The media landscape is a turbulent one these days, with unexpected purchases and mergers happening (or rumored to be happening) on a regular basis. So it’s not a surprise that a number of professionals working for newspapers have opted to take a more direct involvement in their workplaces’ future.
In a new article for The New York Times, Marc Tracy describes Chicago Tribune reporter Gary Marx in the midst of an unexpected errand: delivering a letter to an affluent resident of Chicago, urging them to purchase the Tribune.
What prompted this? The purchase of a significant stake in The Chicago Tribune by Alden Global Partners. “Journalists are wary of Alden because of its cut-to-the-bone management strategy,” writes Tracy — and it’s something that’s left many journalists and media observers alike concerned.
A 2019 article in the Times, also by Tracy, explored the way hedge funds have invested in newspapers, and the effects it has had on both the newspapers and on their ability to cover local news. “In the role of publisher, investors discovered that lowering overhead typically reduced costs at a faster rate than it drove down revenues,” Tracy wrote at the time. “Many papers shrank. And their profits went up.” What that can translate to: newspapers that are mostly ads, with a handful of original articles, some of them shared with other publications.
Another element of hedge funds’ purchase of newspapers was highlighted in a 2019 article in The Washington Post: namely, that some newspapers’ offices are valuable real estate in and of themselves, offering another model by which investors can profit. Michael Posner at Forbes also raised concerns about this phenomenon.
The idea of a well-off benefactor purchasing a newspaper and committing to high-quality writing certainly has some precedents in this day and age. With concerns about the decline of local news and its effect on democracy abounding, the question of how the Tribune‘s search for new ownership resonates deeply inside and outside of Chicago.
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