John Paton’s vision
This particular prominent executive has now been placed at the very top of the vast journalistic Alden-controlled hierarchy that boasts many properties both larger and smaller than the Daily Freeman of Kingston, New York. As CEO of the new MediaNews and Journal Register operations (both reorganized and their debt loads lightened after bankruptcy), John Paton sees hope amidst the ashes of the journalistic past. “Well, the walls have been scaled and the fortress sacked,” he said in the same speech. “Fortunately, we are left with solid foundations from which to be rebuilt.”
For Alden Capital, experienced in squeezing value out of distressed companies and re-selling, the strategic path is clear. Buy low, recover capital from the cash flow of the dwindling enterprises, look for unrealized value, and try to sell high.
John Paton has a message about unrealized value. He says that he thinks that rebuilding can take place around a classical skill, “original and compelling journalism.” According to his thinking, established journalism can in a new way serve its traditional role as a trusted filter for a mass audience, but it must do so in a new way: Digital First.
“The Crowd which has become our competitor is filling the web — the disintermediator of our industry — with news,” Paton explained in that same speech. “As a result, the web is a very crowded place for news. A filter is desired. It is even necessary. Original and compelling journalism are key to standing out, and it is the power of our brands, our reputation, that can spotlight — filter — for our audience where they should look for journalism they can trust.”
“Does Alden Capital know something that other newspaper publishers don’t?” asks Ken Doctor of the Neiman Journalism Lab. “Why is it seemingly upping its ante in an industry that has now suffered more than five years of no ad growth? I don’t think Alden’s found the formula. It does know that its properties, many bought dirt cheap, may become significantly more valuable if they can get on the other side of the digital divide, that magic time where sustainable, even small, profits are driven by digital, as the print business continues to wind down.”
Doctor isn’t sure whether the strategy will succeed. “The clock is Alden’s — and John Paton’s — big problem,” he writes. “The print business is winding down even faster than they thought it would, and those transition economics are tough. Still, for Alden with more than $2.5 billion in assets, this is a small play. If it doesn’t work, it’s chump change. If it does, and Alden can exit with a little profit, it could be quite an adventure.”
For newspaper publishers, the future demise of print, exaggerated or otherwise, posits uncomfortable alternatives. The strategy articulated by Paton at Journal Register has staked a clear position. Grandiosely entitled Project Thunderdome (a sense of humor is evident here), it is Journal Register’s plan for engaging audience and creating content across all platforms and geographies. Paton says Thunderdome will instill newsroom practices across all JRC properties “which conform to the new News Ecology of digital first and print last.”
