The Phoenix Network:
About  |  Advertise
Letters  |  Media -- Dont Quote Me  |  News Features  |  Talking Politics  |  The Editorial Page  |  This Just In

Press Herald for sale?

Maine’s largest newspaper could have a new owner in the next two years
By JEFF INGLIS  |  August 24, 2006

Union officials negotiating new contracts at three Maine daily newspapers — the Portland Press Herald/Maine Sunday Telegram, the Waterville-based Morning Sentinel, and the Augusta-based Kennebec Journal — have begun to assume that the papers will soon be for sale, given the magnitude of the cutbacks sought by management. If the union position were substantially weakened, that would make the papers — which are struggling financially — far more appealing to outside buyers.

The papers are owned by the same family-run company that controls a majority interest in the Seattle Times newspaper in Washington state. And it has been a subject of widespread speculation in newspaper circles that the Times was itself up for sale.

The papers are controlled by the Blethen family, of whom patriarch Frank Blethen is the fourth generation to run the Seattle Times, which was bought in 1896 by his great-grandfather Alden Blethen, who was born in Maine but moved to Seattle as an adult.

One hundred and ten years have taken their toll on the Seattle paper, and the eight years of Blethen ownership of the Maine newspapers have been an additional weight on the finances of the company. Both companies are struggling: in Seattle, the Times is fighting a bitter battle against Hearst, the owner of Seattle’s other daily newspaper, the Post-Intelligencer, hoping to close the P-I. The company has stated that it has lost millions of dollars over the past six years alone.

In Maine, where the Blethens’ 1998 purchase of the Press Herald and the other newspapers from Guy Gannett Publishing was heralded by pledges of increased revenues and decreased costs, costs have increased (despite hiring freezes, layoffs, and the shrinking of the physical size of the newspaper) while revenues have, at best, remained flat, according to company statements.

Because the Blethen interests are privately held, it is difficult to predict or speculate on their business dealings, but changes within the newspaper industry have given the family a new way out of a years-long financial mess. That new way effectively requires the sale of the Blethens’ Maine newspapers, despite the company’s longstanding practice of extolling family ownership over what they call “absentee corporations.”

In September 2003, Frank Blethen (who refused to comment for this story) told Press Herald reporter Edward D. Murphy he had considered selling the Seattle Times to raise badly needed operating cash, but was talked out of it by other family members. He said he was frustrated with suffering continued losses. And though the article summed up Blethen’s position as “ruling out” selling newspapers, it did quote him with a telling statement: “You have to ask yourself the question, ‘Can you just keep going?’” The answer three years later: not much longer.

Seeing the light
The Seattle Times Company is run primarily by the Blethen family, who have 50.5 percent of the voting stock, and by voting as a bloc control the direction of the company, sometimes over the objections of the minority owner. Until just a few months ago, the Knight Ridder media conglomerate held the remaining 49.5 percent of the company's voting stock. Last year, Knight Ridder ran afoul of its shareholders, who forced the company to put itself up for sale in mid-November 2005. The company was bought in mid-March to the McClatchy Company, a California-based newspaper chain whose flagship is the Sacramento Bee. (The $6.5-billion deal received the blessing of federal anti-trust regulators in June, in part because McClatchy sold off some Knight Ridder papers in markets where McClatchy already owned a paper.)

A couple months after Knight Ridder announced it would sell itself off to the highest bidder, Blethen representatives at the Morning Sentinel and the Kennebec Journal introduced new proposals into ongoing contract-renewal talks with those papers’ respective unions. The proposals, which are still being disputed by the unions, would give the Blethens permission to take away tasks from union workers and assign them to contract or freelance workers. But the move that really upset union representatives was a provision that would let the company move those tasks back to full-time workers who would not have to be members of the union.

To union members, that means a person could be laid off, their job taken away and given to a contractor, and the company could later hire the contractor as a full-time staffer who would be outside the union. Over time — some estimate about 10 years; others worry it could be far less — the union would just wither away. It’s a move negotiators have called “union-bashing,” and company representatives have told the unions to expect the same provision to be demanded during next year’s contract-renewal negotiations with the union at the Portland Press Herald/Maine Sunday Telegram. (At all three papers, the unions represent not only reporters and lower-level staff editors, but also workers in layout, printing, advertising, circulation, and distribution.)

1  |  2  |  3  |  4  |   next >
  Topics: News Features , Frank Blethen , Newspapers , Media ,  More more >
  • Share:
  • RSS feed Rss
  • Email this article to a friend Email
  • Print this article Print
Press Herald for sale?
I've been reading the Portland newspapers for years, and the overall quality of the Portland newspapers under the Blethen family is not really any better than the quality under the Guy Gannett company. The fact is that the Portland newspapers are thin at best, relaying too much on wire copy at the expense of independent reporting.
By Tmark on 08/23/2006 at 1:41:08
Press Herald for sale?
The newspaper is for sale, if you look at the shift of news content to ad content under Blethen ownership. The Real Estate section? It's no longer handled by news reporters and editors. It's an advertising supplement, with "news content" bought by the realtors. Weddings? Funerals? If you want coverage, call your Classified Ad rep and prepare to write a check. That content also is for sale, no longer covered by reporters. While readers cry out for more Local News, the Press Herald ditched the Your Neighbors Local News Section for South Portland, Scarborough and Cape. The reason? Not enough ads. What about the readers? Some days it seems that the advertising circulars in my newspaper are thicker than the paper itself.
By sioux on 08/24/2006 at 10:19:32
Press Herald for sale?
Interesting story and generally on the money from my perspective. However, you have made some glaring errors. There are few that doubt the paper(s) have declined in quality since the sale to the Seattle TImes. Simply look at the number of inches on local news vs. wire stories, the cut back of a reporter for state house coverage from both papers, now they share one, when he works. Page count confirms this, and then there is the lack of content on key sections---take the Sunday paper for example. IS there a business section that makes any reference to Maine business folks? No. This is an example buy you can find many each day. This is why circulation is falling. Then there are comments made at inside meetings by the editor when she said that there are few options other than selling. Shocking so many present, people only assumed it was frustration. As for the unions. Forget it guys. The Seattle Times operates out of the 1960 model of "my way or the highway..." Do not look for enlightened management or collaborative solution solving, this is not the style of the Seattle Times company and those Board members are now living in Maine and running the Maine papers. But your assumptions and the editors comments are most likely right, a sale will most like occur despite the Blethen family not wanting to do so. Your article did not draw the line between what the Blethen family "wants" and what it ends up "having to do". Selling is something none the insiders want to do, and will avoid doing or even thinking about, but they will. You are right, the market will most likely force the trade of the Maine papers to McClatchy people. Your biggest error was even suggesting that any local paper company could gather either the talent or the financial ability to buy the Blethen papers. The Lewiston Sun Journal is incaple of such a purchase on so many fronts it boggles the mind. Chris Harte? Moving to Texas. Bangor Daily News, no way that this family newspaper would take on the debt, simple no way. Simply because someone owns some weeklies that do not make money (and they do not make money at all) you missed the only other option than McClatchy, Dean Singleton of Denver. His media company was hot on the heels of the Blethen family when bidding was hot during the sale. Blethen was bluffed and paid 10% more than Singleton, the notroious high bidder of the newspaper business. Singleton backed out at at around $190 million (your reported purchase price was too low, also). And yes, Mr. Singleton is ready to walk in and save the day. But for who? The answer is simple, most likey the Blethen Family and the financial life of the Seattle Times, but certainly NOT the unions or staff in Maine. Dean Singleton is known for walking in day one, ripping up the union contracts and reducing salaries (and yes the employees are WAY overpaid compared to other newspapers). So what will happen? Do not expect to get the answer ever from the Blethen management. And do not expect things to get better, life will be driven by what happens in Seattle since nothing good on the economic side of things will happen in Portland. Give it 18 months. Enjoy your days.
By boxcar on 08/25/2006 at 10:59:18
Press Herald for sale?
Bethan newspapers should just slam shut thier doors. All the drunken residents do up in Maine is complain and 'see' Liberal conspiracies when they read the newspapers. You think people are laughing now at Maine,Wait til there is no daily newspaper in Maine. lol! B. Washington, Boston,Massachusetts
By maine_sucks on 08/28/2006 at 3:59:45
Press Herald for sale?
Boxcar and the others - thanks very much for your comments! Sioux - you forgot to mention that obituaries are also now paid advertising, no longer considered local news. Boxcar's suggestion of Dean Singleton is an interesting one, and it may be the right one, or there may be others who come together in interesting arrangements, as we saw with the consortium of investors Brian Tierney collected in Philadelphia.
By Jeff Inglis on 08/31/2006 at 1:52:47
Press Herald for sale?
Now read this: Paid Ads on the Front of News Sections!!! On the heels of your well-informed article, newspaper management announced last week that a longstanding tradition is about to be broken separating the most important news from paid advertisement. Paid Ads will soon appear on Section Fronts! Imagine this, Jolly John sharing the front-page with a story on Global Warning. Staffers who attended the companywide meeting on the announcement said the Executive Editor, Jeannine Guttman, was in tears... There's good reason the rest of us should care about this. Advertisers get picky when they pay big bucks to promote their products. If they are going to shell out money for advertising, they may have conditions about the kinds of stories they want and DON'T want in the newspaper. This latest movement by the Blethens is just another example -- and the most glaring example -- of how the content of the Portland Press Herald is For Sale. Any bidders?
By sioux on 09/12/2006 at 7:47:33

Today's Event Picks
Share this entry with Delicious
  •   TOO SCARED TO WIN?  |  August 13, 2008
    Barack Obama must fight for his principles, or he’ll give away the keys to the White House
  •   A NIGHT IN GUANTÁNAMO  |  June 18, 2008
    Staying in a replica cell, with no waterboarding included
  •   BEAT THE CLOCK  |  February 27, 2008
    Does anybody really know what time it is?
  •   EXCLUSIVE: NO RAISES FOR SEVEN YEARS  |  November 14, 2007
    That’s just one way FairPoint plans to pay for northern New England's Verizon buyout
  •   LIVE EARTH 2007  |  July 10, 2007
    Where to go, who to see, what to know — even if you don't have a ticket

 See all articles by: JEFF INGLIS

RSS Feed of for the most popular articles
 Most Viewed   Most Emailed 

Featured Articles in Videogames:
Tuesday, December 02, 2008  |  Sign In  |  Register
Phoenix Media/Communications Group:
Copyright © 2008 The Phoenix Media/Communications Group