Gannett, the Burlington Free Press’ parent company is spinning off all of its 81 daily newspapers. They will be spun into a freestanding publishing entity separate from a new digital and broadcasting television branch. From Gannett’s press release:
“The bold actions we are announcing today are significant next steps in our ongoing initiatives to increase shareholder value by building scale, increasing cash flow, sharpening management focus, and strengthening all of our businesses to compete effectively in today's increasingly digital landscape,” said Gracia Martore, Gannett's CEO, in a statement.
No surprise that shareholder value and increasing cash flow are front and center in the corporate word salad. The “bold actions” will create two entities, and leave shareholders cheering. And although the Gannett publishing business will be “virtually debt free” it is likely newspapers will still be floundering.
Newspapers' online pay-wall revenue is reportedly not making up for years long declines in print ad revenue.
“This is another death knell for newspapers,” Ken Wisnefski, founder of the Internet marketing firm WebiMax.
Although Gannett’s publishing wing will start debt-free, some see darkness not light as the next significant step for newspapers.
While legacy newspapers like the Free Press continue their decline or eh… I mean “sharpen their management focus” Vermont may be doing better than other states. In terms of statehouse coverage, non-traditional reporting methods are picking up the slack. The Pew Research Journalism Project reported that non-traditional (mostly digital) reporters are now the majority covering the statehouse in Vermont and six other states: Connecticut, Michigan, New York, Ohio, Tennessee, Texas.
So, the shareholders may ultimately be pleased but the spin-off was probably greeted with a great gnashing of teeth by print journalists, adding to the world of worry at the Free Press and at least 80 other legacy newspapers around the country.