The Journal Register Co. -- the parent company of the Saratogian and the Troy Record -- announced today that it's filing for bankruptcy. That prompted a WTF? moment for a lot of media people because JRC has already been through bankruptcy recently, emerging in 2009.
So, what's the deal?
John Paton -- the CEO of Digital First (the umbrella company that manages JRC -- yep, an umbrella company for a parent company) and "newspapers' digital apostle" -- posted today that bankruptcy "will have no impact on the day-to-day operation" and urged employees to keep doing what they're doing. He also explained some of the strategy for heading back to Chapter 11. The short story: the company is still being held back by "legacy obligations" -- so the private equity group that owns it is basically washing the company through bankruptcy so it can be sold, freed from many of those obligations, to a related entity.
Update: Romenesko has posted an email from JRC reporter with an understandably critical take on the situation.
Update: Poynter has gotten a hold of an FAQ memo sent out to JRC employees. Among the "unsustainable" legacy costs: defined benefit pensions. (Thanks, Bob)
Over at Nieman Lab, Josh Benton has a good explainer/speculation about the future for the situation. A clip:
Digital revenues are growing, but from an unspectacular base. Many of the company's initiatives seem, while interesting, unlikely to move the revenue needle much. Print revenues are a problem, just as they are at its peers. Today's release illustrates that JRC hasn't yet found the magic formula.
But could Paton's plan be a model for the local and regional newspaper industry as a whole, as some have dearly hoped?
Paton now will have his chance to prove it. In around 90 days, he'll have had his chance to shed the costs he wants to shed. No longer will "we were built for print" be a good excuse; if two bankruptcies can't clear out all those cobwebs, I'm not sure what could. "Digital first" will move from a slogan to a corporate name to a foundation of the company's business structure.
The underlying problem here -- as it is for most traditional media organizations -- is that the revenue generated from digital is nowhere to close what they'd been raking in from print/TV/old-school format. It's like trading dollars for dimes. And on top of that, there's new competition, not only from web-only upstarts -- one called
This is an extraordinarily interesting time for media. Unfortunately, it's the holy-crap-will-I-have-a-job-tomorrow/will-this-paper-exist-next-year kind of interesting.
image: Troy Record
We'd really like you to take part in the conversation here at All Over Albany. But we do have a few rules here. Don't worry, they're easy. The first: be kind. The second: treat everyone else with the same respect you'd like to see in return. Cool? Great, post away. Comments are moderated so it might take a little while for your comment to show up. Thanks for being patient.