Newspaper Publisher Emphasizes Technology

The publisher of the Chicago Tribune and Los Angeles Times appears to have kept the larger Gannett Co. from buying the publisher and has committed to making a major investment in technology as the foundation of the company. Tribune Publishing received an investment of more than $70 million from a Los Angeles investor and entrepreneur Patrick Soon-Shiong who was courted by the chairman of Tribune Publishing, Michael Ferro. Together they are the largest shareholders of Tribune Publishing, and appear to be able to block any attempts to sell the Tribune chain of newspapers to Gannett or any other buyers. American Graphics Institute provides InDesign training and Creative Cloud training to both Tribune and Gannett owned publications.

Soon-Shiong said they are “completely aligned in transforming the company from a newspaper company into a technology and content company.” This approach appears to mirror the thinking of Amazon founder Jeff Bezos who acquired the Washington Post newspaper last year. If technology is not able to transform the publication and news gathering, or Soon-Shiong doesn’t have the patience that has so far been necessary in pivoting news operations, then it remains possible Gannett may get a second chance in coming years. With two major shareholders from outside the news industry leading one of the largest newspaper publishing chains it provides an opportunity to explore fresh approaches to journalism in the digital age. Organizations such as the Knight Foundation continue to support efforts to keep news gathering and reporting relevant, even as traditional newsprint circulations decline. This effort at Tribune Publishing provides a larger scale experiment at transforming a news business from the top-down. Both Ferro and Soon-Shiong have experience investing in technology businesses, although this will be their first effort at a transformation of a news operation.

Ferro has only been the leading Tribune investor since February of this year. He invested $44 at the request of then CEO Griffin, who Ferro then quickly replaced with a business colleague of his. Soon-Shiong along with a group of other investors had expressed an interest in buying The Los Angeles Times several years ago, but that bid never materialized. One of his companies, NantWorks, provides technology used in healthcare industries, and Soon-Shiong indicates that its patents will be licensed to the Tribune Company. In an indication that the publications may include more video content, a related company NantStudio will be used for unspecified video production.

Soon-Shiong said an example of the technology available includes readers being able to hold a mobile phone over a news story and at the press of a button have related video content displayed. Speaking of the importance of becoming a technology and content company he said, “That’s the only way this entire industry can survive.”

By contrast, Gannett’s approach appeared to focus on an approach that larger-is-better, using size to drive efficiencies and removed duplications. This is what occurred with the Tampa - St. Petersburg Florida newspapers within the past month when they were merged. Yet Tribune is deciding to limit their size and is instead focused on using technology to drive their business.