Detroit | Old Free Press building sold for $4M-plus

Building was Freep's home from 1925-1998.

The iconic downtown building that once housed the Detroit Free Press during Knight-Ridder's ownership has been sold in an online auction for more than $4 million, the Lansing State Journal says today.

The identity of the winning bidder wasn't immediately known. The vacant building, which opened in 1925, has been owned by Florida-based Luke Investments since 2008.

The Freep moved out in 1998 and joined The Detroit News -- then owned by Gannett -- in another even older building from 1917 on the same street, West Lafayette. It's also home to the GCI-controlled Detroit Media Partnership, the agency that handles business operations for both papers under a joint operating agreement.

Both buildings were designed by the architect Albert Kahn.

The Freep's current 1917 home, too, has been on the market since January as the two papers plus the DMP seek a more modern location. The three entities employed about 1,500 people, including 600 downtown, when the building was put up for sale.

Across the country, Gannett and other publishers have been selling underused real estate as they shrink operations amid a strengthening market for commercial property. In many places, however, this has threatened historic buildings that once symbolized the power of newspapers in far better times.

Gannett has owned the Freep and held control of the JOA since a 2005 deal with Knight-Ridder. The News is now owned by MediaNews Group.

Current home of Freep, News and DMP also on market.

Detroit | 1st pay raises since '08 in new union pact

The unions at Detroit's two daily newspapers ratified new, three-year contracts yesterday that will include a new health insurance plan and the first across-the-board raises since 2008.

The vote totals by the unionized staff at the Gannett-owned Detroit Free Press and MediaNews Group's Detroit News were not disclosed by the Newspaper Guild Local 34022, but they were "overwhelming" in favor of the new deal, Lou Mleczko, longtime president of the guild, told Crain's Detroit Business today.

The last contract ended three months ago, but both sides agreed to work under its terms until a new deal was reached.

Journal Register gives all workers layoff notices

The notices came under the federal WARN act, which requires companies to give 60 days' public notice when 100 or more employees may be sacked at a single worksite, according to a report this afternoon in The Saratogian of Saratoga Springs, N.Y. The notices went to all employees, including members of the senior management team.

In September, Journal Register sought bankruptcy court protection for the second time. A sole bidder -- a subsidiary of Alden Global Capital -- has offered $122 million for the company. On Thursday in New York, a federal court is to consider whether to accept that bid.

Journal Register is run by a management firm that also operates MediaNews Group, Gannett's partner in Detroit plus California, Texas and Pennsylvania. Alden also owns a large stake in MediaNews Group.

The layoff notices may have been a formality to cover all eventualities. It's unclear whether Alden, if successful, will reduce staffing.

GCI owned the Saratoga paper until 1998, when it sold the daily via the Gannett Foundation to Journal Register.

Journal Register is based in Yardley, Pa., just outside of Trenton, N.J.

Detroit | Building for Freep, News put on market

[Architect Albert Kahn designed building constructed in 1917]

The Detroit newspaper operations plan to relocate to a more modern location elsewhere in the city within the next 18 months, and their existing building is being put up for sale, according to a memo distributed late this afternoon.

"The goal," wrote Detroit Media Partnership CEO Joyce Jenereaux writes, "is to put us in more comfortable, attractive and functional offices in an environment that’s more vibrant and stimulating than our current location on the edge of downtown -- while saving the extraordinary expenses of maintaining a nearly 100-year-old building."

The current site, built in 1917 from a design by architect Albert Kahn, is historic, but it’s been obsolete for decades, according to Jenereaux. It was built primarily as a newspaper printing plant. "We haven’t printed newspapers in this building for more than 40 years," she says, "but we’re still operating in offices that were, in many cases, converted from pressroom and newsprint storage areas."

In addition to the DMP, the building houses the Gannett-owned Detroit Free Press and the MediaNews Group-owned Detroit News. The DMP, which Gannett controls, is a joint operating agency that handles printing, advertising sales and other business operations.

The building was offered for sale at auction last year, drawing an offer of $4.1 million in November, according to Deadline Detroit, which said that figure was rejected for being too low.

The Detroit announcement follows a similar move last week by the Rochester Democrat & Chronicle. Other GCI properties have been sold, or are renting excess space to other tenants, including at Corporate's headquarters in McLean, Va., as the company trims operations worldwide.

USAT | Ellwood leaves to join Cox Media paper

Promoted to USA Today's No. 2 position in June 2011, Susie Ellwood once was a likely successor to then-Publisher Dave Hunke, before a reorganization he launched failed to revive the paper's flagging advertising revenue and circulation. He retired this fall after Gannett replaced him with someone from outside the company.

Ellwood

Today, Cox Media announced Ellwood has been hired as publisher at the far smaller Austin American-Statesman, effective Dec. 3. She succeeds Jane Williams, who was named Cox's senior vice president of television this summer.

Ellwood is a Gannett lifer. She joined the company at the now-defunct Arkansas Gazette in 1984. She was later promoted to CEO of the GCI-controlled Detroit Media Partnership, which handles advertising sales and other business functions for GCI's Detroit Free Press and MediaNews Group's Detroit News.

Declining national ads
In Detroit, Ellwood was a protege of Hunke when the DMP announced a radical solution to save the two papers: Home delivery Distribution was cut back to three days weekly in spring 2009. It's unclear whether the papers have stopped hemorrhaging red ink, however.

Ellwood's USAT prospects appeared to dim early this year. GCI's national advertising -- largely from USAT -- plunged 11% in 2011, to $446 million, from 2010. Double-digit declines followed in the first quarter and the second quarter, when Hunke announced plans to retire, and Corporate said it would look for a new publisher, rather than promote Ellwood immediately. Eventually, the company reached outside in May to hire Larry Kramer.

Over the past year, Ellwood helped oversee a redesign of USAT in print and online that was launched in September.

The Austin paper's weekday circulation is 118,910; Sunday is 178,177, according to the Sept. 30 ABC report.

Under Kramer, national advertising and USAT's circulation continue to decline. GCI's third-quarter national ad revenue dropped 8% from a year before, and circulation for the six months ended Sept. 30 fell nearly 4%, to 1.7 million.

Privately-held Cox Media's flagship is the Atlanta Journal-Constitution.

Detroit | Union nixes contract concessions: 'We are down to the Marines, and the Marines need a raise'

Labor unions representing employees at the struggling Detroit newspapers are pushing back on management's proposed two-year contracts that would include only merit raises, rather than across-the-board increases, plus costly changes to medical plans.

On Monday, the two sides met for the first time over new contracts that would replace those set to expire  Nov. 13. The negotiations cover employees in editorial, circulation and the pressroom at the Gannett-owned Detroit Free Press, MediaNews Group's Detroit News, and the Gannett-controlled Detroit Media Partnership.

In a bulletin to union members, negotiators noted that employees covered by the contract hadn't received raises since January 2008. Indeed, they said employees had agreed to pay cuts in November 2010, and also accepted health care concessions that included higher premiums. Last month, the Detroit operations eliminated about 70 jobs through buyouts.

Now, union negotiators say, they won't accept any more concessions.

"The employees have given enough already,'' the bulletin says. "We made sacrifices so the company could deal with changes in readership and advertising and the economic recession. We gave the company breathing room to deal with the new realities of the industry."

GCI's most fragile market
The bulletin continues: "The employees who are left are expected to do a lot more with less, and they are doing it. Now we are down to the Marines, and the Marines need a raise."

Detroit is GCI's most financially challenged market. The dominant auto industry is still recovering after the bankruptcies of Chrysler and General Motors, while the city and surrounding Wayne County have lost 300,000 residents since 1990. At 9.3% in September, the statewide unemployment rate remains one of the nation's highest.

In a risky bid to reduce further losses in 2009, the Detroit Media Partnership -- which handles advertising sales and other business operations for the two dailies -- ended home delivery for all but three advertising-rich days.

When digital-first doesn't include a pension

"I guess what John Paton means by 'not your grandpa's newspaper company' is that 
grandpa had a pension."

-- John Gapper, Financial Times columnist, in a Twitter post about the news yesterday that Journal Register Co. has filed for bankruptcy court protection -- the second time in three years. Paton is CEO of Digital First, which runs Journal Register and MediaNews Group, Gannett's partner in the Detroit newspaper agency. Gapper rightly highlights Paton's worrisome remarks about "unsustainable" employee pension costs.

Earlier: GCI slashes planned pension contributions by 20% for 2012. Plus: Paton to lead MediaNews and Journal Register.

Detroit | Silverman to prep on Passion Topics

That's Mark Silverman, formerly editor of The Tennessean, and now a roving News Department executive who's apparently training community newspaper staffs on the evolving Passion Topics initiative.

He's scheduled for a three-hour meeting at the Detroit Free Press on March 29, according to one of my readers.

Silverman knows the Detroit market well. He was editor of The Detroit News until 2005, when Gannett sold it to MediaNews Group as part of a complicated three-way deal where Knight Ridder sold the Freep to GCI and relinquished control of the Detroit Media Partnership joint operating agency.

Brevard | GCI reaches outside for new publisher

Corporate just announced in a news release that it hired former San Jose Mercury News Publisher Jeff Kiel as publisher of Florida Today.

Kiel

He replaces Mark Mikolajczyk, who has been publisher since 2006; in December, Mikolajczyk said he was leaving for a position with Craig Technologies.

Kiel was more recently executive vice president of sales and marketing at Westinghouse Solar, the release says.

In Silicon Valley's San Jose, Kiel was vice president of sales and marketing from 2002 until he was named publisher in 2007 at the MediaNews Group-owned daily. He moved to San Jose from Miami, where he had been vice president of finance and chief financial officer for the Miami Herald. Kiel held various positions at the Herald after joining them in 1988.

The Mercury News and the Herald were owned by Knight Ridder before that publisher was acquired in 2006 by McClatchy, which later sold the San Jose paper to MediaNews, Gannett's partner in Detroit, Silicon Valley, and elsewhere.

Brevard's circulation: weekdays, 59,038; Sundays, 85,496, according to the ABC's lookup database.

DealChicken | GCI doubles down on coupons

Gannett and seven other media companies are launching a digital shopping platform called Find n Save that includes a daily deals service. It's "tailored to local audiences, offering digital coupons, daily deals, digital circulars, and other advertising products,'' the consortium said today in a statement.

Other partners in the joint venture are Advance Digital, A. H. Belo Corporation, Cox Media Group, Hearst Corporation, MediaNews Group, McClatchy, and the Washington Post Co.

Find n Save arrives as GCI and others are competing with daily deals leader Groupon, which raised $700 million earlier this month in a closely watched initial public offering.

GCI launched its own deals site, Deal Chicken, in July, and it has now spread to nearly 50 U.S. markets.

Marin | This is your 21st-century newspaper office

Gannett owned California's Marin Independent Journal from 1980 to 2000, when it was sold to the California Newspapers Partnership, co-owned by MediaNews Group. GCI owns 20% of the partnership, which just announced huge layoffs. Former IJ reporter Beth Ashley revisits the paper in her column today: 

On the third floor of a huge building at 4000 Civic Center Drive, down a long corridor past unrelated business offices, sits a regimented roomful of small gray cubicles, each with a desk, chair, telephone and computer. One for each reporter. One for each editor. One for each ad salesman. Hardly your typical newspaper office. Hardly your typical newsroom. The carpet smells fresh and brand-new.

Singleton: Cross-ownership 'is yesterday's news'

From a Nieman Lab blog interview with MediaNews Group Chairman William Dean Singleton, where he discusses further newspaper consolidation, plus Federal Communications Commission limits on common ownership of papers and TV stations in a single market:

Singleton

The importance of cross-ownership is yesterday’s news. We don’t need a TV station to do video anymore. We don’t need a TV station to broadcast video anymore. You can do video in our digital offerings today, online, in mobile. I think the day will come when people don’t sit down in front of their TV and spend three hours watching TV or 30 minutes watching the news. They’re going to get it on their tablets, and computers. I think the need that newspapers thought they had to own TV stations is probably over. 

MediaNews and Gannett
They're partners in ventures publishing newspapers in Detroit, California, Texas and Pennsylvania.

GCI owns 23 TV stations, including two in each of two markets: Atlanta (WATL, WXIA) and Jacksonville, Fla. (WTLV and WJXX) Also, in Phoenix, it owns The Arizona Republic and KPNX.

Urgent: Journal Register's Paton named CEO of GCI partner MediaNews, as two combine management

In a statement, the Journal Register Co. said the following today:

Paton

Journal Register announced today the creation of Digital First Media Inc. Digital First Media will manage both Journal Register and MediaNews Group.

John Paton, as the chief executive of Digital First Media, will act as CEO of both Journal Register and MediaNews.

In a separate statement, MediaNews, the nation’s second-largest newspaper company as measured by circulation, announced its appointment of Paton as CEO and the new agreement with Digital First Media.

Paton, a director of Journal Register, has also been appointed to MediaNews' board of directors. Paton and Digital First Media will report to the boards of both MediaNews and Journal Register.

Paton replaces William Dean Singleton at MediaNews. Singleton will remain MediaNews' board chairman, however.

Gannett and MediaNews are partners in the Detroit joint operating agency, which publishes the GCI-owned Detroit Free Press and MediaNews' Detroit News. The two companies are also affiliated in publishing operations in California, Texas, New Mexico and Pennsylvania.

In recent trading, GCI's shares were up 6.1%, at $10.49. The overall market is up as well, lifting most newspaper publishers' stocks, too.

More consolidation ahead?
Today's deal may signal the start of a wave of further consolidation among major newspaper publishers.

In today's statement, Singleton was quoted saying:

Singleton

"Media News is intent on continuing its transformation from a print-oriented newspaper company to a locally focused provider of news and information across multiple platforms. At the forefront of our efforts is developing a successful digital strategy. . . . We are delighted to tap into John’s experience as we accelerate further our successful transition to a digital world."

Today's deal wasn't entirely surprising. The Poynter Institute's business blogger Rick Edmonds had predicted Paton would become MediaNews' CEO after hedge fund Alden Global Capital acquired all of Journal Register in July, and earlier acquiring controlling ownership of MediaNews.

Alden Global also is a major investor in GCI.

Earlier: California Newspapers Partnership cuts 120 jobs.

Layoffs | GCI Calif. news partnership cuts 120 jobs; eleven newspapers consolidated under two names

Taking regional publishing up a notch, the San Francisco Bay Area News Group is consolidating its 11 daily papers under just two nameplates, reducing overall employment by 8%, or 120 jobs.

The papers are mostly owned by Denver-based MediaNews Group, but minority owners include Gannett through the companies' California Newspapers Partnership.

MediaNews developments such as those disclosed Tuesday are of particular interest to Gannett Blog readers because the company's experience could influence GCI's direction.

For example, MediaNews instituted regional copy and design desks in Northern California well before GCI announced plans a year ago to establish five page production hubs to serve virtually all its 82 U.S. newspapers.

GCI has also been experimenting with more regional approaches to publishing, including single publishers and regional news over multiple publications, in Wisconsin, Central New York and, most recently, in New Jersey. This, too, has resulted in job losses. For example, in New Jersey, three dailies said they were reducing newsroom employment nearly in half last January.

Community news loss
Tuesday, MediaNews said it was making the changes to emphasize its regional approach to news coverage and free up resources to funnel into its digital initiatives, according to a report in one of the papers, the Oakland Tribune, across the bay from San Francisco. The move to streamline the group's operations will help reduce expenses as print advertising revenue continues to fall.

Left unsaid, however, is the fact that in a regional news approach, less attention is paid to town-specific coverage, further weakening competitiveness with online start-ups like AOL's Patch network.

MediaNews is the second-biggest newspaper publisher by circulation. GCI is No. 1, with USA Today included.

MediaNews and GCI also are partners in the Detroit joint operating agency, which publishes the GCI-owned Detroit Free Press and MediaNews' Detroit News. The two companies are also affiliated in publishing operations in Texas, New Mexico and Pennsylvania.

Partnership ownership details
GCI owns a 20% interest in California Newspapers Partnership, which includes 19 daily California newspapers, and a 41% interest in Texas-New Mexico Newspapers Partnership, which includes six daily newspapers in Texas and New Mexico and four newspapers in Pennsylvania, according to GCI's annual 10-K report to federal securities regulators.

The third investor in the California partnership is Stephens Media Group of Las Vegas.

The 10-K doesn't identify the California newspapers by name. On its Facebook page, however, the California partnership lists many of the newspapers included in yesterday's BANG announcement.

WSJ: MediaNews said possible Freedom bidder

MediaNews Group is among bidders thought to be circling Freedom Communications, parent of the Orange County Register and more than 100 other newspapers, plus a group of eight TV stations.

The company in Irvine, Calif., which emerged from bankruptcy a year ago, this week is giving bidders several options. Suitors can make offers for the entire company, or they can separately bid on the TV stations; the newspapers, or on the 277,000-circulation Register alone, The Wall Street Journal says in a story today. Bids are due today.

Should MediaNews succeed in winning any of the papers, a logical question emerges: Would it share any with Gannett? GCI and MediaNews already are partners in the GCI-controlled Detroit joint operating agency, plus a publishing partnership with dailies in California, Texas, New Mexico and Pennsylvania.

From GCI's annual 10-K report to the U.S. Securities and Exchange Commission: The company owns a 19.49% interest in California Newspapers Partnership, which includes 19 daily California newspapers; a 40.64% interest in Texas-New Mexico Newspapers Partnership, which includes six daily newspapers in Texas and New Mexico and four newspapers in Pennsylvania; and a 13.5% interest in Ponderay Newsprint Company in the state of Washington.

Other possible Freedom bidders include Tribune Co.; Gores Group; and Platinum Equity, owner of the San Diego Union Tribune, the WSJ says, citing "people familiar with the matter."

Updated: MediaNews denies consolidation report

[Updated at 8:56 p.m. ET with the following statement by MediaNews Group CEO William Dean Singleton, denying a report earlier today by the Newspaper Guild.]

The Newspaper Guild on Friday issued a press release referring to a casual phone conversation I had with Bernie Lunser, president of the Guild, concerning the future of the newspaper industry and how newspapers can better serve their readers in print, online and on mobile products.

Contrary to the assertions made in the release, there are no plans for "national consolidation" of MNG's editing processes.

While we constantly assess better ways to serve our readers in this changing and uncertain world, including the Guild in these considerations are not a part of those assessments.

The irresponsible Guild press release is a perfect example of why we don't.

There is no future for any of us if we continue to live in the past. Someone should tell that to the Guild.

-- Dean

MediaNews is one of Gannett's business partners. It controls 54 newspapers, including The Detroit News, plus dailies in Northern California, Texas and Pennsylvania that it owns in partnership with GCI.

MediaNews | Singleton is out; merger up next?

The founder and CEO of Gannett business partner MediaNews Group, William Dean Singleton, plans to relinquish day-to-day leadership of the Denver-based company after a replacement for him and the outgoing president is found, Denver Business Journal says. The management shakeup came yesterday after international hedge fund Alden Global Capital bought a significant stake in the company, the Journal says.

Singleton

The Wall Street Journal reported late yesterday that MediaNews is "eyeing a merger with Freedom Communications and possibly several other newspaper companies." It cited an unnamed "person familiar with the matter," notes Denver Business Journal.

MediaNews Group is the minority partner in the GCI-controlled Detroit Media Partnership joint operating agency that publishes GCI's Detroit Free Press and MediaNews' Detroit News. The two companies also are partners in companies publishing newspapers in Northern California, Texas and Pennsylvania.

Detroit | Amid 'progress,' unions delay pact vote

The unions representing about 1,400 Detroit newspaper employees canceled yesterday's planned vote on a new contract, after reporting "significant progress" on talks over Gannett's demand for a 12% pay cut and other concessions.

"Instead," the Metropolitan Council of Newspaper Unions says in its latest update, "we intend to complete our work on tentative agreements and set a members’ meeting to vote on ratification of those tentative agreements on Sunday, Nov. 14."

The unions and Gannett negotiators had reached a stalemate two weeks ago over terms of a new three-year contract. In addition to the pay cut, GCI was seeking a two-year wage freeze, and potentially higher medical coverage costs, the labor groups say. The last contract expired Oct. 15, after reportedly being extended multiple times.

The negotiations cover about 1,400 employees of the GCI-owned Detroit Free Press; MediaNews Group's Detroit News, and the Detroit Media Partnership (DMP). The GCI-controlled DMP is a joint operating agency handling advertising, circulation and other business tasks for the two papers. The papers maintain separate, competitive newsrooms, however.

The talks come amid another recent drop in circulation at the Freep.

Weekday circulation plunged 9%, to 245,326, during the six months ended Sept. 30 from the same period a year before, new ABC figures out last week said. That was far worse than the average 5% decline for all dailies. Sunday, the most advertising-rich day of the week, was no better: The Freep's sales tumbled 11%, to 494,013, vs. an average 6.5%, according to the ABC.

Palm Springs | GCI reaches outside for new pub

Corporate has named a former MediaNews Group marketing and sales executive, Mark Winkler, as the new publisher of The Desert Sun in southern California's Palm Springs. He starts Sept. 27, and replaces Rich Ramhoff, whose departure was announced less than two weeks ago, after the paper reportedly missed advertising revenue targets.

In addition to running the Sun, Winkler will be a vice president in Gannett's regional West Group of newspapers, overseeing dailies in California's Visalia, Tulare, and Salinas, plus the U.S. territory of Guam.

Winkler, 50, was executive vice president, chief sales officer, and chief marketing officer for Denver-based MediaNews until March, when he left the company in a cost-saving shake-up after that newspaper publisher exited bankruptcy court, according to Westword.

MediaNews and Gannett are partners in the Detroit newspaper publishing business, as well as in a publishing partnership in California, Texas, New Mexico and Pennsylvania.

He is the second publisher Gannett has hired from outside the company this year; in late May, a former Boston Globe advertising executive was named chief executive of The Montgomery Advertiser.

Prior to MediaNews, Winkler was chief operating officer for Capital Securities Real Estate, a global real estate investments fund, according to a Gannett statement. From 2000-2006, he was a division vice president/general manager for Comcast Communications and from 2004-2006 had oversight of corporate interactive and new sales technologies for Comcast. From 1997-2000, he was a western region vice president for Media One of Los Angeles, Calif.

Winkler is a cum laude graduate of the University of California at Santa Barbara, the statement says.

His LinkedIn profile
How Winkler summarizes his background on the job network website:

Visionary leader that guides expeditious results and imparts a proven track record in the media industry, with profound proficiency in management, including sales, marketing, operations, and financial administration and oversight. Recognized for driving over $1 billion in annual revenue for traditional and innovative advertising media such as national, regional, and local spot cable and broadcast, digital media (content driven portals, E-commerce sites, SEM and SEO solutions), addressable advertising, digital publishing, print, niche publications, mobile, and e-mail marketing. Vast product and people knowledge and results orientation in revenue goal achievement, maximizing capital, and establishing efficient process for multiple product sales, both B2B and B2C. Significant understanding of the sales and marketing process as it relates a variety of vertical markets and a diverse client base. Demonstrated talent building consensus, fostering a passion for excellence, and igniting a competitive will in others that anything is possible. Energized by opportunities to help teams crystallize visions and propel business initiatives to exceed goals. Recognized as a positive change agent, with the ability to overcome all barriers and obstacles to successful and enhanced outcomes.

Related: the Sun's story about Winkler's appointment

AP: Detroit considered dropping print entirely

When Detroit newspaper executives did the math last year, they said they could have cut their costs about 40% by dropping print entirely, according to a new Associated Press story. "But they said that would have erased the more than 85% of their revenue that comes from subscriptions, newsstand sales and ads in the printed newspapers,'' the AP says. "Less than 15% of the newspapers' revenue had come from online ads."

Instead, executives at Gannett's Detroit Free Press and MediaNews Group's Detroit News said, cutting back home delivery to three days would reduce the newspapers' joint costs by about 20% while giving them the chance to keep most of their revenue, according to the AP's Michael Liedtke.

His account is the first I've read, giving details on the financial impact of dropping print altogether -- a scenario that common sense suggests they would have studied. Detroit's model is being closely watched across the newspaper industry, which could adopt the three-day delivery scenario at other newspapers.

The wire service's story continues: "The publications won't give detailed revenue figures, other than to say that Thursdays, Fridays and Sundays now account for 93% of the newspapers' print ad revenue. Even before the home-delivery cutback, those three days accounted for about 80% of the print ad revenue."

Related update: What Detroit's model could mean for USA Today, according to Central Michigan University journalism Professor John Hartman

Earlier: Freep adding iPhone app, more news. Plus: Retreating, Detroit papers resume 7-day delivery