A deal between Torstar Corp. and Postmedia Network Inc. to sell newspapers to each other and close them down is designed to reduce competition and win a bigger slice of a shrinking advertising and readership pie, critics said Monday.
Postmedia (TSX:PNC.A, TSX:PNC.B) announced it will cut 244 jobs as it plans to shutter 21 of the 22 community newspaper properties it is acquiring from Torstar as well as the Metro Winnipeg and Metro Ottawa free dailies.
Torstar91裸聊视频檚 Metroland Media Group Ltd., meanwhile, said it will close three of the seven daily newspapers in Ontario it91裸聊视频檚 buying from Postmedia as well as all eight community newspapers it91裸聊视频檚 purchased, resulting in the loss of 46 jobs.
Torstar (TSX:TS.B) said one job will disappear as it buys and closes the free dailies 24Hours Toronto and 24Hours Vancouver.
91裸聊视频淭he scale of it, I think, is stunning and will be stunning for people who live in these communities who are going to lose access to, really, their local news,91裸聊视频� said April Lindgren, an associate professor at the Ryerson School of Journalism.
More than 200 local news sources 91裸聊视频� newspapers, online publications and others 91裸聊视频� have closed for various reasons in Canada since 2008, she said, citing data she91裸聊视频檚 helped compile for the Local News Research Project.
91裸聊视频淲hat they91裸聊视频檙e doing is shutting down newspapers in their immediate environs so the circulation can be taken over and the news coverage can be expanded by their existing papers in the area,91裸聊视频� she said.
Lindgren said Postmedia, for instance, is shutting down Torstar newspapers in the coverage area of Postmedia91裸聊视频檚 Ottawa Citizen, and Torstar is buying and closing Postmedia products in southern Ontario that might compete with its Toronto Star.
The loss of local news titles will likely get worse, not better, as advertising dollars continue to migrate to online sites such as Facebook and Google, said Mitch Diamantopoulos, an associate journalism professor in the University of Regina.
91裸聊视频淎n attempt to cut costs by eliminating competition is bad news for Canadians,91裸聊视频� he said.
Diamantopoulos said the closing of free daily newspapers isn91裸聊视频檛 surprising because some were created to block competitors, not make money. The closings suggest their publishers no longer think that91裸聊视频檚 a necessary or affordable strategy, he said.
Media union CWA Canada demanded the federal government strengthen the Competition Act to prevent such deals, which it charged are designed to eliminate competition.
Postmedia said in a release the transaction requires no regulatory approvals and is not subject to the merger notification provisions of the Competition Act.
Another media union, Unifor, called on Heritage Minister Melanie Joly to address the crisis in the newspaper industry before more papers close.
In September, Joly said she would not 91裸聊视频渂ail out91裸聊视频� the industry by enacting urgent recommendations in a report from the Public Policy Forum to free up more funding sources for local newspapers.
91裸聊视频淲hat makes this particularly difficult is that it means we will say goodbye to many dedicated newspaper people,91裸聊视频� said Postmedia executive chairman and CEO Paul Godfrey in the statement on Monday.
91裸聊视频淗owever, the continuing costs of producing dozens of small community newspapers in these regions in the face of significantly declining advertising revenues means that most of these operations no longer have viable business models.91裸聊视频�
Metroland said the daily publications it will close are the Barrie Examiner, Orillia Packet & Times and Northumberland Today, while it expects to continue to publish the St. Catharines Standard, Niagara Falls Review, Welland Tribune and Peterborough Examiner.
91裸聊视频淭his transaction will allow us to operate more efficiently through increased geographic synergies in a number of our primary regions,91裸聊视频� Torstar CEO John Boynton said in a statement.
91裸聊视频淏y acquiring publications within or adjacent to our primary areas and selling publications outside our primary areas we will be able to put a greater focus on regions where we believe we can be more effective in serving both customers and clients.91裸聊视频�
The companies said the transaction is effectively a non-cash deal, as the consideration for the publications being purchased is roughly equal to that of the publications being sold.
91裸聊视频斺赌斺赌�
Torstar holds an investment in The Canadian Press as part of a joint agreement with a subsidiary of the Globe and Mail and the parent company of Montreal91裸聊视频檚 La Presse.
Dan Healing, The Canadian Press
