The bankruptcy of Freedom Communications, The Gazette’s parent company, closes one long-running story and, we hope, opens a new page.
Freedom, then a tiny chain wholly owned by company founder R.C. Hoiles, acquired the Gazette-Telegraph from local owners during 1946. As the Pikes Peak region grew and prospered, so did the newspaper, despite (or perhaps because of) a quirkily libertarian editorial stance.
During the last two decades of the 20th century, The Gazette enjoyed a spectacular run. The paper was powerful, influential, and clearly profitable.
A talented, energetic team of reporters, columnists, and editors made the “G” a must-read in the community. As a good newspaper should, the Gazette defined, celebrated, criticized and vigorously reported on the city. And during 1990, reporter Dave Curtin was awarded the Pulitzer Prize for feature writing.
But during the last few years, The Gazette and its parent have been afflicted by the same ills that have crippled so many media companies. Thanks to online competition and to the current recession, advertising revenue shrank dramatically, leading to equally dramatic cuts in the newsroom. The paper is less comprehensive, and much smaller than during its heyday.
During recent months it became clear to Freedom’s management and to the banks which hold the company’s debt that drastic restructuring would be necessary. The company could no longer service its outsized debt load of more than $1 billion, despite years of layoffs and cost-cutting.
What will happen to Freedom, and to The Gazette, is now up to the bankruptcy court, and to the banks which have become the effective owners of the company.
A restructured, relatively debt-free company might emerge from the ashes of Freedom. Existing creditors, having converted most of their debt into equity, might keep the new company intact, sell some its properties or liquidate it entirely.
Despite everything, we’d guess The Gazette is still profitable, especially if unburdened by corporate debt. It might be an attractive acquisition for a local investment group, or worth retaining in a slimmed-down successor corporation. In either case, the paper’s earnings can be expected to improve as the economy recovers.
The paper’s eventual new owners might make rapid and radical changes. Why not make a deal with Dean Singleton at the Denver Post to print the paper on the Post’s modern presses which, since the Rocky’s demise, are underutilized? Why not just abandon the aging, inefficient facility on Prospect Street, and move into leased office space? And finally, why not take some of that suddenly healthy cash flow and rebuild the editorial staff?
We compete with The Gazette, but we also recognize the vital role that a daily newspaper plays in a community, even during these changing times.
The Gazette has long fought the good fight, spending time and money on investigative reporting, and fiercely upholding the public’s right to know what local government officials often prefer to conceal.
A paper plagued by layoffs, furloughs and round after round of cost cutting cannot easily perform those functions.
We recognize that daily newspapers will never regain their once-dominant positions in the communities they serve. We suspect that within a few years The Gazette may devolve into a free Thursday-Sunday print publication, with a strong Web presence.
But for the immediate future, we hope that The Gazette might continue to report on and illuminate our city as it has for more than a century.
Good luck, guys!