Highlighting the same concern, the ProJo published a December 2005 op-ed by William Falk, the editor of The Week magazine, in which he bemoaned how, even though newspapers remain very profitable, “the mammoth corporations that now run newspapers have responded to the new competitive challenges in the stupidest way possible: by cutting quality . . . The corporate guys, who think only of pleasing Wall Street, keep cutting costs and boosting profits — and wringing their hands in puzzlement when circulation keeps going down.”
It took only a few days before Anthony Baglini of Lincoln implored, in a letter to the editor, “Please take a cue from Mr. Falk’s article: ‘People stop buying newspapers when there’s nothing in them that they don’t already know.’ I might also add: when there’s too much advertising and not enough news.”
WOULD-BE BUYERS: Although Belo’s not selling, Sundlun (left) and Cianci have expressed interest in acquiring the Journal.
The potential suitors
About five years ago, periodic rumors suggested that the New York Times was looking to buy the Providence Journal, but this chatter proved unfounded, and Belo managers have steadily insisted that they have no plans to sell.
Newspaper industry analyst John Morton calls the prospect of Belo selling the ProJo “very unlikely. Newspapers of the size of the Providence paper are hard to come by, and even though it hasn’t done particularly well in advertising — nor has the [Belo’s flagship] Dallas Morning News — it’s a valuable property and they aren’t under any pressure to do anything like that.”
Using a traditional formula for estimating a newspaper’s value — multiplying average daily circulation by $1500 — Morton says the Journal could be expected to fetch in the neighborhood of $240 million if it was put on the market
“If it was for sale, I wouldn’t have much trouble putting together a group that would be able to buy it,” Bruce Sundlun told me last week.
Beyond the colorful former governor, though, the Phoenix was unable to find any Rhode Islanders with a current interest in buying the ProJo — in large part, one suspects, because of how the state is far less affluent than during its industrial heyday.
Jonathan M. Nelson, the principal in Providence Equity Partners — which was reported in October to be considering a takeover bid for Tribune Company — seems like one local with the potential ability to acquire the paper (he didn’t return a call seeking comment). But a friend, downtown developer Arnold “Buff” Chace, doesn’t think Nelson would be interested. “He’s a private person, so he probably wouldn’t want to be involved in a local institution like that,” Chace says, adding that he hasn’t discussed the matter with Nelson.
Although he mused a few years ago on the possibility of funding a competitor to the Journal — a reflection, he says, of his frustration with what he calls the paper’s diminished interest in local affairs, Chace says he lacks the resources to buy it. Some other members of his family, which owned the Berkshire Hathaway textile business, before selling it decades ago to Warren Buffet, have deeper pockets.