News broke yesterday that the Tribune Company, owner of eight major dailies, 23 television stations, baseball team and Tribune Media Syndicate, filed for chapter 11 to protect it from creditors. The company owes $13 billion and has only $7.6 billion in assets. It hopes to sell it’s baseball franchise and Wrigley Field and other assets to generate cash to meet its debt obligations. The next principle payment is due next June at nearly $600 million. By filing chapter 11 now, it allows it to stay in business while it seeks better terms from its creditors.
Sam Zell, Tribune’s owner told employees through a memo that business goes on as usual.
Most importantly, I want to stress that we will continue to operate our business as usual. That includes meeting payroll and covering benefits (such as healthcare, disability and others), and paying vendors for all goods and services they provide to us going forward.
This filing should not impact the way you do your jobs on a day-to-day basis. We will continue to operate responsibly in a challenging environment â?? aggressively managing costs and maximizing revenue opportunities. These are all things we would do whether or not we were restructuring our debt.
In other grim media news, Newsday plans to eliminate 100 jobs and raise its newsstand price. Newsday is home to Walt Handelsman – a two time Pulitzer winner. No word on his job status. The Miami Herald is up for sale. Advertising Age estimates that in 2008, media companies (print, television, internet) have eliminated 30,000 jobs across the country or about 3.5% of its workforce.
A couple of Connecticut papers might be a bail out from their state government. Legislators are looking into offering low-interest loans or incentives to find buyers for Bristol Press and the New Britain Herald newspapers (along with 11 weeklies) which may close next month if a buyer is not found. The state does not want to become the owner of the papers but lawmakers see a need to preserve the jobs as well as protect the media from going under. Rep. Frank Nicastro understating the importance of media said, “Quite frankly and honestly, if it’s the newspaper today, what’s to say it won’t be the TV stations tomorrow?”
Somehow, I don’t believe we’ve hit bottom yet.