Trib files for bankruptcy

[Ed Zotti]

Lest you think we at CL are the only ones in the media with problems:

http://www.chicagotribune.com/business/chi-081208tribune-bankruptcy,0,3718621.story

[leander]

Yes, it appears that paper media who used massive amounts of debt to fund over ambitious acquisitions are screwed, whereas well capitalised companies like Sunday Paper LLC are doing great, and will gobble up the poorly run media for a bargain.

[Ed Zotti]

The only Sunday Paper I'm familiar with is a weekly in Atlanta with a print circulation of 71K and a Web site drawing about 18K U.S. visitors per month. Is that the publication you mean? If yes, what leads you to think so highly of them?

[leander]

They seem to be doing something right.

http://www.sundaypaper.com/More/Archives/tabid/98/articleType/ArticleView/articleId/3400/Default.aspx

Sunday Paper Publishing, LLC plans to expand The Sunday Paper and Half Off Depot into the Charlotte, N.C., and Tampa, Fla., markets by May of 2009.

<snip>

So why now? One major factor is Creative Loafing’s filing for bankruptcy protection in September of this year. “While we planned to go to both of these markets in the next few years, the troubles of the parent company of the major newsweeklies in both cities have convinced us to accelerate our plans,” says Sunday Paper Publisher Patrick Best. “While we have a great deal of respect and admiration for the staff of the Creative Loafing newspapers in these markets, we don’t believe their parent company can provide them with the resources to be successful in the current economic climate. And we have the funding, the experience, the talent and the products to quickly be successful in these markets.”

One principal source of that funding is Brian Conley, owner of real estate development firm Cardinal Enterprises and the advertising agency Apollo Creative Group, both based in Knoxville, Tenn. Conley became a shareholder of Sunday Paper Publishing in 2007, the same year he sold the Knoxville newsweekly Metro Pulse and Knoxville magazine to the E.W. Scripps media company.

<snip>

Conley, who bought the money-losing Metro Pulse in 2003 and by 2007 had turned it into the most profitable (percentage to gross revenue) member of the Association of Alternative Newsweeklies, stresses that Sunday Paper Publishing’s expansion plans do not involve taking on debt.

“When papers lose their focus, and when a company’s debt exceeds its revenue, well, we just feel it’s an untenable situation,” Conley says. “That’s why we plan on expanding rapidly into these markets with equity rather than debt.”

<snip>

Obviously it's a terrible time for print media, but a poorly run business is going to suffer far more than a well run one. I wouldn't be surprised if you have a new boss come 2009.

[Ed Zotti]

I wouldn't be surprised if you have a new boss come 2009.I'll be happy to have a job at all, frankly. I also have to point out that, notwithstanding its ambitious plans, the Sunday Paper is a small operation, and trying to expand a media company has seldom been riskier than now. Look what happened to Tribune and CL. You may say: That's because the people at Tribune and CL are dopes who took on too much debt, whereas the folks running Sunday Paper are smart and will find equity investors, if there are any left. All I know is, the CL/Trib folks (Sam Zell!) thought they were pretty smart, too.

[leander]

I hope you have a job, too.

From the article it appears that Conley is the money man as well as someone with a track record of turning around a distressed paper. In my own business I have noticed that while some folks out there are really hurting, others are able to pick up a lot of businesses (or customer bases) for a bargain -- so long as they are cashed up. So it may be an ideal time to expand if you are able to control costs and not be overburden with debt.

The Trib I believe will get out of this simply because they have so many valuable assets. I'm not as confident about CL unfortunately.

[leander]

Also, if I might add --

In order for this SD Chicago thing to succeed I really think you need to bring in members from outside of the current SD database. I would hope the folks at CL are providing some space in the print version of the Reader to promote this site. Wouldn't be a bad idea to provide some editorial also, as most folks wouldn't know what this place is outside of your avg doper.

Finally, as a U of C grad I would suggest trying to market into those folks. Bright and slightly geeky abounds in Hyde Park!

[dropzone]

Not to the same extent as bright and EXTREMELY geeky!

[Cluricaun]

Not to the same extent as bright and EXTREMELY geeky!

Hey quit shining that light in my cave, I'm trying to work down here.

In the long run the Tribune company has plenty of real assets going for it beyond the beloved Cubbies. They've got WGN radio and television as well as a swell looking massive skyscraper in the heart of really expensive real estate. Hopefully these non-newspaper related endevors allow them to keep printing the Trib by offsetting any losses they might incur.

[Ed Zotti]

Also, if I might add --

In order for this SD Chicago thing to succeed I really think you need to bring in members from outside of the current SD database. I would hope the folks at CL are providing some space in the print version of the Reader to promote this site. Wouldn't be a bad idea to provide some editorial also, as most folks wouldn't know what this place is outside of your avg doper.

Finally, as a U of C grad I would suggest trying to market into those folks. Bright and slightly geeky abounds in Hyde Park!This is exactly what we're trying to do. We soft launched yesterday - if you click on the "Straight Dope" link on the Chicago Reader home page, it'll take you to the SD Chicago home page (which will feature regular SD columns plus Cecil's new SDC column plus interesting SDCMB threads). Some promotional things are in the works, and if all goes as planned some manifestation of Cecil's SDC column will begin appearing in the printed paper in January. So yes, expanding the user base is a key part of the plan.

[leander]

This is exactly what we're trying to do. We soft launched yesterday - if you click on the "Straight Dope" link on the Chicago Reader home page, it'll take you to the SD Chicago home page (which will feature regular SD columns plus Cecil's new SDC column plus interesting SDCMB threads). Some promotional things are in the works, and if all goes as planned some manifestation of Cecil's SDC column will begin appearing in the printed paper in January. So yes, expanding the user base is a key part of the plan.

That's great news. Hope it all goes very well. Funnily enough, reading these new boards makes me quite nostalgic for the old windy city (though I don't miss freezing my butt off!).

[CC]

That's great news. Hope it all goes very well. Funnily enough, reading these new boards makes me quite nostalgic for the old windy city (though I don't miss freezing my butt off!).
You'd hate it tonight. Check the weather.
Crap!:mad: I can't figure out why my ancestors emigrated here from the south.

[leander]

You'd hate it tonight. Check the weather.
Crap!:mad: I can't figure out why my ancestors emigrated here from the south.

Yikes -- just looked at the weather today. Stay safe and warm!

Also, an update (http://blogs.creativeloafing.com/politicalwhore/2008/12/18/eason-wins-one-in-creative-loafing-bankruptcy-case/):

Eason wins one in Creative Loafing bankruptcy case

Current Creative Loafing CEO and Chairman Ben Eason won a partial victory in federal bankruptcy court in Tampa today as Judge Caryl E. Delano refused to grant a motion by lender Atalaya to give it ownership of the company.

At a preliminary hearing this afternoon, Delano ruled that Creative Loafing’s reorganization plan should move forward and that it is too early to say that it can’t work. If it were nine months or more into the bankruptcy, Delano said from the bench, such a motion would be worth pursuing. “We’re three months into the case. I think the debtor should be provided a reasonable opportunity…. This case has been on a short string,” Delano told the parties in court. “The debtor has complied with those timetables” in producing a preliminary reorganization plan.

<snip>

Good news so far!

[Ed Zotti]

Yes, it's good news. I've been saying we need six months. If we get nine months, all the better.

[Markxxx]

Zell is a venture capitalist, he is only interested in the bottom line. This is why Obama was endorsed. Tribune which was in thick with the CW (and owned part of the WB) dumped the CW in San Diego for FOX. Tribune is also pulling emphasis on the CW from their local TV stations.

Till digital comes into play after Feb 17th we won't have a decent idea of what TV stations will hold. Basically after digital UHF and VHF will be equal. Virtual channel numbers will keep analog channel numbers. For instance WGN-TV will broadcast on channel 19, but the channel will still show up as channel 9.

So any affiliation changes will be based on trying to get a lower channel number. I'm not sure if that will be worth it. After digital is complete and the bugs worked out, the FCC may open up new allocations which may make TV stations worth less.