Private equity owners endanger Daily Camera’s future

Editor’s note: An early draft of this editorial was submitted to the Daily Camera editorial board Friday morning, April 13, 2018, for publication on the Camera’s website Saturday, April 14, and in print Sunday, April 15. This is our usual process. Draft editorials are edited, corrected and revised during the day, but the early draft serves as the basis for approval, or not, and recommended revisions by board members. The editorial board consists of the publisher, executive editor and editorial page editor. In this case, the executive editor and editorial page editor supported publication. The publisher did not. On most matters, the editorial board operates democratically, but in this instance, the subject being the business itself, the publisher exercised his veto and killed the editorial. I elected to publish it on a different platform for the reasons stated in the editorial: This is a story about an important, longstanding Boulder institution. As journalists working in that community, we have an obligation to our readers to tell it.

— Dave Krieger, editorial page editor

 

The first-ever Colorado Journalism Week (April 16-22) arrives at a moment both inspiring and dispiriting for American journalism, and newspaper journalism in particular.

Inspiring because, at its highest levels, American journalism has rarely been more energetic. Investigating foreign interference in our last national election and the most unusual presidential administration of our lifetimes, The New York Times, Washington Post and Wall Street Journal are breaking important stories on a daily basis.

Dispiriting because, at many smaller papers, including this one, the journalistic lifeblood of communities large and small is being systematically drained by their owners’ private equity business model. One of the more insidious aspects of this process is that these communities are generally left in the dark about what is happening because the newspaper is the community storyteller. When it fails to tell this important story about itself, it breaks trust with its readers. We have remained quiet about this for too long.

The Daily Camera is 128 years old, counting its first year as a weekly. Much of the city’s history is recorded in its archives. If Boulder had another 128-year-old institution in danger of imminent demise, particularly one exercising an essential democratic freedom enshrined in the Bill of Rights, the Camera would be obliged to cover it. But we have a dilemma on this particular story: the desire of your local journalists to see the Camera survive and thrive versus the desire of our private equity owners to continue draining cash from the business without encountering any more adverse publicity than necessary.

The Denver Post took this debate to a new level of prominence last week by publishing a Sunday opinion section condemning the draconian cuts required by its owner, the New York private equity firm Alden Global Capital. Alden owns a controlling interest in Digital First Media, which owns the Post, the Camera, and more than a dozen other Colorado papers. The Post urged Alden to support its journalism or sell the paper to someone who will. This decision came after yet another round of personnel cuts, leaving the Post newsroom, now located in Adams County, a shadow of its former self.

The trajectory of the Camera’s decline has been more gradual, but over time the effect has been the same. Including our most recent round of layoffs in late 2016, our resources have consistently declined despite our continuing profitability. Recently, we lost our business editor. We do not know when or if we will be able to replace her. Imagine a daily paper without a business editor trying to cover a town that considers itself the high-tech and startup capital of Colorado.

Part of this loss of resources can be explained by the well-known impact of the internet on newspapers’ business model. With so many advertising dollars moving to the web through behemoths like Google and Facebook, all newspapers face new business challenges. But this secular problem should not obscure the predatory behavior of private equity investors.

“Between 2012 and 2016, according to the Bureau of Labor Statistics, all newspapers lost 24 percent of their workforces,” the American Prospect reported recently. “But at a sample of 12 papers owned by DFM, the layoff rate was more than half, according to a tabulation collected by journalists who worked for DFM papers.”

A lab experiment illustrating this point is occurring in the Twin Cities of Minnesota, which once had two robust metropolitan papers in the Minneapolis Star Tribune and St. Paul Pioneer Press. One, the Star Tribune, was bought by a local billionaire, Minnesota Timberwolves owner Glen Taylor. The other, the Pioneer Press, is owned by Alden. The Star Tribune is thriving, with an estimated 250 journalists in the newsroom, thanks to Taylor’s belief in supporting community journalism. The Pioneer Press has suffered draconian cuts similar to those in Denver and can no longer hold a candle to its former competitor in Minneapolis.

Journalism is not just any business. It is part of our democratic infrastructure. A minority shareholder in Digital First Media recently filed a lawsuit claiming Alden has drained tens of millions of dollars from its newspapers in order to make dubious, unrelated investments. In a court filing in response to the suit, Alden essentially admitted as much. The Nation reported that Alden principal Randall D. Smith bought up 16 mansions in and around Palm Beach, Fla., for $57.2 million. As always, Alden declines comment. It does not appear to harbor any sense of corporate responsibility or accountability.

“There is no long-term strategy other than milking and continuing to cut,” newspaper analyst Ken Doctor told investigative reporter Julie Reynolds. “Their view is that in 2021, they’ll deal with that then. Whatever remnants are there, they’ll try to find a buyer.”

Doctor also helped to answer a question we are hearing from our subscribers: How can we hope to survive by simultaneously shrinking our product and increasing our prices?

“They keep ratcheting up the price for the die-hard subscribers,” Doctor said. “Everybody talks about the demise of the (local) paper. But Alden has been able to track it, and there’s a lag time. It takes people a while to cancel. As people drop the paper, in the meantime they’re maintaining or growing their profits.”

Whether a particular form of capitalism should be permitted to destroy local First Amendment institutions serving millions of Americans is now a national conversation, thanks to the Post. Reaction to its plea was swift. The Nation wrote about it. So did Esquire. The New York Times put it on the front page. The Washington Post published an in-depth piece Friday under the headline, “As a secretive hedge fund guts its newspapers, journalists are fighting back.”

Taking a cue from the Denver Post, even Alden-owned publications are daring to speak up. “In an extraordinary editorial, (the Post) bravely implored their owners — the same investors who own our news organization — to support local journalism or sell the properties to someone who will,” wrote Neil Chase, executive editor of the Mercury News of San Jose. “The union that represents our employees has been saying the same thing for months.”

The Camera takes pride in serving as our community’s public square for discussion and debate of many local issues. To refuse to acknowledge this one would be tantamount to declaring that the Camera’s loyalties lie with its corporate overlords and not the community it serves. If we do not host this conversation, other platforms surely will.

So, as we observe this first Colorado Journalism Week, we believe it is part of our obligation to our readers to let them know as honestly as we can of the existential threat to this 128-year-old Boulder institution. Without a new owner, or intervention of some other kind we haven’t imagined, Boulder, like Denver and many other communities in Colorado and elsewhere, is in imminent danger of losing its daily newspaper once it has been bled dry.

A happier outcome is still possible. Alden has sold certain properties, including the Salt Lake Tribune and Berkshire (Mass.) Eagle, to local investors willing to support these institutions. Groups of potential investors are now discussing possible bids for the Post. We would like to see similar activity in Boulder before it’s too late.

-30-

Standard

28 thoughts on “Private equity owners endanger Daily Camera’s future

  1. BB says:

    I do have sympathy for you guys despite some of the errors and bias I’ve observed over the years. I canceled a 15 year subscribtion in 2016 because of an underhanded piece run by one of your current writers. Too bad because I do enjoy local news. I think your biggest error was shutting down the online comments. The ownership issue would be much better recognized by the community if there was a place where it could be disclosed and discussed. Online comments would be a great venue for that. It was kind of a wacky town hall that provided an arena for people to discuss and disclose the local political corruption brought about by single party rule. Whether it was the duplicitous goings on with the muni or inside info on local scoundrels like Macon Cowles it really provided a great community service. I guess it’s not too late to fire it back up. It certainly would gain you a lot of goodwill in the community. As the Washiston Post says: democracy dies in darkness. Best wishes in your efforts to secede from Alden’s control. I certainly hope that you succeed.

  2. Rebecca Dickson says:

    Thank you, Dave Krieger, for calling out Alden Global Capitol. I have subscribed to the Camera since I first moved to Boulder in the late 1980s. I don’t always agree with the Camera’s opinions, but keeping up with local news is vital. A democracy cannot function if citizens do not know what is going on locally, nationally, and internationally. May someone far richer than I am step up and invest in the Camera and the Denver Post.

  3. Jennifer Peters Johnson says:

    As one of those diehard subscribers I commend you and the staff on what you’ve been able to do with limited resources. I pray that local investors and philanthropists will wrest control from Alden—and then support your work without interference.
    I have often found your editorials to be grounded and wise—a relief in a town that tends to choke on its own dogma.

  4. Loren Piller says:

    When a local owner of any business sells out to some conglomerate from somewhere else the end has come. People have to be more aware of what is happening to their locality and in turn support it rather than Wall Street.

  5. Stew Sallo says:

    “This is a story about an important, longstanding Boulder institution. As journalists working in that community, we have an obligation to our readers to tell it.”

    I wonder if Krieger will feel the same obligation to tell Boulder County readers about the award-winning (30 SPJ – Society of Professional Journalists – awards to the Camera’s 3) Boulder Weekly’s upcoming 25th anniversary. Independent journalism is alive in Boulder County, despite the greed of the Camera’s ownership and the corresponding decline of their product.

    • Oh Stew, if only your Weekly wasn’t so, well, weakly … Congrats on the honors, now maybe you should invest in your publication rather than sucking out all the money for you in order to make it excellent. And gee, perhaps more than weekly? Gotta admit, the Camera doing a better job and daily news … A thought

  6. Rowland says:

    I say the Post did it to themselves. They are way to left leaning and they are proud of it. If they listened to the community-based as they claim they do, they wouldn’t have lost so many subscribers. They are looking to blame someone else, try looking in the mirror. Instead of trying to blame someone else, try printing something that people want to read. I feel the Denver area would be better off with the Post gone!

  7. ptd2015 says:

    Thank you for an informative piece. Too bad people confuse the right of a free press with “agree with my views.” Too bad it’s also true that “free market” means subscribers walk and investors decide. But it does. Engage those with a broader view as you are doing and get the word out.

  8. Larry Nelson says:

    Well said, Dave Krieger. I hope your piece doesn’t get you fired. I support your plea to save print journalism, the only thing protecting us from the kind of corporate bullying thriving under the Trump Administration. I just paid for another year’s subscription to the Camera ,albeit the digital version, not to be confused with the “Digital First” version. It is not appreciably cheaper. I thought that meant I was paying to sustain a fully staffed news organization.

  9. Caroline Hoyt says:

    I appreciate the Camera and have been a subscriber for over 40 years. I actually prefer the digital edition because it is set up to allow me to see every page in full unlike the digital NYTimes.
    Thank you, Dave Kreiger, for telling us what you are dealing with. I sincerely hope you can find a local buyer for the Camera. It is a priceless asset for our community. Boulder would be a poorer place without its hometown paper.

  10. Rosie Piller says:

    Thank you very much for having the courage to post this piece. I too hope that the Daily Camera is able to extract itself from Alden’s grasp.

  11. As John Nichols at The Nation has urged, local news media must be subsidized or owned by government if it is to survive. Like Nichols, I believe news media is so essential to a healthy democracy that this must happen.

    • BB says:

      The media and the government should not collaborate on anything. It’s just contrary to the idea of a free press. Unfortunately, we had a bit of that type of collaboration with the media seemingly being in partnership with the last presidential administration. The people don’t seem to have liked that arrangement…

      • You want to bring partisan politics into it then you have to mention the obvious and complete “collaboration” between our current President and Fox News. Just watch the morning Fox News for word by word “policy” statements from Trump later in the day. Who’s leading whom by the ring in the nose.

      • BB says:

        Perhaps you’re correct re Fox News and Trump but Fox News is one entity in a vast media environment that is largely intent on resisting and destroying the current president. The problem is that a very large percentage of these entities opted to be less than vigilant in their coverage of the previous administration. Just as a city owned newspaper would treat the Boulder government. The thought of a Boulder owned Daily Camera in the context Boulder’s track record of single party rule and resulting corruption is about as Orwellian as it gets.

  12. Lawrence Chadbourne says:

    It would be indeed sad if the Camera cannot continue.I grew up with the paper,starting when I would go to the Buffalo Smoke Shop with ,was it just a nickel,to buy the daily for my parents,as a 9 year old,in 1957.Later during the heady days of the 60s I learned much about what was going on around the world from reading the Camera,And when I was up to expressing myself as a teenage activist,the Camera was kind enough to give me a platform.☺

  13. Sally Bell says:

    When local newspapers die, who is left to cover a scandal in an obscure city department, celebrate local accomplishments, tell us about the vital but boring details of municipalization, and a thousand other things each day? The community becomes vastly poorer. Since moving here 17 years ago, I have seen the Camera shrink in size and format, copy editing become more lax, and the paper even move. Now I know why. I hope you are able to surmount this problem with a community-oriented local buyer!

  14. Klaus Holzapfel says:

    Boulder understands the role of local journalism. Of course the Daily Camera has a much smaller audience than the Denver Post. We ought to look at a model to sustain both of them. Maybe something could be on the ballot to buy those papers, put them in a trust, run them in a manner where there is enough public support to sustain them and if there is a small loss, then cover it by public funds.

    Local journalism plays a very vital role in our society. Maybe we can come up with a blueprint for other communities facing similar problems and at the same time bring power back to the locals.

    Someone needs to back these efforts. If we want the big corporate vultures out then the vacuum needs be filled, either by small investors or by a public commitment.

    If a paper is clearly defined as an independent watchdog and 4th pillar of democracy then we might be able to find enough public buy in for a municipal owned paper. That sounds much easier than running our own power company 🙂

    • BB says:

      Agreed on your sentiments re the power company but this sentence contradicts itself:

      “If a paper is clearly defined as an independent watchdog and 4th pillar of democracy then we might be able to find enough public buy in for a municipal owned paper.”

      We already have the corruption and fecklessless inherent in single party rule. It would be a fools errand to municipalize our newspaper. I can’t even imagine the byproduct but start with reading the propaganda newsletter that the city puts out go from there. It would not be pretty.

  15. Chip Stewart says:

    I’m not normally a newspaper reader. But I do get much of my news second-hand from people who do. I live in Longmont, and the Times-Call and Camera are the same organization. All of the county news is handled, for all practical purposes, through this media. Another aspect is the announcement and coverage of community events: i.e. the Creek Festival, the International Affairs Conference, among many others.

    The electronic media is wrought with misinformation – and misspelling and grammar issues abound. I often loose the heart of the story because I’m busy counting obvious errors. The printed publications have checks and balances that eliminate most of these.

    The loss of the newspaper medium would be tragic. Unfortunately, it’s too late for many communities. The loss of history should be intolerable.

  16. Dee Dee says:

    We have lived here for nearly 40 yrs & have taken both papers for almost as long. Two years ago, after daily frustrations at the sophomoric, biased reporting, along with countless factual mistakes in both papers, we dropped our subscriptions. We really missed the hometown news aspect though, & last month decided to give it another go. However, it didn’t take longer than a week for us to question that decision, & we are again debating whether or not to cancel. As much as we want to support a local paper, the lack of factually based true journalism in both the Camera & the Post is disappointing . A newspaper should not be a propoganda sheet for the left. “It’s the bias, Stupid!”

    • BB says:

      I couldn’t agree with you more. Sophomoric is the term that really nails it. We had Alex Burness do a hatchet job on us when he was advocating for co-ops in low density neighborhoods. Reporters are not supposed to be advocates. Extraordinarily unprofessional journalism. I canceled the subscription and never looked back.

  17. Pingback: A CALL TO ACTION for Digital First Media editors and publishers – DFM Workers

  18. Don Lyle says:

    Well done, Dave. Kudos to you and Denver Post editorial folks for calling attention to the intentional dismantling of essential community resources

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