Congress is talking once again about making Google and Facebook pay for news

Sen. Amy Klobuchar is a lead sponsor of the Journalism Competition and Preservation Act. Photo (cc) 2019 by Gage Skidmore.

By Dan Kennedy

A bill that could force Google and Facebook to fork over billions of dollars to local news outlets has lurched back to life. The Journalism Competition and Preservation Act, or JCPA, would allow publishers to negotiate as a bloc with the two giant tech platforms, something that would normally be prohibited because of antitrust concerns. The proposal would exclude the largest publishers and, as Rick Edmonds notes at Poynter Online, would lead to binding arbitration if the two sides can’t reach an agreement.

The legislation’s cosponsors in the Senate are Amy Klobuchar, D-Minn., and John Kennedy, R-La.; the House cosponsors are David Cicilline, D-R.I., and Ken Buck, R-Colo. That bipartisan support means the bill might actually be enacted. But is it a good idea?

The premise on which the legislation is built is that Google and Facebook should pay fair compensation for repurposing the news content that they use. This strikes me as being much more straightforward with Google than with Facebook. Google’s mission is to index all the world’s knowledge, including journalism; Facebook is a social network, many of whose users post links to news stories. Facebook isn’t nearly as dependent on journalism as Google is and, in fact, has down-ranked it on several occasions over the years.

Google’s responsibility isn’t entirely clear, either. Yes, it links to news stories and publishes brief snippets. But it’s not a zero-sum situation — there’s no reason to believe that Google is depriving news publishers of traffic. It’s more likely that Google is pushing users to news sites and, with the rise of paywalls, may even be boosting subscriptions for local news outlets. Still, you could make a philosophical argument that Google ought to pay something because it benefits from having access to journalism, regardless of whether that deprives news outlets of any revenues.

A similar law in Australia has brought in $140 million, Edmonds reports. But critics have complained that the law’s main effect has been to further enrich Rupert Murdoch, still the leading press baron in his native country.

The JCPA should not be confused with the Local Journalism Sustainability Act, or LJSA, which would provide three tax credits for local news outlets — one for subscribers, who would get to write off news subscriptions on their taxes; one for advertisers; and one for publishers for hiring and retaining journalists. As Steve Waldman, chair of the Rebuild Local News Coalition, recently told us on the “What Works” podcast, this last provision is especially powerful because it would provide an incentive to do the right thing even at bottom-feeding chains owned by Alden Global Capital and Gannett.

Despite bipartisan support, the LJSA ran aground last year when President Biden split off the publishers’ credit and added it to the doomed Build Back Better bill. Perhaps it will be revived.

Is either measure needed in order to revive local news? What Ellen Clegg and I have found in the course of reporting for our book-in-progress, also called “What Works,” is that many independent local and regional news organizations across the country, nonprofit and for-profit alike, are doing reasonably well without government assistance. Since both the JCPA and the LJSA would be time-limited, maybe it’s worth giving them a try to see what the effects will ultimately be. But neither one of them will save local news — nor is it clear that local news needs saving once you remove the dead hand of corporate chain ownership.

Life after Gannett: Nemasket Week debuts in Middleborough and Lakeville

By Dan Kennedy

Independent local news startups are breaking out everywhere, so forgive me if I pay a little extra attention to today’s debut of Nemasket Week, a free, advertiser-supported print newspaper and website. The paper covers my hometown of Middleborough as well as neighboring Lakeville, and is the first news outlet those communities have had since Gannett killed off the Middleboro Gazette last year.

The first issue of Nemasket Week comprises 12 pages and has several local ads. It also has news — the naming of a new fire chief on page one, a feature on a performance by the High Flying Dogs, the select board’s evaluation of the town administrator, the adoption of body cams by the police departments in both communities, and (gasp) the closure of the Peaceful Meadows ice cream stand. A number of community announcements and an obituary round things out.

And get this — they actually sent a reporter to Williamsport, Pennsylvania, to cover Middleborough’s appearance in the Little League World Series. The opening loss came too late to make it into the print edition, but there’s a detailed story online.

Sadly, the paper has embraced the “Middleboro” spelling instead of the correct and proper “Middleborough.” But that’s an ancient debate, and the Middleboro Gazette used the shorter name even back when it was an independently owned paper.

This is an impressive debut. Congratulations to publisher Anne Eisenmenger for adding to what was already an impressive regional presence comprising Wareham, Dartmouth and the Sippican communities of Rochester, Mattapoisett and Marion.

Will Gannett ghost the Cambridge Chronicle? It sure looks like that’s a possibility.

Map of Cambridge from the Leventhal Collection at the Boston Public Library

By Dan Kennedy

Fears that the Cambridge Chronicle would become a ghost newspaper were allayed last fall when Gannett transferred veteran journalist Will Dowd from the Marblehead Reporter to replace Amy Saltzman, who was stepping down as editor.

The Chronicle, founded in 1846 and regarded as the oldest weekly paper in the country, survived two Gannett purges this past spring: it was one of just three weeklies in Eastern Massachusetts that would still cover local news after journalists at all the other weeklies were reassigned to regional beats (the others spared were the Old Colony Memorial of Plymouth and the Provincetown Banner); and it was kept intact as a standalone paper when Gannett shut down 19 weeklies and merged nine others into four.

But now the Chronicle is on the brink. Dowd has returned to Marblehead, this time as editor of an independent nonprofit startup, the Marblehead News. And his departure comes just as Gannett has completed yet another round of layoffs, which raises questions about what the chain’s intentions are for filling any open positions.

It doesn’t look good. In scrolling down the Chronicle’s website this morning, I couldn’t find a single local story — everything was either regional or statewide. The paper’s Twitter account has been silent since July 6.

If Dowd isn’t replaced, that would represent a grotesque abdication of responsibility in a city of 118,000. The Chronicle ought to have a staff of several people; instead, it may be moving from one to zero. Cambridge has some good hyperlocal projects, including Cambridge Day and the Cambridge Civic Journal. What it lacks is a news organization with paid, full-time journalists. Will anyone step up?

Gannett lays off journalists, closes papers and keeps the numbers to itself

Frank Gannett (1876-1957) founded the newspaper chain that bears his name. Photo (cc) 2009 by History Rewound.

By Dan Kennedy

What more can be said about the latest round of Gannett layoffs? This one was telegraphed well in advance, and I wrote about what was coming three times (here, here and here) before the hammer finally came down on Friday.

We don’t know the extent of the damage; The Associated Press reported that the “company declined to provide details about the number of people losing their jobs.” The number 400 has been bandied about, but is that 400 journalists or 400 total employees? In any case, that number has not been verified. We do know that the cuts were broad and deep, from Worcester County, where, according to Grafton Common, the chain’s weekly papers were decimated, to its national flagship, USA Today.

Los Angeles Times reporter Jeong Park has provided one way of looking at what happened. Gannett owns about 250 newspapers and other properties, and, before Friday, it employed about 4,000 reporters, editors and photographers. Our three national papers together also employ about 4,000 journalists — The New York Times (1,700), The Washington Post (1,000) and The Wall Street Journal (1,300). And, unlike Gannett, they’re all growing.

Gannett’s losses in the most recent quarter were so vast that it seems likely management will come back for another bite at the apple in a few months. After all, they’ve been on a rampage in Eastern Massachusetts, closing a number of weeklies in 2021 and 19 earlier this year (the company also merged nine papers into four). They’ve pretty much given up on local coverage, too.

Meanwhile, the company’s top executives pay themselves millions of dollars, and even the part-time board members are getting north of $200,000. And it’s been reported that CEO Michael Reed bought another 500,000 shares of Gannett stock last Tuesday, paying $1.22 million.

This feels like the end game, but it probably isn’t. There are always more papers to close, more people to lay off and more websites to strip of any real journalistic content. My heart goes out to the folks who lost their jobs on Friday. I hope they all land on their feet — and I also hope that many of them will look into the possibility of starting independent news projects in the communities they used to cover. The need and the opportunity are there.

We end our summer podcasts with a round-up of local news items. See you in September!

Rainbow Arch Bridge, Lake City, Iowa, the center of a bizarre newspaper war. Photo (cc) 2014 by David Wilson.

On this week’s podcast, Ellen and Dan dive into their reporter’s notebooks after their scheduled guest had a last-minute medical emergency, catching up with NJ Spotlight News, the emergence of The Lexington Observer, the transition at The Texas Tribune, and the turmoil at The Graphic-Advocate (both of them!) of Lake City, Iowa.

Ellen also has a rave for Emily Rooney’s “Beat the Press” podcast and her recent interview with legendary WCVB-TV news anchor Natalie Jacobson, who’s written a memoir about her life and career.

Like Boston’s Orange Line and Green Line, the “What Works” podcast will be off the intertubes for a few weeks as Ellen and Dan race to meet the deadline for their book about the future of local news. You can listen to our conversation here and subscribe through your favorite podcast app.

While Gannett journalists brace for layoffs, those at the top rake in big bucks

Photo (cc) 2008 by Patrickneil

By Dan Kennedy

With Gannett targeting its journalists for yet another round of layoffs, I thought it would be a good time to take a look at the people at the top. A reminder: Gannett is an amalgamation of the old Gannett and GateHouse Media, which was notorious for cost-cutting and which dominates the new Gannett.

There’s a wealth of information — and a lot of wealth generally — in the money-losing newspaper chain’s 2022 proxy statement. It begins with Michael E. Reed, the chairman and chief executive officer, who was paid $7,741,052 in 2021. Of that total, Reed received $900,000 in base salary, $6,074,000 in stock awards and $767,052 in “Non-Equity Incentive Plan Compensation.”

Next up is Douglas E. Horne, the chief financial officer and chief accounting officer, whose payout added up to $1,753,698, of which $600,000 was base salary, $581,318 came in the form of stock awards, $562,380 was for that aforementioned incentive plan and $10,000 was in other income.

Also of interest is Gannett’s nine-member board of directors, eight of whom were paid well in excess of $200,000 to provide advice and counsel on a part-time basis. Now, I have no insight into how much work a Gannett director puts in — although, according to Investopedia, the average corporate board member takes part in just a bit under eight meetings per year. In general, though, serving on a corporate board is an exceedingly light lift. The board chair, as previously noted, is Reed. Here are the other eight directors and their compensation. You can find their company-provided bios (except Hegde, who has left the board) in the proxy report, starting at page 14.

  • Kevin M. Sheehan, $285,000 ($160,000 in fees or cash; $125,000 in stock awards)
  • Vinayak Hegde, $212,500 ($87,500 in fees or cash; $125,000 in stock awards)
  • Theodore P. Janulis, $251,250 ($120,000 in fees or cash; $125,000 in stock awards; $6,250 in other compensation)
  • John Jeffry Louis III, $235,000 ($100,000 in fees or cash; $125,000 in stock awards; $10,000 in other compensation)
  • Maria M. Miller, $225,000 ($100,000 in fees or cash; $125,000 in stock awards)
  • Debra A. Sandler, $245,000 ($120,000 in fees or cash; $125,000 in stock awards)
  • Laurence Tarica, $255,000 ($120,000 in fees or cash; $125,000 in stock awards; $10,000 in other compensation)
  • Barbara W. Wall, $235,000 ($100,000 in fees or cash; $125,000 in stock awards; $10,000 in other compensation)

For the eight board members other than Reed, that’s an average of $242,969. I can’t offer a judgment as to whether that’s excessive, but I can cite a few data points. First, in 2018, USA Today, Gannett’s flagship newspaper, republished a story from 24/7 Wall Street under the provocative headline “25 companies that pay their board of directors a shocking amount.” The lowest of those 25 was Citigroup, which paid its board members an average of $297,407 — more than Gannett, but not massively more. Second, according to Investopedia, the average corporate board member is paid $42,750, although it was much higher than that at larger firms.

You also have to ask what, exactly, Gannett’s executives and board members are being rewarded for. Last week’s bad news was only the latest for a company that seemingly can’t find a way forward. Its stock price closed at $2.36 on Friday, down from a 52-week high of $7.05 last Sept. 17. Yes, we are in the midst of a local news crisis. But Lee Enterprises, another publicly traded newspaper chain, is doing reasonably well, as are independent local news sources across the country, from larger newspapers like The Boston Globe and the Star Tribune of Minneapolis to hundreds of hyperlocal projects. Gannett needs to demonstrate that it can provide communities with the news and information they need, and they’re failing miserably at that.

Meanwhile, the people doing the actual work make peanuts. According to a study in the fall of 2020 by the NewsGuild-CWA, Gannett journalists at 14 unionized daily newspapers were earning a median salary of $52,000, and those with fewer than 10 years of experience were making $43,000 to $44,000. Those at non-union papers are almost certainly making substantially less. And now they are bracing for yet another round of layoffs, while the people presiding over this fiasco are paid hundreds of thousands or millions of dollars.

A terrible day for Gannett, to be followed by terrible days for its staff and communities

The late Gannett chairman Al Neuharth, who created USA Today, was no stranger to cost-cutting. But he’d be rolling over in his grave at what’s taking place now. Photo (cc) 2013 by George Kelly.

By Dan Kennedy

Gannett, the country’s largest local news chain, is in a tailspin. The publisher of some 200 daily papers reported a significant loss in the second quarter — $54 million on revenues of $749 million.

According to Rick Edmonds, who analyzes the media business for Poynter, the company is either down or missing its targets in digital and print advertising as well as print circulation. The sole bright spot: a steady rise in paid digital circulation. Extensive layoffs are on the way. Edmonds quoted a memo from Maribel Perez Wadsworth, head of the media division, in which she said: “In the coming days, we will … be making necessary but painful reductions to staffing, eliminating some open positions and roles that will impact valued colleagues.” It’s hard to see how shrinking an already diminished product is going to help.

Those of us who live in Eastern Massachusetts and environs might wonder where they are going to find any staff members to lay off. Over the past year, the chain has closed many of its community weeklies. Its dailies are still publishing, but with skeleton newsrooms.

The question with Gannett is how many of its problems are simply part of the overall local news crisis and how many are of its own making. Tim Franklin, senior associate dean and the John M. Mutz Chair in Local News at Northwestern’s Medill School, tweeted:

As it turned out, Lee did reasonably well, which Chris Krewson, executive director of Local Independent Online News (LION) Publishers noted in a response to Franklin.

I would argue that though the challenges facing community journalism are very real, there are some unique factors at work with the current iteration of Gannett, which lost its way in the cradle back when GateHouse Media was born. GateHouse and Gannett merged a few years ago, but it was essentially a takeover by GateHouse, which has been pillaging its local titles for the past 15 or so years. Gannett’s schemes to overcome the mess in which it finds itself strike me as harebrained. Its plan to pursue sports betting isn’t going well, as Edmonds reports. Then there is its dream of getting into nonfungible tokens (NFTs). Seriously?

Gannett’s flagship is USA Today, which is still a solid paper. If I had to guess, I’d say they’ll leave it pretty much alone so that they can use it as a wire service to fill up their regional and local papers. I mean, even more than they’re already doing.

Sadly, Gannett’s journalists have been on a roll, with reporters at the Indianapolis Star and The Columbus Dispatch breaking the story about a pregnant 10-year-old rape victim — and then confirming it when it was questioned by right-wing propagandists and by Washington Post fact-checker Glenn Kessler. The Austin American-Statesman obtained and published video of the police (non)response to the school shootings in Uvalde, Texas, after editing out the children’s screams. This is outstanding journalism, and soon Gannett will have fewer journalists.

Gannett’s greed and incompetence are going to mean fewer jobs for reporters and less coverage for local communities. It’s an ongoing tragedy, but it does open up possibilities for entrepreneurs who are looking to start new projects.

Elizabeth Hansen Shapiro tells us about her national campaign to invest in local news

Elizabeth Hansen Shapiro

On the latest podcast, Dan and Ellen talk with Elizabeth Hansen Shapiro, CEO and co-founder of the National Trust for Local News. She is also a senior research fellow at the Tow Center for Digital Journalism at Columbia Journalism School in New York. At the Tow Center, Dr. Hansen Shapiro’s work focuses on the future of local journalism and the policies needed to assure that future. Her research involves audience engagement and revenue strategies, as well as the relationship between news and social platforms. She holds a Ph.D. in organizational behavior from Harvard Business School.

The National Trust for Local News is a nonprofit that is dedicated to “keeping local news in local hands.” The Trust works with local news publishers, philanthropists and socially conscious investors, and, as Dan has reported, worked with other collaborators to buy 24 weekly and monthly newspapers in the suburbs of Denver, Colorado, perhaps saving them from hedge fund ownership.

Dan has a Quick Take on a recent newsletter by past “What Works” guest Kristen Hare of Poynter, who reported on local media people who are starting to fight back against the abuse they’re receiving from some of the more sociopathic members of their audience.

Ellen weighs in on the death of Tim Giago, the founder of the first independently owned Native American newspaper in the United States, and dives back into the Dumpster fire in the newsroom of The Aspen Times in Colorado.

You can listen to our conversation here and subscribe through your favorite podcast app.

A free weekly newspaper will cover Middleborough and Lakeville

Oliver Mill Park, Middleborough. Photo (cc) 2022 by Dan Kennedy.

By Dan Kennedy

Local news outlets are popping up left and right following the decimation of our Eastern Massachusetts weekly newspapers at the hands of Gannett. But I want to give a special shoutout to Anne Eisenmenger, who’s going to launch a new weekly paper in mid-August to cover Middleborough, the town where I grew up, and neighboring Lakeville.

Nemasket Week, which will debut on Aug. 18, will be a free, advertiser-supported newspaper with a website. It’s part of Beaver Dam Partners, which currently publishes Wareham Week, Dartmouth Week and Sippican Week, serving Marion, Mattapoisett and Rochester. Eisenmenger, a Boston Globe and GateHouse Media alum who began Beaver Dam 12 years ago, has a proven track record, and I’m looking forward to seeing what she can offer in Middleborough.

Gannett shuttered The Middleboro Gazette last November as part of a wave of weekly closures — about a half-dozen in 2021, followed by 19 in 2022, along with nine others that were merged into four titles. Even worse, nearly all of Gannett’s weekly reporters were reassigned to regional beats, which means that the chain’s papers and websites have little or no local news.

So best of luck to Nemasket Week. And though it’s well outside Eisenmenger’s region, may I suggest that she take a close look at Medford while she’s at it?

The full announcement follows. And by the way, Anne, it’s Middleborough, not Middleboro. Both spellings are in use, but the town is literally the middle borough between Plymouth and Bridgewater.

Tim Coco of WHAV tells us how hyperlocal radio can serve a community

Tim Coco

In this week’s podcast, Dan and Ellen talk with Tim Coco, president and general manager of Public Media of New England. Coco is known for his work as a journalist and advertising executive. He oversees day-to-day operations at the low-power FM station WHAV, which can be found at 97.9 on the radio dial if you happen to be in the Haverhill area. The station also streams at WHAV.net.

WHAV was launched in 1947 by the Haverhill Gazette newspaper, then a daily under the auspices of a publisher who was distantly related to the Taylor family, which then owned The Boston Globe. Coco revived the station about 15 years ago and converted it to a nonprofit, low-power FM station in 2014.

Ellen has a Quick Take on $2 million in grants awarded to seven nonpartisan news outlets in Georgia. All are led by people of color, and all serve diverse audiences. The money, which comes from The Pivot Fund, could be transformational.

Dan’s Quick Take is on the Herald-Tribune. No, not that Herald-Tribune. This is the Herald-Tribune of Sarasota, Florida, which had to apologize after publishing a guest op-ed in praise of the Proud Boys, the far-right group that was part of the Jan. 6 insurrection at the Capitol. It’s a doozy.

You can listen to our conversation here and subscribe through your favorite podcast app.