Retweet: The ‘Revolution’ at The Tampa Tribune will feature lower salaries and buyouts
If you are in the newspaper business you no doubt read Jim Romenesko’s newish website. That is why I don’t make reference to much of his material, I am assuming a reader has already seen the item. But this memo Jim got a hold of is of special interest to those who have been watching the destructive behavior of the private equity companies that have been buying up media properties for the past decade or so.
On October 8 TNM ran a post about the sale of the last Media General newspaper property, The Tampa Tribune, to Revolution Capital Group, a Los Angeles private equity firm that also has interests in Lawrence Schiff Silk Mills, a manufacturer of bow ties, and Dove Professional Apparel, a manufacturer of medical apparel. The inference was that this wouldn’t end well.
Today we learned that it wouldn’t start well, either.
The new owners have issued a memo that starts out “Re: Pay adjustment and voluntary severance program.”
The memo goes on to offer a “voluntary program” to buyout any employee that wants out. The company says it might reject your request based on “current business needs” but otherwise they’d like to see the back of you.
As for those who like working and getting a check, the new owners have more news. “In addition to the severance program to help us re-align costs to revenue, we will also be adjusting individual pay rates, effective immediately.”
That’s it, no new ties for the employees, not even a surgical mask – just an offer to let you go, or a cut in pay if you’re not interested.
While the tech community repeats its print is dead mantra, and paid shrills speak at industry event to say that in fact print is not dead two kinds of owners taking control of the industry. One is the private equity firm, the other is the owner who wants a media outlet for political/business reasons.
The new PE owners are not much different than many of the newspaper execs still around who employed roll-up strategies to build their newspaper empires. These execs targeted locally owned daily newspapers, reasoning that these papers would have higher payrolls. The new owners came in and began chopping heads and consolidating operatings. The strategy built profits in an era when newspapers dominated local and regional advertising, but we are now seeing these companies failing as they have little resources left around to develop digital media products.
The other new owners really have no interest in profiting directly from their new newspaper holdings. They want to influence voters and politicians. A newspaper that can help convince voters to vote in low tax, no regulation politicians can make millions for its owner in other ways.
More and more the newspaper business in the U.S. is beginning to look like Europe where almost all newspapers are tied to a business interest, or a political party or individual politician.
On the bright side, I predict that soon we’ll hear less about the death of newspapers, and more about how the nation might be better off with fewer of the newspapers that are still around.