Newspaper biz: Then and now | Arkansas Blog

Thursday, September 3, 2009

Newspaper biz: Then and now

Posted By on Thu, Sep 3, 2009 at 10:47 PM

It's just inside newspaper baseball, but I came across a 1995 article recounting the lawsuit in which the Walton family, with supporting fire from Democrat-Gazette publisher Walter Hussman, successfully fought the Stephens family's effort to dominate daily newspaper circulation in Northwest Arkansas by buying the Fayetteville newspaper to join its Morning News in Springdale.

Kind of interesting in light of current events.

The Waltons then owned the daily newspaper in Bentonville. In the years since, Hussman acquired the papers in Fayetteville and Bentonville papers and aggressively expanded his regional Democrat-Gazette.

A deal announced today by Hussman and Stephens would create a joint newspaper operation that will control 100 percent of the daily newspaper market in Washington and Benton counties.

From the way-back machine: Stephens argued that it wouldn't be anti-competitive for one ownership to own two newspapers in the area. The article went on:

One counterpoint is that if one newspaper dominates the entire market with 75 percent or more of the circulation then it becomes a "must buy" that advertisers cannot refuse to run in. If the must-buy publication raises its rates, advertisers usually make up for it by cutting back advertising with other media outlets.

The Times also pointed to various area weekly publications and other advertising media such as television, radio and direct mail as offsetting any anti-competitive effects the sale might have. In addition, the Times argued that the Democrat-Gazette planned to begin publishing a zoned edition for northwest Arkansas, further increasing competition. Hussman and Democrat-Gazette General Manager Paul Smith both said the newspaper would not begin a zoned edition if the sale went through.

"That would give one owner ... 75 percent of the daily circulation in northwest Arkansas, and we would not be interested in going into a market where one newspaper had 75 percent of it whether it was northwest Arkansas or anywhere else in the country," Hussman said.

We soon shall see how that particular market works with 100 percent ownership by one company. The federal Justice Department once looked askance at such. But times have changed for newspapers.

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