Postmedia's decision to lay off 90 people and merge newsrooms in four cities has raised concerns about how to keep media voices diverse as ownership becomes more concentrated.
On Tuesday, Postmedia announced the Sun and Province in Vancouver, the Herald and Sun in Calgary, the Journal and Sun in Edmonton, and the Citizen and Sun in Ottawa will share newsroom resources, but continue to publish as individual papers.
The formerly competing newspapers each lost journalists — 35 people in Edmonton, 25 in Calgary and 12 in Ottawa. The sports departments of all the newspapers were merged into a single national sports desk.
The papers in Calgary, Edmonton and Ottawa are to share a single editor, despite having been different publications, with distinctive styles of writing and approaching the news. The same reporters are to file for both papers in each city.
Nick Taylor-Vaisey, president of the Canadian Association of Journalists, said Canada is losing the diverse voices that have kept the media landscape interesting and helped bolster a healthy democracy.
Weakened coverage of communities
"No matter who you lose in a newsroom, you are sending a bad message to journalists," he told CBC News. "If you lose a senior journalist, you lose the institutional memory that can drive a story forward."
He pointed to the thousands of stories of interest to each of these communities that would be lost because there are not enough resources to cover them.
"These are stories that matter to readers in communities," Taylor-Vaisey said. "When you subtract thousands of stories from newspapers, from any medium, readers are going to notice, and that hurts."
The Canadian Association of Journalists has repeatedly expressed concern to the federal government as media become concentrated in fewer hands, he said.
"We did talk about this when Postmedia announced its intention to purchase the Sun papers," Taylor-Vaisey said. "We thought … and we were not alone in thinking, that it would lead to less media diversity and it would lead to fewer voices, fewer jobs and things like a merged newsroom."
Competition Bureau OK'd merger with Sun
When the federal Competition Bureau approved the purchase of Sun's English-language newspapers and digital operations last spring, it said the deal was "unlikely to substantially lessen or prevent competition."
In theory, the bureau had a year to step forward and challenge the deal — a period that ends this March.
At the time it bought the Sun, Postmedia said it planned to keep both newspapers operating independently in cities where Sun and Postmedia publications were in competition.
Paul Morse, president of Unifor Local 87-M — representing some of the Ottawa employees who were let go — has accused Postmedia of breaking that promise.
In a statement, the Communications Workers of America union's Canadian chapter called on the federal government to intervene with "legislation or regulations to limit concentration of media ownership."
Carleton University journalism professor Dwayne Winseck told CBC the Competition Bureau was foolish to allow the merger.
But Postmedia, like most newspapers, has been hard hit by falling ad revenues.
"The business model has been disrupted," Postmedia chief executive Paul Godfrey said on Tuesday.
"Our goal was trying to keep the newsrooms separate at the time, but with the continuation of the decline, we thought the important thing was to keep the newspapers open, and we figured out this was the best way to do it."
Poor revenue, heavy debt
It also is carrying a heavy debt load from buying the Sun chain. It lost more than $4 million in the quarter ended Nov. 30 and, according to the National Observer, was paying interest rates of 8½ per cent on the debt it owes to hedge funds. It has paid an estimated $340 million in interest payments since 2010, according to the Observer.
The hope in buying the Sun was that an expanded digital presence would bring in revenue from subscribers, through paywalls and other means.
But that model hasn't worked as well as many newspapers had hoped, according to Chris Waddell, a journalism professor at Carleton University in Ottawa.
"If you want to switch the audience from an advertising revenue base to a base of subscribers, the audience is generally not as well off as the audience of broadsheet newspapers, and it's more difficult to convert them to a paywall model online," he said.
Waddell points out that Postmedia may have further hurt its digital prospects by eliminating its potential to give diverse local coverage.
He says new digital media outlets are emerging as the traditional newspapers pull back, but they are not yet doing the job that newspapers do covering a broad range of local issues.
"At the moment the new entities aren't as large and don't have the same sort of staff as the ones under financial strain and that is reducing the amount of information available," Waddell said.
"It's reducing the amount of work that is being done to try to do what journalism has traditionally done, which is to try to hold people to account — to record what they say and then see whether they live up to what they say they were going to do."