Is Hometown Ownership Really the Next Big Thing?

IS HOMETOWN OWNERSHIP REALLY THE NEXT BIG THING?
[SOURCE: Editor&Publisher, AUTHOR: Mark Fitzgerald and Jennifer Saba]
There may be nothing new under the sun, but the sudden widespread clamor to return troubled newspapers to local ownership -- after decades of relentless industry consolidation -- at least represents a dramatic change in course. Among industry experts, opinion is growing that this phenomenon might just have legs. "My personal belief is that it's the start of a trend -- and that the trend is going to continue," says Scott Stawski, senior principal at Knightsbridge Solutions. Just a year ago, the idea that local investors would line up around the block for the chance to buy a metro daily seemed as unlikely as the idea that big chains like Knight Ridder or Tribune Co. would be forced to put them up for sale in the first place. The tipping point for the local ownership boomlet surely came this spring when the McClatchy Co. immediately hung "for sale" signs on 12 dailies it acquired in its purchase of Knight Ridder. Yet moving from chain ownership to local ownership remains rare. "When that does happen, typically it's because the chain has screwed up [the paper] so badly it has to dump it," says one broker who insisted on anonymity. That's because if a property were hot, potential local buyers wouldn't have a fighting chance. "Generally you will find that if something is attractive, the newspaper groups will be able to outbid everyone else, including private equity funds," says Robert Broadwater, founder of investment firm Broadwater & Associates.
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