Transcontinental/Chronicle Herald sale continues regional monopolization of newspapers

The Halifax Chronicle Herald surprised me this morning by announcing it is purchasing almost all of Transcontinental’s print assets in Atlantic Canada, including 27 newspapers, one online-only news outlet, and four of Transcon’s six printing plants. (This despite the fact that the paper is 15 months into a general strike.)

Included in the sale are newspapers like the St. John’s Telegram and Charlottetown Guardian. The sale takes effect immediately, Transcontinental said. No word on purchase price, but we’ll probably learn that at Transcontinental’s next financial report to shareholders.

This sale follows several recent region-wide newspaper selloffs, including Quebecor selling 74 community papers in Quebec to Transcontinental, Transcontinental selling its 13 Saskatchewan newspapers to Star News Publishing, Transcontinental buying all of Rogers’s business-to-business magazines, Gesca selling all its newspapers except La Presse, and swaps of newspapers between Black Press and Glacier Media in B.C. (Not to mention the whole Postmedia/Sun Media thing.)

The result of most of these transactions is that the country is being divided up regionally, and community newspapers are avoiding competition so much that their owners are swapping assets to stay away from each other’s markets.

After the Transcon/Chronicle Herald deal, the new owners (who have incorporated as Saltwire Network) made it clear they have no plans to expand into New Brunswick (beyond the purchased Sackville Tribune Post, which is on the Nova Scotia border) to avoid competing with the Irving-owned Brunswick News. The Transcontinental-Quebecor deal ended the companies’ competition in Quebec, which had heated up a few years earlier when Quebecor decided to launch some new publications on Transcontinental territory.

A look at which groups own more than a nominal number of newspapers in each province shows how fragmented it has become (numbers are based on a quick count and may not be exact):

  • British Columbia: Black Press (77), Glacier Media (25)
  • Alberta: Postmedia (36), Glacier Media (17), Black Press (12)
  • Saskatchewan: Glacier Media (15)
  • Manitoba: Glacier Media (9), Postmedia (9), FP Newspapers (9)
  • Ontario: Torstar (115), Postmedia (61)
  • Quebec: Transcontinental (100)
  • New Brunswick: Brunswick News (24)
  • Nova Scotia/Prince Edward Island/Newfoundland and Labrador: Saltwire Network (34)

Besides Alberta and Manitoba, no province has more than two major community newspaper publishers (as measured by number of titles). But just as importantly, no publisher operates substantial operations in more than four provinces.

As a result of the latest sale, Transcontinental will drop to being a Quebec-only newspaper publisher (except for papers in Cornwall, Ont., and its partnership in the Halifax Metro free daily).

The transactions make sense from a business perspective, and as much as we can complain about lack of competition, the truth is that healthy competition in community newspapers just isn’t possible as the industry continues its slow death march.

We may see further consolidation (particularly in western provinces) in the future, and if the situation doesn’t improve, major shutdowns. And if one of these companies goes under and is forced to shut down completely, it could leave an entire province without community media.

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