Article

MEDIANEWS GROUP’s OCEAN OF RED INK PUTS THE CROSSHAIRS ON THE BERKSHIRE EAGLE, or “What is the Boring Broadsheet to Do?” THE PLANET HAS THE ANSWERS

BY DAN VALENTI

In Septmber 1995 Denver-based Media News Group purchased the storied Berkshire Eagle from the Miller family. A bad combination of a faulty real estate purchase and switch over to color presses left the Millers deep in debt. They had leveraged almost $18 million at a time when the market was going south. That’s when MediaNews swept in, dictated terms, and bought at firesale prices.

The first thing the chain did was fire every last Eagle employee. Those wanting to remain faced pay cuts up to 40 percent only after the indignity of reapplying for their jobs, possibly to be turned away. The paper did its best under trying circumstances. They had some editorial talent carry over from the Miller days (Joel Librizzi, Ruth and Milt Bass), cultivated new talent (Jack Dew), and had to good sense to appoint a credible chief editor to run the newsroom (David Scribner).

Scribner soon faced the problem that all MediaNews editorial managers run up against: How do you run a credible news operation when the business side sucks everything out of news and funnels it back to Denver? An inevitable war of attrition set in against high journalistic standards, a conflict the Boring Broadsheet could not win. Fast forward to 2011. What do the Eagle’s diminishing number of readers see: an anorexic paper that recycles press releases from city hall, prints randomly selected wire stories, and consistently ignores the real news.

William Dean Singleton, MediaNews Group chairman and CEO, needed every cent from the Eagle he could get. Singleton had the reputation as the industry’s most heavily-leveraged media mogul. In building up the chain under the holding company of Affiliated Media Inc., Singleton acquired almost 60 dailies and more than 100 non-daily newspapers by pyramiding debt, buying distressed properties at pennies on the dollar, bleeding them for cost-out, them flipping for profit.

The risky business plan worked for awhile, until 2008. It was the mortgage crisis of that year in miniature, when greed masked as speculation, when speculation hid as investment, and when investment was built upon essentially worthless paper. When the market tanked, MediaNews ran into alarming problems. The same thing that had happened to the Eagle in the early 1990s happened to MediaNews Group — It became unable to service its enormous debt load.

By 2010, Singleton’s business plan had run up $930 million in debt against assets that were a mere fraction of that large number. All of a sudden, the media mogul and his lieutenants were drowning in an ocean of red ink that the dropping circulation of newspapers like the Berkshire Eagle could not evaporate by one drop. In fact, the Eagle and most of its kin only made the ocean grow larger.

The perfect storm continued with the rise of personal computers, interactive and technologically sophisticated mobile internet devices, and new, inexpensive platforms for delivering media and content. Newspapers started to see the writing on the wall. It spelled: “Doom.”

Around the bend, off of a sudden came that red sea. Though the sun looked over the mountain’s rim, it bathed its yellow rays upon the internet and made, as the poet Robert Browning might put it, “straight a path of gold for him.” The rumors that started last year about the Eagle being for sale stemmed directly from Singelton’s precarious debt position.

The Newhouse chain at one point looked into a purchase but backed off once their bean counters got a look at the the Eagle’s books. The ledgers scared them clear out of town. The Hearst and Scudder families reportedly expressed mild interest, the way a group of vultures might circle Don Knotts dying in the desert. There wasn’t enough meat there to bother.

The Eagle got beat at their own game by the Internet. They put up a web site for the “free” online paper but haven’t invested in the site, which remains stodgy and woefully dated. The essence of a complicated social trend, i.e., the downfall of the newspaper, that is the Internet began draining the Eagle’s ad revenue at an alarming rate.

That’s not what Singleton wanted to hear, of course, and it’s made for a rough year at 75 S. Church St. It also explains why the paper would bring in an editorial empty suit as its top editor, a sports guy who plainly is in over his head in directing a newsroom that needs more than anything else a leader who has news in his blood, a person willing to fight for his troops with the front office and not be corporate’s enabler. Yes, that’s one tough job, but isn’t that the point?

TO BE CONTINUED. LOVE TO ALL TILL THEN.

In January 2010, MediaNews filed in court for Chapter 11 bankruptcy protection. It filed what it called a “prepackaged plan” worked out in advance with creditors. The idea was that this would make the court doings move more quickly. MediaNews’ action marked the 13th newspaper publisher to file for bankruptcy in the prior 13 months.

27 Responses to “MEDIANEWS GROUP’s OCEAN OF RED INK PUTS THE CROSSHAIRS ON THE BERKSHIRE EAGLE, or “What is the Boring Broadsheet to Do?” THE PLANET HAS THE ANSWERS”

  1. James Beasely
    February 3, 2011 at 5:11 pm #

    OK, so far this is a good recap from Wikipedia. I look forward to seeing what revelations we find (and by “we”, I guess I mean “the Planet”).

    Good cliffhanger…I’ll be back tomorrow.

  2. SS
    February 3, 2011 at 6:28 pm #

    Thanks. I see Mr. B still can’t get over what you’re doing here, and that’s great. He’s one of your most loyal readers!! Wikipedia had none of the local angle and little of the rest. Keep up the fire. If the Mr.s Bs of the world find it too hot, well, che sara sara.

    • James Beasely
      February 4, 2011 at 5:17 am #

      I am a loyal reader. I love Valenti’s work. But that doesn’t mean I have to agree with everything he writes about. I’m not a mindless drone like you.

      I think the Eagle does a great job and if you don’t like it, then don’t read it and don’t advertise there.

      The daily newspaper is a privilege, not a right. So get over yourself (and don’t even get started on “responsible journalism” – I love Valenti’s work but communing on rumor and innuendo is hardly responsible; it’s entertaining though).

      • Jim Gleason
        February 4, 2011 at 10:59 am #

        The Eagle tries to make ruberto look good, as hard as that is to do. It never tells f any shortcoming he has or of any of the follies (Workshop Live, Spice, The Colonial) he has contributed public monies to. They fabricate stories about him and his administration, as well as that of Devil Patrick. to glorify them and their lackeys. Great job at telling the non-truth.

        • Nichols for mayor
          February 4, 2011 at 11:38 am #

          Jim,

          What stories about Mayor Ruberto were “fabricated”?

          Just because you don’t like the man personally (for whatever reason) doesn’t mean he hasn’t done a great job for the city.

          I’m voting for Nichols and would vote for Nichols even if Ruberto was running, but Ruberto has turned Pittsfield around and into something on the verge of being wonderful.

          (Still, go Joe Nichols!).

          • editor
            February 4, 2011 at 1:42 pm #

            Jimmy G is just a bitter man who has no life but to live through his computer. Can anyone say what Jimmy has ever liked in the city in the past 25 years?

          • danvalenti
            February 4, 2011 at 1:46 pm #

            editor
            Of course you can maintain that assertion, but the facts will not bear you out. Jimmy G has long proven, after overcoming obstacles that would have assigned those lesser among us to hiding and despair, that he cares about civic involvement. That is the most positive thing to like about the city — its form of government — which allows free speech and has no Star Chamber. I welcome Jim with open arms for this reason, and, as readers know, he’s not afraid to tell me when he thinks The Planet has stepped in it.

          • Joetaxpayer
            February 4, 2011 at 5:22 pm #

            I voted for Mayor Ruberto,but will say the eagle articles do not point out the facts that the city is going to have a very difficult time meeting all there obligations to the teachers and retires.What also compounds this is the fact that the city is going to builld a new high school and renovate phs and seem to have the lets keep it the way it has always been attitude.We have a shrinking pop. and school pop. which effects are already shrinking state aide.Makes you start to understand why so many people are getting out of city politics,They could not even cut the libary budget,there will be some hard decision to be made hope the new council and mayor have what it takes.

      • San Simeon
        February 4, 2011 at 12:01 pm #

        @JB Think you mean “communicating on rumor and innuendo. I enjoy Valenti’s work too, and he hasn’t his the fact that this site employs lots of ways of getting news, straight objective facts and also the skuttlebutt. That’s what make his site to refreshing and informative becuase if you got back and check he has an uncanny record of being accurarte with the rumors etc.

      • Joetaxpayer
        February 4, 2011 at 7:54 pm #

        You lost me when you said you like the eagle.The best part of the eagle is the orange bag they put it into,it is great to put dog crap in.

  3. Still wondering
    February 3, 2011 at 6:38 pm #

    It looks like it maight be time for us who give a damn to consider what would rise from the ashes once the BB goes down in flames.
    That being said, I have to add my 2 cents worth about what is wrong with the Eagle. Start with the “face” of the paper. The Op-Ed section. Why does the BB insult us readers with its daily diatribe from the DNC? Why does the BB print almost nothing but straight liberal columnists? (George Will is not nearly enough to conterbalance one of the most liberal papers in the country.)

    • Joetaxpayer
      February 4, 2011 at 8:25 am #

      Have to agree with still wondering the op-ed. part of the paper is so one sided it is almost comical.Although most of Berkshire co. is drinking there kool-aide.

  4. Luxor Rex
    February 3, 2011 at 8:40 pm #

    Well, I read the Eagle (the BB) and can’t recall they printed any of this stuff about its parent company being in bad shape. All this was news to me and 99.99% of us readers of the BB and the Planet. Only those know italls like beasley I guess knew all these details! What a fake.

    • James Beasely
      February 4, 2011 at 5:20 am #

      Oh, come on. I’ve posted a bunch of stuff on this blog site that was against Valenti’s comments and they weren’t posted.

      And that’s fine. The Eagle and Valenti both have a right manage their content.

  5. Ron Kitterman
    February 4, 2011 at 12:15 am #

    ” New times demand new journalism ” Rupert Murdoch

  6. GMHeller
    February 4, 2011 at 2:11 am #

    I don’t know about anyone else but I would subscribe to the online electronic version, the pay version, of The Berkshire Eagle, if the subscription price were decent but frankly the amount that management is asking is just too high for what one receives.
    I even phoned the subscription department once and made a counter offer for what I felt the online subscription was worth, but the subscription lady flat out refused to take a penny less than the asking price.
    So I read the free version.

  7. GMHeller
    February 4, 2011 at 2:47 am #

    Regarding your statement that The Berkshire Eagle’s management had the “good sense to appoint a credible chief editor to run the newsroom (David Scribner)”.
    You fail to make mention as to just exactly why The Eagle finally canned Mr. Credible, nor why it did so in such hurried, hush-hush fashion.
    From what I have been able to ascertain, the Far Left Socialist Progessive Mr. Scribner was caught taking a ladyfriend on what were supposed to be business trips for the newspaper.
    Then in true Marxist Liberal fashion, Mr. Oh-So-Credible expected someone else to pay the bill for his little honeymoons, including wining, dining, sightseeing, etc..
    Parent company, MediaNews Group, ultimately discovered that they were being scammed by their heretofore Mr. Credible and ol’ Scribby was shown the door, while readers were left to wonder just what the heck happened?
    Of course, none of the circumstances regarding Mr. Scribner’s hasty departure from The Eagle newsroom where ever revealed in the pages of the newspaper, but then so what else is new.

    • Joe Pinhead
      February 4, 2011 at 6:14 am #

      Mr. Heller,
      The mere fact that you would like the paper to report in a fair manner about things like Mr. credible, Mr. Stracuzzi etc is most appalling. I mean really next you’re going to want to get an impartial view of what’s going on in the world. Do you really think that you mere mortals have the ability to make rational descions? Well let me tell you that you don’t, as an example I cite the last election We the Press gave you the People all the DNC talking points on a daily basis and look at the collective decisions you people made. If we were to report unbiased and objectively you would see what kind of a mess we are creating.
      You sir are entitled to cradle to grave care, health care, welfare, food stamps, heating assistance, abortion on demand, a free cell phone- but when you think you’re entitled to the truth from your daily newspaper well you’ve just gone too far now.

      • GMHeller
        February 4, 2011 at 10:12 am #

        Barack Obama paid my mortgage and filled my car with gasoline, but he never said nuthin’ about free cell phone service, at least not to me.
        Where does one sign up for that, and why d’ya think Barack was holding out on me?

  8. James Beasely
    February 4, 2011 at 5:22 am #

    I will say about the Eagle, or at least one of their representatives at least, is that Clarence Fanto is bad for business. Forget about the junk he writes, but people won’t advertise with the Eagle (well, a couple I know of) because of Fanto.

    Want advertising revenue, Eagle, fire Fanto.

    • GMHeller
      February 4, 2011 at 10:03 am #

      Are you referring to the Clarence Fanto who insists on writing sycophantic verbiage whenever the opportunity is given him to interview Liberal celebrity types?
      And speaking of suck-up prose, has anyone ever once read a warts-and-all music review by Mr. Fanto of a James Taylor concert?
      Apparently, Mr. Fanto regards entree to Berkshire County’s resident/vacationing celebs as being more important than honest impartiality.
      So much for objective journalism.

      • Nichols for mayor
        February 4, 2011 at 11:36 am #

        GM,

        I certainly wouldn’t say that all of Fanto’s articles are “suck-up prose”.

        It’s amazing that Andy Mick hasn’t fired Fanto yet because Fanto has forced away advertisers by attacking them in his articles. Fanto is probably directly responsible for the loss of $200,000 of advertising revenue (as meaured by cancelled contracts, that doesn’t even include companies that Fanto pushed away from even considering the Eagle as an advertiser).

  9. editor
    February 4, 2011 at 7:15 am #

    Dan are you upset that the Eagle didn’t make you the editor? That would explain a lot of your obsession with The Eagle…

    • GMHeller
      February 7, 2011 at 9:36 am #

      Dan Valenti ain’t the only one disgusted with the utterly lackluster performance journalistically of The Berkshire Eagle.
      It would be one thing if local stories reported contained at least a good faith effort to present all the facts.
      But as readers have seen from the lousy coverage of Angelo Stracuzzi’s departure from Greylock Federal Credit Union, the lousy coverage of the Mayor’s now-on-hold proposal to overpay for PCB-contaminated land to build a new DPW garage, the lousy coverage of the number and variety of Cancer clusters in various Pittsfield neighborhoods, the lousy coverage of the waste and abuse that led to financial troubles at Edith Wharton Restoration, Inc. aka The Mount, the lousy coverage of …..(fill in the blank), The Eagle is plainly all too willing to omit significant aspects of local news stories in order apparently to protect sacred cows.
      One reaps what one sows.

  10. M Wood
    February 4, 2011 at 1:18 pm #

    Its easy take a minute and read the link paying attention to the parts about Loyalty to the citizens and the monitoring of power. Then ask yourself does the Eagle adhere to these basic principles?

    http://www.ehow.com/list_6558452_duties-press_.html

    • Joetaxpayer
      February 4, 2011 at 5:33 pm #

      Liberal rag=eagle+alot of ap news