Associated Press Will Decline in Wisconsin

Newspapers. Photo by flickr user Jon S. (CC BY 2.0)

Ironically, it was the AP itself that first broke the news: the Gannett and McClatchy newspaper chains “will stop using journalism from The Associated Press amid continued financial pressures for the news industry,” its story reported. “The AP was disappointed, considering there had been productive discussions with both news organizations, spokeswoman Lauren Easton said.”

“The news seemed to have caught the AP off guard,” Poynter reported. “We are shocked,” Easton admitted to the publication.

It’s all about slashing expenses for two national chains that face continuing financial issues. “With this decision, we will no longer pay millions for content that serves less than 1 percent of our readers,” said Kathy Vetter, McClatchy’s senior vice president of news and audience, in an internal email obtained by the New York Times.

And if it saves millions for McClatchey, it will save many times more that for Gannett, which has about seven times more daily newspapers than McClatchey.

The impact of this, both nationally and for Wisconsin, is huge. Nationally Gannett owns some 230 newspapers in 46 states, while McClatchey operates 33 daily newspapers in 14 states. That’s more than one-fifth of the approximately 1,200 daily newspapers in the country, which would all be dropping their AP coverage. Not to mention hundreds of weekly papers owned by the two companies that may also run AP stories.

In Wisconsin there is no McClatchy paper but 11 newspapers owned by Gannett, led by the Milwaukee Journal Sentinel. The others include The Green Bay Press-Gazette, Post-Crescent in Appleton, The Reporter in Fond du Lac, Herald Times Reporter in Manitowoc, The Northwestern in Oshkosh, The Sheboygan Press, Wausau Daily Herald, Stevens Point Journal, Marshfield News Herald and Wisconsin Rapids Tribune.

Speaking as someone who frequently reports on state issues, the AP coverage of the Capitol by Scott Bauer is invaluable. He is often the first to break stories and his reporting is incisive. “The AP has provided solid, objective coverage of state government for my more than four decades in Wisconsin journalism, providing core coverage for papers without Madison bureaus and supplementing those that did,” says Paul Fanlund, publisher of Madison’s Cap Times,” in a comment to Urban Milwaukee.

Both Gannett and McClatchey offered arrogant comments to their staff about AP. Besides Vetter’s comment that the AP serves only one percent of McClatchey’s readers, Gannett chief content officer Kristin Roberts wrote an internal memo obtained by The Wrap, which declared “We create more journalism every day than the AP.”

Both companies told their staff they will have no trouble replacing AP’s coverage. Gannett spokesperson Lark-Marie Antón released a statement saying “This decision enables us to invest further in our newsrooms and leverage our incredible USA TODAY Network of more than 200 newsrooms across the nation as well as USA TODAY to reach and engage more readers, viewers and listeners.”

But the two companies have been shrinking financially and cutting back staff for years. McClatchey struggled with debt for more than a decade after buying Knight Ridder for $4.5 billion in 2006 and filed for bankruptcy in 2020. It was bought by Chatham Asset Management, a New Jersey-based hedge fund, in a bankruptcy auction. The company has a history of slashing staff.

As for Gannett, “The scale of local news destruction in Gannett’s markets is astonishing,” as a March 2023 story by Nieman Lab was entitled. Since 2019, when Gannett merged with Gatehouse, in a deal that gave the latter majority control, the number of employees dropped from 24,338 to 11,000 at the end of 2022. “In other words, Gannett has eliminated more than half of its jobs in the United States in four years,” Nieman noted.

Gannett’s stable of 261 daily and 302 weekly newspapers in 2019 dropped to 217 dailies and 175 weekly newspapers by the end of 2019, a reduction of 171 total publications.

The idea that either company will be replacing the loss of AP coverage or doing anything but continuing to cut staff seems like a fantasy.

Meanwhile the AP is also claiming it won’t really be hurt by the loss of 263 daily newspapers and many weeklies dropping its coverage. “A loss of Gannett and McClatchy would not have a material impact on AP’s overall revenue,” Easton told Urban Milwaukee. “AP has diversified its services with the decline of newspapers and U.S. newspaper fees now constitute just over 10% of its annual income.”

Perhaps, but to quote from an AP story in 2017, the “Newspaper decline continues to weigh on AP earnings.” The AP’s total revenue dropped from a high of $748 million in 2008 to $556 million in 2016 and has been flat since then, with just $568 million in 2023. In real dollars that’s a drop of of $163 million in annual revenue since 2016. This is clearly a company that’s suffered declining revenue for years, and its own story traces that to “the decline of newspapers.”

Easton, however, told Urban Milwaukee that AP will make “no staffing changes in Wisconsin — it remains a top priority.”

I hope that’s true. And I wish the AP well. America’s democracy needs its reporting. But I must also note that the media companies, as a general rule, are very uninformative and often downright misleading when it comes to discussing their own business.