Bill Doskoch: Media, BPS*, Film, Minutiae

Curated knowledge, trenchant insights & witty bon mots

Summing up the Postmedia mess

Toronto Star columnist David Olive takes a tough look at the corporate basket case that is Postmedia and lays out some ownership models that might be more in the public interest.

From the Toronto Star (“The problem with Postmedia: Olive“):

The paucity of Postmedia asset sales, combined with the continued profitability of most of Postmedia’s papers, lends credibility to the current rumours that Postmedia is on a deliberate path to self-destruction.

That way, the U.S. hedge funds that have already reaped tens of millions of dollars from Postmedia in interest payments can get their hands on a bankrupt Postmedia’s real estate and other assets at fire-sale prices. As debt-holders, the hedgies will be at or near the front of the line of creditors in a bankruptcy proceeding.

To assist the asset-flipping Yanks, Postmedia is said to be lobbying Ottawa for a relaxation of Canadian ownership rules on cultural assets, since some of the deepest-pocketed bidders on a bankrupt Postmedia’s assets are likely to be foreigners.

There are alternatives more honourable than that outcome, by which genuine Canadian ownership is restored to newspapers that no longer have money sucked out of them but are reinvesting for a promising digital future.

  • Charitable or non-profit trust. Two of the world’s most-respected newspapers, the London-based sister national papers The Guardian and the Observer, are owned by a non-profit trust. This is also the model for the Tampa Bay Times, owned by the Poynter Institute for Media Studies, a non-profit journalism school. The Times tops its rival, The Tampa Tribune, in readership. And it has won 10 Pulitzer Prizes since 1964.
  • Government backstop. Ottawa (CBC), Ontario (TVO) and Alberta (Knowledge Network) have each launched public broadcasters, all of them in the front rank of journalistic quality. The federal and subnational governments have a role to play in funding non-profit trusts like those described above should any of the country’s 100-plus daily newspapers hit the wall.
  • Community ownership: As noted, many if not most small and mid-sized papers in Canada continue to be profitable. With the backing of Canada’s enormous pension funds, they could be acquired by local interests. Or perhaps by the entire community. The Super Bowl-winning Green Bay Packers (three championships) are owned by thousands of investor residents in Wisconsin, each permitted to hold just one share so that the team is assuredly community owned and can’t be sold to become a tycoon’s plaything.

Postmedia is giving private ownership of an essential public service a bad name. Its charade of pretending to operate its papers in the public interest cannot end soon enough.

Sat, January 30 2016 » Main Page, Media