Torstar, a media corporation that publishes the mildly progressive Toronto Star newspaper, has been sliding down the same financial razor blade as its largest competitor. Torstar lost about 85% of market capitalization in five years, a less disastrous result than the one experienced at Postmedia, where shareholder values fell essentially to zero.
This week, Torstar announced further downsizing, with 52 jobs lost. We can only wonder which of Canada’s newspapers will remain in five years time. Investors have already bailed, now the companies survive by selling tangible assets. When those are exhausted, liquidations will begin. This chart demonstrates Torstar’s financial decline:
Comedian and social commentator John Oliver did a segment on journalism for his HBO series Last Week Tonight:
Oliver’s work is both amusing and alarming. He places responsibility for the current state on both media managers and media consumers:
A big part of the blame for this industry’s decline is on us and our unwillingness to pay for the work journalists produce. We’ve just grown accustomed to getting our news for free. And the longer that we get something for free, the less willing we are to pay for it. …Sooner than later, we’re going to have pay for journalism, or we are all going to pay for it…
Writing at Nieman Lab, Ken Doctor expands on Oliver’s comments. He notes that New York times and Financial Times have had success in obtaining financial support from readers. Doctor believes those properties have delivered value and been smart about levying charges for content:
Most essentially, both still publish enough daily original reporting to maintain daily habits for subscribers. That’s the journalism that should be at the root of the journalism business. Both publications have seen cutbacks, but both maintain robust, experienced, and increasingly innovative newsrooms.
Compare that to the ungodly decline in numbers, knowledge, and know-how in so many regional newsrooms across the country. For most daily publishers, the business logic is counterintuitive — cut the news staff in half and charge twice as much for the remaining output — and consumers have responded understandably by walking away.
In British Columbia, we’ve seen corporate media with almost no interest in delivering value to readers. They divided markets to eliminate competition and made mutual support deals with governments to gain advertising, to avoid recycling fees and to redefine the term “Canadian-controlled.”
Newspapers sacrificed journalistic principles so that consumers cannot now be sure if they are are reading news reports or disguised advertising. Postmedia entered a formal partnership to promote the interests of the fossil fuel industry and downplay concerns about climate and the environment. They give broad coverage to Fraser Institute propaganda and no space to critics who identify the think tank’s financial sponsors and counter its defective research. Readers of In-Sights are aware of billions of public dollars flowing to gas companies and private power producers but the corporate media remains silent about those wealth transfers.
In other words, Paul Godfrey’s Vancouver newspapers are like Sheldon Adelson’s Las Vegas paper. Each of the properties care less about complete and accurate reporting than about manipulating public opinion to favour a financially privileged few.
Rather than improving the output and persuading news consumers to pay for content, media moguls aim to have the Trudeau Government bail out their news businesses. It will happen too because Liberals have always been willing to spend public money if private advantage was there to be gained.
Spin, wobble, collapse:
2011: John Cruickshank, Publisher of the Toronto Star and President of the Star Media Group, forged ahead with his dynamic transformation at the Toronto Star, leading it to new heights of editorial excellence.
2012: John Cruickshank …has provided great leadership as daily newspapers forge their way in a new digital era.
2013: John Cruickshank …carried on with the innovative transformation of operations at Canada’s largest newspaper.
2014: John Cruickshank continues to provide outstanding leadership through this period of significant transformation at the Toronto Star as it adapts and seeks out opportunities to capitalize on its audience-focused and multi-platform future. John’s leadership has been critical in building organizational momentum behind the new tablet initiative.
2015: John Cruickshank, the Publisher of the Toronto Star and President of Star Media Group, has announced he will be stepping down from his positions in May…
2016: John who?
Note: 2011 – 2015 from Torstar’s annual reports to shareholders.