US Newspaper consolidation pushes on
US newspapers continue to consolidate, The industry may be hurting in general, but the solution is to get bigger. Two recent events confirm this trend.
Lee Enterprises announced it would buy the Pulitzer newspaper chain for $1.5 billion dollars. Pulitzer, a chain started in the 1870s and famous as the source of both yellow journalism and the Pulitzer prize, owns the St. Louis Post Dispatch and the Arizona Daily Star newspapers. It also publishes over 65 weekly and biweekly community newspapers.
Lee Enterprises owns 45 daily newspapers and 200 weekly newspapers, mostly in the Midwest and West. Though most of the papers have small circulations, the group is quite profitable. Small town and suburban newspapers are generally doing better than big city ones. The deal makes Lee the #7 newspaper company in the US.
Elsewhere, a Wall Street Journal article ("Newspapers Face Antitrust Scrutiny", 1/24/05) traces the trend of big city newspapers buying suburban papers in the same region as their flagship papers. The New York Times Corporation, which owns the Boston Globe, is planning to take a 49% share in Metro Boston, a competing free daily. Gannett Company, which owns dailies in Detroit and Cincinnati, has announced it wall buy out Home Town Communications, which owns a set of 58 suburban papers, many of which compete against the two dailies in suburban markets.
Local opposition from advertisers and rivals have prompted the Justice Department's Antitrust Division to go look at the purchases, which give undue competitive advantages to the big chains,
This all is a big concern. Big newspapers that control their markets have frequently raised advertising rates as there is little affordable alternative to them. But generally there have been limits placed by the growth of community and suburban papers that are more attractive for some advertisers and which generally have lower rates.
5:34:25 PM 
|
|
