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Tuesday, May 17, 2022

Daily News Could Be Sold

The Los Angeles Daily News is among the newspapers that could be sold as parent company Digital First Media said Friday it was reviewing strategic alternatives for its business.

The Daily News, in Woodland Hills, is part of the larger Los Angeles News Group of papers that includes the San Gabriel Valley Tribune, Pasadena Star-News and Torrance Daily Breeze, among others.

Digital First, based in New York, owns 800 daily and weekly papers and news websites that serve 15 states, making it the second-largest newspaper company in the U.S. by circulation.

The company said it may sell its entire company as a whole or one or more regional clusters – or simply continue operating. Digital First has pursued a strategy of operating editorial websites in combination with print properties.

In a memo to employees that was obtained by media news site jimromenesko.com, Digital First Chief Executive John Paton said that while the company has made progress, it may need more scale to compete.

“Other than the usual die-hard skeptics, it is now a given that newspapers, as multi-platform news organizations, will thrive in the future as the best and biggest providers of local news and advertising in their markets. But scale is the key to that future. Scale to build the products our customers want” the memo stated.

“Any newspaper company’s future will rely upon its ability to build those products fast and as cost-effectively as possible. So, we are now reviewing all of those options – those strategic alternatives – that best position our company for the future. I am not sure of the outcome of that review or how long it will take,” the memo went on to state.

There has been speculation in the publishing industry over the future of Digital First since the April closure of Project Thunderdome, a centralized, digital only content producer for the entire chain.

That closure was part of a larger, $100 million cost-cutting initiative as print advertising revenue declined at a faster pace than the company’s digital innovations, according to an April story by industry analyst Ken Doctor at the Neiman Foundation website.

Doctor also speculated that New York hedge fund Alden Global Capital Digital First, majority owner of Digital First, could have “fatigue” over the property’s lack of financial progress.

Digital First was formed in December 2013 in a merger between MediaNews Group Inc., owner of the Daily News and Los Angeles News Group, and 21st Century Media.

Los Angeles News Group Publisher and President Ron Hasse had no comment on Digital First’s announcement.

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