The Gannett and GateHouse Media Merger and Our Nation’s Local News Crisis

This blog post was created for a blog reporting on the newspaper industry as part of Drew University’s New York Semester on Media and Communications in Fall 2019.

Last Tuesday, Gannett, the parent company of USA Today and over 100 other dailies, and New Media Investment Group, owner of GateHouse Media officially joined forces. The decision is expected to severely alter not only the struggling newspaper industry but the general media landscape as well. One in five US dailies will now fall under Gannett, making it the largest newspaper publishing company in the nation.

Poynter depicts the GateHouse/Gannett merger. Gannett newsrooms are in blue and GateHouse in black.

The company will be led by Michael E. Reed, chief of New Media, and now chief of over 260 dailies and 24,000 employees. The merger, which was made in an effort to save money, is striking the question of excessive layoffs. According to Reed, “a significant portion of the cost reductions are going to come from things other than people.” However, many newspaper companies have made these very statements, only to then layoff many. Two of these companies being both Gannett and Gatehouse Media.

Just last January, Gannett made major cuts in their newsrooms across the country while several of Gatehouse’s newsroom faced layoffs both last May and last August. In the past two years, the number of employees at Gannett alone has fallen by one-fifth, a shocking amount for a company that, despite its intention of cutting costs, continues to promise fewer layoffs.

Many anticipate differently than what the company promises, and fear the merger will have detrimental effects on the local newspaper crisis our nation is already embedded in. Over 2,000 newsrooms have closed their doors in the last 15 years, with many local journalists abandoning the profession completely. And as a result, many American communities are becoming news deserts, losing touch with local news and politics and leaving national reporters with less credible sources to turn to.

As for Gannett and New Media, last week Neiman Lab estimated in “Newsonomics” that one in eight people will be let go as the two attempt to cut over $400 million in costs, a number that has continuously risen since the companies first announced their plans to merge months back. This massive goal comes after both New Media Investment Group and Gannett missed their revenue projections in the last quarter. 

And Gannett and New Media Investment Group aren’t the only companies looking for safety in a merger. In an attempt to also battle industry struggles, Tribune and McClatchy executives are looking at a potential alliance as well. Although no official verdict has been announced, many detest the idea as it could mean additional hundreds of newsroom jobs will be slashed. There are currently 37,900 newsroom employees in the U.S., the Gannett, and New Media merger may cut this number significantly, let alone a Tribune and McClatchy merger as well. In recent news for this pair, McClatchy is on the edge of bankruptcy and Tribune’s largest shareholder Michael Ferro, sold 25% of the company’s stake Alden Global Capital, a decision many are not happy with as Alden has been described as the “serial destroyer of newsrooms.”

It is ironic, that the newspaper industry, an industry foundational to the nation’s democracy, will now be managed by a few, finance-centered corporations. The fate of local journalism and the general newspaper industry remains in the hands of corporations that may only continue to join forces, and supersize.

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