In yet another example of the collapse of the newspaper industry, Rupert Murdoch has sold the Cape Cod Times, the Barnstable Patriot and the Nantucket Inquirer-Mirror to Gatehouse Media the owner of the local weeklies which include The Cape Codder, The Register, the Provincetown Banner and The Harwich Oracle.
That leaves just two locally-owned newspapers, the Cape Cod Chronicle which has editions in Chatham and Harwich and the Enterprise Newspapers which has editions in the upper cape towns of Bourne, Falmouth, Mashpee and Sandwich.
"Those silly little Ottaway Newspapers"
Murdoch got the former Ottaway Newspaper group when he purchased the Dow Jones newspaper five years ago to acquire The Wall Street Journal. He voiced his disdain for what he got by calling them "Those silly little Ottaway Newspapers".
He put them on the market several times to no avail until Gatehouse bought them yesterday at what industry insiders call a "fire sale price".
The Cape Cod Times publisher Peter Meyer said ten corporate employees were let go. The local daily's staff has 265 employees. Dow Jones’ Local Media Group includes 8 daily and 15 weekly newspapers which News Corp., chief executive Robert Thomson said “were not strategically consistent with the emerging portfolio” of News Corp.
Gatehouse already owns 97 dailies in 20 states and 198 paid weeklies. In eastern Massachusetts Gatehouse already owned 6 suburban daily newspapers and more than 100 weekly newspapers
When will the "cost-cutting" begin?
Jon Chesto writing today in the Boston Business Journal asks two tough questions about the sale.
Gatehouse revenue fell 5 percent last year, and the future is bleak for print newspapers in general. The sale includes the former Ottaway newspaper chain of eight daily and 15 weekly community newspapers.
The press release from Dow Jones read:
News Corp Sells Dow Jones Local Media Group
News Corp announced today that it has sold the Dow Jones Local Media Group, which operates 33 publications, including 8 daily and 15 weekly newspapers, to an affiliate of Fortress Investment Group LLC.
The Dow Jones Local Media Group daily newspaper franchises include the Times Herald-Record (Middletown, N.Y.); Cape Cod Times (Hyannis, Mass.); The Record (Stockton, Calif.); The Standard-Times (New Bedford, Mass.); The Pocono Record (Stroudsburg, Penn.); The Herald (Portsmouth, N.H.); The Mail Tribune (Medford, Ore.), and The Daily Tidings (Ashland, Ore.). In addition to daily and weekly newspapers, the Dow Jones Local Media Group operates other print and online community media, including web sites, magazines as well as news and advertising niche publications.
The Dow Jones Local Media Group operations will be managed by GateHouse Media, one of the largest publishers of locally based print and online media in the United States with a portfolio of products that includes over 400 community publications and approximately 350 related websites.
Waller Capital Partners, a leading independent investment bank focused on the telecommunications, media and technology sectors, advised Dow Jones on the sale of the Local Media Group.
Financial terms were not disclosed.
Below is the Gatehouse Media memo to employees:
TO: GateHouse Media Employees
FROM: Mike Reed, CEO
DATE: September 3, 2013
News Corp announced today that it has sold its Dow Jones Local Media Group. The purchase was made by an affiliate of Fortress Investment Group LLC. Fortress is also the majority owner of GateHouse Media and has engaged GateHouse Media to provide management services for the properties./CONTINUES
Beginning today, GateHouse Media will manage 33 Local Media Group (LMG) publications, including 8 daily newspapers and 15 weekly newspapers in 7 states. The daily newspaper franchises included in the sale are Ashland Daily Tidings in Oregon; Cape Cod Times of Barnstable, MA; Mail Tribune of Oregon; Pocono Record of Stroudsburg, PA; The Portsmouth Herald of Portsmouth, NH; The Record of Stockton, CA; The Standard-Times of New Bedford, MA; and Times Herald-Record of Middletown, NY.
Coinciding with today’s announcement, GateHouse Media will have a senior executive at each LMG daily newspaper office either today or tomorrow, as we thought it would be timely to have some of our senior staff members visit the properties and meet employees.
We are pleased to announce that Bernie Szachara has been named General Manager of LMG, and will report to Kirk Davis, President and Chief Operating Officer of GateHouse Media. Bernie is an accomplished media executive who spent the bulk of the past 10+ years working in information technology, production, digital product development, strategy, and revenue diversification. Specifically, Bernie’s most recent work involved independently consulting for FTI Consulting, a business advisory firm, and more importantly, serving as Executive Vice- President/Strategic Initiatives, Operations and IT for The Denver Post. Prior to Denver, Bernie spent 20 years with Gannett in senior operations and IT roles. He received his BS in Production Management from Rochester Institute of Technology (RIT), and his MBA in Business/Commerce from RIT as well.
We look forward to working closely with LMG’s publishers and sharing ideas across both companies. The properties that comprise LMG are highly respected. Moreover, the management teams from both companies share a common belief that the future for local media holds much promise.