed in so that I couldn’t speak,” Plunkett told CNN’s Brian Stelter. “How can I be silent at this point?”

Ironically, Plunkett may have silenced every editorial voice at Digital First’s newspapers.

[Plunkett] also said “there is active consideration of doing away with the editorial pages throughout the company.” He means “at all the papers” owned by Digital First Media . . .

That would include the Boston Herald, which coincidentally has just gotten its editorial page sorted out.

As CommonWealth Magazine’s Michael Jonas recently chronicled, after Digital First’s purchase of the Herald, it had no editorial page editor. But then it did.

Tom Shattuck, a former talk radio producer who has run the paper’s online radio station and written op-ed columns, will replace Rachelle Cohen, the paper’s longtime editorial page editor who left last month when Digital First Media took ownership of the Herald.

Except soon, according to Plunkett, he might not.

Put aside any opinions about Shattuck himself, whom Jonas calls “an unwavering cheerleader for President Trump, a sharp departure from the editorial page under Cohen.”

Representative sample: The editorial in today’s smoochy local tabloid under the headline Media distortion hits new lows. Clunky-as-hell lede: “Another week has gone by in which the media covering the president of the United States has committed reckless malpractice more disgraceful than usual.”

People might say no great loss if that voice goes away. Beyond that, there’s exactly zero chance that the shaky local tabloid will ever go scorched-earth on Digital First.

Even so, no editorial voice at the Herald?

That would be just wrong.

Denver Post Is Boston Herald’s Coal-Mine Canary

As the sadreading staff has noted, hedge fund baby Digital First Media (slogan: “Where Newspapers Go to Die”) is dismantling the Denver Post in slow motion.

Now comes the latest installment, via Oliver Darcy at CNN’s Reliable Sources.

The Denver Post sends an SOS

The Denver Post is begging to be saved — quite literally. On Sunday, the newspaper will print a package (here’s a landing page with the different pieces) centered around its survival. At the center will be a piece by the newspaper’s editorial board lamenting “marching orders to cut a full 30” staffers by the start of July, and laying much of the blame at the feet of its owner, NYC hedge fund Alden Global Capital.

It’s a remarkable piece, one in which The Post’s editorial board goes as far as to say, “If Alden isn’t willing to do good journalism here, it should sell The Post to owners who will.” The board also laces into Alden’s “cynical strategy of constantly reducing the amount and quality of its offerings, while steadily increasing its subscription rates,” and says, “Coloradans feel the insanity of it in their bones.” Read the editorial in its entirety here...

The CNN piece closes with this:  “Alden’s gutting of local papers is coming under increasing scrutiny…

That would refer to this Bloomberg News piece.

Fasten your seat belts, you remaining Heraldniks.

As Bette Davis might say, it’s going to be a bumpy night(mare).

‘Digital Worst Media’ a Herald of Bad News

New slogan for the Boston Herald: Cave emptoris.

Beware of the buyer.

The shaky local tabloid’s future must be flashing before its eyes thanks to the slow-motion dismantling of the Denver Post by owner Digital First Media, which is in the closing days of its Herald purchase.

From the Post’s own story:

Thirty jobs will be cut from the newsroom of The Denver Post in the coming months, Editor Lee Ann Colacioppo told her staff on Wednesday.

“These job losses are painful, and we know meaningful work will not get done because talented journalists have left the organization,” she said in a memo sent following a newsroom meeting. “I’m sure some commenters will cheer what they believe is the eventual demise of the mainstream media, but there is nothing to celebrate when a city has fewer journalists working in it.”

The Post newsroom currently has about 100 journalists . . .

Do we detect a note of bitterness there? Well, that’s nothing compared to how pissed off they are at News Matters, “a news guild project for Digital First Media workers.”

Denver Post newsroom slashed by 1/3 as hedge fund continues eviscerating Digital First Media papers

“A legal looting of the public trust.”

Nearly a third of the Denver Post’s newsroom will be laid off, management told staff Wednesday as the paper’s hedge fund owners continue slashing jobs to maintain high profit levels.

“The Denver Post had its heart ripped out Wednesday when the company announced layoffs of 30 Newsroom employees – 25 workers and five managers,” the Denver Newspaper Guild said in a statement.

“The layoffs are driven by owner Alden Global’s greed and its desperate attempt to recoup more than $130 million in investment losses from the Fred’s Pharmacy fiasco,” the statement said.

For more on Alden Global’s lack of investment proficiency, see here. Pete Vernon at Columbia Journalism Review’s The Media Today has more on the hedge fund’s “pattern of gutting newsrooms and selling off valuable office space to squeeze profit from the industry.”

From the looks of it, anyone searching for office space on Fargo Street should call Digital First first.

Digital First’s Boston Herald Rx: Apply Internally

When last we met, the sadreading staff noted two ominous takes on the future of the Boston Herald under the new ownership of Digital First Media.

First, the Boston Globe’s Jon Chesto and Andy Rosen made this prediction: “[I]ndustry experts and former employees said that if [Digital First] sticks to the playbook it uses at many of its other newspapers around the country, the Herald should brace for more cost-cutting beyond the 60 or so positions that are expected to be eliminated when the sale closes later this spring.”

On the Globe’s op-ed page, Nieman Journalism Lab director Joshua Benton was even more bleak, citing the dismal track record of Digital First’s parent company, Alden Global Capital.

Alden’s methods fall under the rubric of what some call vulture capitalism: Buy up papers, sell off whatever assets you can (like their offices downtown), and cut costs to the bone. The end game is to be sold off, or just shut down. To be owned by Digital First is to be gutted.

Ouch.

Especially considering this full-page ad in today’s edition of the shaky local tabloid.

Despite its best efforts, that ad looks an awful lot like ave atque vale. Because who knows how many of those “wonderful people” will be around a month from now.

From Greg Ryan at the Boston Business Journal:

Herald’s new owner to begin making job offers next week

The soon-to-be owner of the Boston Herald will start making job offers to current Herald employees next week, according to a letter sent to workers on Thursday, with the newspaper’s staff expected to be cut by more than 25 percent from its levels at the end of 2017.

Denver-based Digital First Media won a bankruptcy auction on Feb. 13 to acquire the Herald’s parent company from Pat Purcell for just under $12 million, beating out GateHouse Media and Florida private equity firm Revolution Capital Group.

Digital First has committed to offering jobs to 175 current Herald staffers . . .  Employees have been interviewing to keep their jobs since last week.

But here’s the kicker: “At this point, it is not known whether those employees who are hired will receive their current salary.” Never mind sick time, vacation time, and healthcare plans, all of which are still undetermined.

And pensions? From all the evidence, that’s another ave atque vale.

Double ouch.