A News Comment: What does the McClatchy bankruptcy really mean?

When The Hill, a website based in Washington, D.C. and focused on politics, policy, business and international relations, broke the news to early risers last Thursday morning that McClatchy, the nation’s second-largest newspaper company, had filed for bankruptcy under Chapter 11, the ground shook underneath newspaper offices, large and small, across America even though insiders had suspected for weeks that news was coming.

McClatchy owns some of the most prominent local and state-wide newspapers in America. Closer to home, it owns The State newspaper, The Charlotte Observer, The Rock Hill Herald and other South Carolina dailies and weeklies.

The story went on to say that, “If a bankruptcy court accepts the Chapter 11 plan, then McClatchy would likely be led by hedge fund Chatham Asset Management LLC. McClatchy, a publicly traded company, would become a private company as a result.”

What does that mean for local newspapers?

“When local media suffers in the face of industry challenges, communities suffer, polarization grows, civic connections fray and borrowing costs rise for local governments,” W Craig Forman, president and CEO of McClatchy was quoted in The Hill story

Last year, New York Times Executive Editor Dean Baquet made the ominous prediction about local newspapers.

“The greatest crisis in American journalism is the death of local news,” Baquet said at the International News Media Association World Congress in New York City, and quoted in The Hill. “I don’t know what the answer is. Their economic model is gone. I think most local newspapers in America are going to die in the next five years, except for the ones that have been bought by a local billionaire,” Baquet continued.

“I think that everybody who cares about news — myself included, and all of you — should take this on as an issue,” he added. “Because we’re going to wake up one day and there are going to be entire states with no journalism or with little tiny pockets of journalism.”