Detroit News owner to file for Chapter 11

[buildingsofdetroit]

http://www.prnewswire.com/news-relea...-81796317.html

Says it won't affect newsroom operations ...

[MichMatters]

I love the business world. If we were to believe them, always, nothing ever effects operations. lol A company could literally be days from ending, and nothing would effect operations.

BTW, the wiki page on MediaNews Group has this line in the very opening paragraph of the "corporate culture" section:

MediaNews Group is known as a cost-cutter in the newspaper publishing industry.

You get what you pay for, huh? If it were up to businesses, newspapers would literally be nothing other than ad circulars.

[BShea]

I've got a short story going up on CrainsDetroit.com about this. It sounds like the restructuring is just the holding company, and that won't affect the newspapers. Of course, the business decisions made by the holding company after the restructuring may affect them, but that's after the Chapter 11 stuff.

Also, The Detroit News JOA deal in unique ... Gannett pays MediaNews to own The News, and it pays for all the The News' editorial expenses ... by 2025, Gannett, through the DMP, will have paid MediaNews nearly $49 million. That's a little cash cow for MediaNews, so I don't see the sense in them doing much with Detroit soon. Other cities, maybe.

I did an explainer story that ran July 7, 2008, if you want the full monty on the MediaNews/Gannett deal for The News [[subscriber only, tho).

[oldredfordette]

Hilarious. I endured a meeting today where they told us we were doing really well, the "transformation" is exceeding expectations and we were charging ahead. Not a friggin word about this.

[Detroit500]

The Detroit News has really impressed me with filling their paper with so much more content as of late than the Detroit Free Press. The Free Press seems to have adopted this spectacle-style newspaper that is rich on images and big fonts, but very little tangible reporting. I would hate to see the News go the way of the Times.

[Ray1936]

I endured a meeting today

Love the way you phrased that, orf. During my working day I think I just 'endured' every meeting I ever had to attend. 95% of all business meetings are 90% useless. Not to mention terribly boring.

Just before I retired, while working as security director at a local hosptal here, department head meetings were held the second Tuesday of every month at 10 a.m. On 9/11 of 2001, as the events of that day were unfolding, the moron CEO insisted on holding the meeting anyway. Ran for two hours, and no one was listening to anyone.

[buildingsofdetroit]

Also, The Detroit News JOA deal in unique ... Gannett pays MediaNews to own The News, and it pays for all the The News' editorial expenses ... by 2025, Gannett, through the DMP, will have paid MediaNews nearly $49 million. That's a little cash cow for MediaNews, so I don't see the sense in them doing much with Detroit soon. Other cities, maybe.

Bill,
I thought MediaNews was on its own come August. When MediaNews came in, I thought the arrangement was for only five years of Gannett paying for editorial expenses?

[pffft]

It is the holding company, Affiliated Media, and not the newspaper/broadcast group, Media News.

Employees of the News were informed about this, but not employees of the Free Press or of the Detroit Media Partnership, which is why you wouldn't have heard about it today, ORF.

[BShea]

I'll have to double check on the editorial expenses, but the $49 million in payments, which are separate from the newsroom expense payments, run through 2025.

Honestly, I'll be a little surprised if either paper reports anything on this. It's been very hit-miss when they report on their own financial stuff [[apart from the delivery model switch). When there is something printed, it's often just a brief.

I would think the lenders who saw their investments turned into equity will want to see some serious value out of this deal, so the holding company will look to boost revenue/profit from its holdings. How that will play out at the newspapers is still down the road.

[pffft]

Debt restructuring in the holding company of a newspaper owner isn't gripping reading for most. Most people will probably be happy with a brief or short story.

Note that Media News papers had better circulation results than the industry as a whole:

http://denver.bizjournals.com/denver...1/daily30.html

[buildingsofdetroit]

http://freep.com/article/20100115/BU...ackaged-Ch.-11

[pffft]

http://www.detnews.com/article/20100...an-to-cut-debt

Note this quote from Singleton's employee letter that the Freep extracted:
"We who actually work in the newspaper business have a direct interest in keeping newspapers healthy. But we also can see that the communities we serve rely on newspapers, not only to keep everyone informed, and to check government and corporate abuse, but also to provide a cohesiveness that our society very much needs. ... Yet many of our citizens now take it for granted, and forget how precious it really is," Singleton said in a letter to employees.

[BShea]

It's cool they did full stories that acknowledge what's going on -- more then briefs.

I've talked to Singleton in the past. He struck me as very committed to print newspapers and believes they have a long future ahead of them. That said, he's got lenders that are going to want to see serious value in their ownership now. That could involve squeezing papers. I hope not, but I can't envision a scenario in which there isn't some bloodletting of some sort in coming months.

[pffft]

Consolidation in other markets perhaps, but there's already been consolidation here -- it's called the JOA.

[Rocko]

Got to agree with Detroit500 on this one, I'll always buy the News unless the Freep has a front page article that catches my interest more than whatever is on the News. The News tends to have a bit less eye candy and be a bit less tabloid about reporting issues....plus, they tend to run more articles I'm personally interested in. Hopefully this prepackaged Chapter 11 won't affect their news reporting abilities or end product.