GateHouse paid $47.5 million for paper in April with big noise about commitment
This April Fool’s joke had a delayed punchline. And it’s a bad joke at that, but in line with unfortunate trends in the newspaper industry.
New York-based GateHouse Media plunked down $47.5 million to buy the Austin American-Statesman in April with grand statements about its intentions for the newspaper.
A March 6, 2018, story in the Statesman, which announced the deal would close April 2, quoted GateHouse’s Jason Taylor, president of the company’s U.S. publishing operations: “GateHouse is committed to the rich legacy of quality journalism that the Statesman has contributed to both Austin and the state of Texas,” Taylor said. “I can promise you now our mission is to sustain local journalism.”
GateHouse said the Statesman would become the “flagship” of its expanding chain on publications.
Now comes the news from Statesman Publisher Susie Biehle, who in a written statement said:
“Effective October 11, we will cease publication of ¡Ahora Sí!, our Spanish-language print product. We’ve had a great 14-year run. Our valued audience has rapidly moved to digital, and we need to serve them in a different way.
“We are extending voluntary severance offers to all Statesman employees. The process will be completed over the next month or so. This gives our employees a choice for those who were mulling retirement or a change in careers. This also allows us to better align our resources around the areas of most importance to our readers and advertisers. We are aggressively pursuing a path to greater revenue diversification and eventual overall growth to better support our entire operation. In the challenging media landscape that affects all Texas newspapers, this path doesn’t stray from our commitment to do journalism with impact.”
Biehle told The Austin Bulldog the paper has “around 200 employees. I don’t have the exact number.” She said “about 100” of those are in the editorial department.
The Statesman’s story on the changes says those who take the severance package would depart the newspaper in September and quotes Biehle as saying, “This gives our employees a choice for those who are mulling retirement or a change in their careers. This also allows us to better align our resources around the areas of most important to our readers and advertisers.”
Biehle told the Bulldog said numbers of employees she provided include those who work at the company’s Community Newspapers Group, which includes the Bastrop Advertiser, Lake Travis View, Pflugerville Pflag, Round Rock Leader, Smithville Times and Westlake Picayune.
¡Ahora Sí!, “has only two staff dedicated staff members,” Biehle said, although other employees assist in producing the publication.
The Statesman’s story ends with, “We are aggressively pursuing a path to greater revenue diversification and eventual overall growth to better support our entire operation,” Biehle said. “In the challenging media landscape that affects all Texas newspapers, this path doesn’t stray from our commitment to do journalism with impact.”
Long history, lots of awards, and realigning
Newspaper veterans who have seen or experienced these kinds of changes that are ripping through the industry know that current employees with the highest salaries—and digital skills not on a par with younger journalists—are among those the newspaper would most prefer to accept the buyout offers.
Although the buyout offers were made to all employees, the company will decide which among those who accept are actually let go.
The March 6 story claimed the Statesman had daily circulation of 85,000 and nearly 17,000 digital subscriptions and had been named Texas Newspaper of the Year in three of the past four years by the Texas Associated Press Managing Editors.
In April this year the Statesman was recognized with 23 awards from the group, including for stories, photos and videos published in 2017.
“Strong enterprise, a good mix of coverage and a really nice sense of the community are all hallmarks of the paper and shine through in these samples,” the judge wrote of the American-Statesman.
The newspaper’s Wikipedia page contains historic roots for the paper stretching all the way back to 1871, with succeeding mergers and acquisitions it eventually became the Austin American-Statesman in 1973, and at that time was publishing four daily editions.
Cox Enterprises bought the paper in 1976 and in 1987 it became a morning-only publication. The paper was put up for sale in 2008 and then taken off the market in 2009.
Eventually the newspaper shut down its printing presses and outsourced that work to out-of-town printers, resulting in a big cost savings but at the expense of up-to-date information involving news that broke later in the day, including everything from football games to city council meetings.
The land and buildings were sold and a developer was hired to plan the future of the site, which is still home-base for the paper’s employees.
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Related Bulldog coverage:
‘Austin American-Statesman’ Cutting Staff Again: Voluntary job buyouts offered to 167 employees, June 10, 2011
Community Newspapers Locked in Fierce Competition for Readers and Advertisers: independents survive against Cox-owned papers, upstart ‘Community Impact’ carving a new niche, August 4, 2010
Ken Martin has been covering local government and politics in the Austin area since 1981. See more on Ken on the About page. Email [email protected].
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