Why So Many Newspapers are Being Bought and Sold in 2016

newspapers

Everywhere you look and practically everywhere you read, there’s another newspaper bought, sold, taken over, in negotiations or holding out with the aid of the last ditch “poison pill” defense. What’s going on in publishing that makes so many properties, which many would kindly describe as distressed, such hot commodities?

RELATED: Is Consolidation the Future for Newspapers?

Dailies from one coast to the other have changed hands with a fury lately. There was the controversial and very secret purchase of the Las Vegas Journal Review, which put everyone in the newsroom on red alert once the political party funding Adelson family was revealed as the new owner. And currently, Gannett and Tribune Publishing are embroiled in a bitter tug of war where a jaw-dropping $815 million was deemed a bit shy of what Tribune executives thought was fair.

It all boils down to revenue. If not now, then presumably in the future. News will always be important, wherever it comes from, and ad revenue will evolve once again.

Buying Low is the Order of the Day

Even with offers in the millions, dailies are comparatively a bargain. “Prices have dropped dramatically as the newspaper business has struggled,” says Rem Reider for USA Today. And “newspaper” doesn’t exactly mean what it used to. There are still plenty in print, and print advertising dollars are on a steady decline. But most newspapers are also struggling, with mixed results, to get digital under control.

While it’s not impressive compared to print advertising of yesteryear, some bigger publications are seeing their digital engagement and ad revenue increase. Poynter explains that although The New York Times print ad revenue was down 7 percent for the 4th quarter of 2015, digital revenue was up 11 percent. That softened the blow of print losses to about 1 percent. It’s encouraging across the board.

Newspapers
It might look like good money after bad, but investors rarely part with millions lightly.

Newspapers Still Need Alternative Revenue

Newsrooms are a shadow of their former selves, and stock is valued at pennies on the dollar. Newspapers still survive, if barely. But alternative revenue sources, such as recruitment advertising, could help strengthen dailies and make up the ad dollar difference as many of the more traditional advertisers scurry away to non-news digital locations such as Google and social media.

Recruitment advertising is a win / win for everyone involved. It drives more site visitors and generates a new revenue stream. And it helps newspaper publishers locate new, prospective advertisers through an automated lead generation program. It’s good for employers and job seekers, too, because automated candidate matching makes site visits more fruitful and worthwhile.

As newspapers across the country change hands faster than you can click on a digital ad, many of them are starting to get digital advertising right. It requires some resources, which might come from a wealthy investor, such as Jeff Bezos at the Post, or from strength in numbers. But it also requires some ingenuity, perseverance and a willingness to take some risks.

Some still predict the utter demise of newspapers, but one has to wonder whether the naysayers believe that news will cease to be relevant or if getting news will become a piecemeal thing where journalistic integrity just doesn’t matter anymore. For now, newspapers still matter. The proof is in the investing and the staggering amount of money changing hands.

With the improving numbers in digital, what might really be happening is just another evolution that’s beginning to sort itself out.

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