Postmedia cuts 90 jobs, merges newsrooms in Vancouver, Edmonton, Calgary, Ottawa

Newspaper chain Postmedia announces sweeping changes to its operations, cutting 90 jobs across the country and merging newsrooms from multiple papers into one each in Vancouver, Calgary, Edmonton and Ottawa.

'We will continue to operate separate brands in each of these markets,' CEO Paul Godfrey says

Carolyn Dunn explains why Postmedia is combining newsrooms in four cities, cutting 90 jobs 2:00

Newspaper chain Postmedia today announced sweeping changes to its operations, cutting 90 jobs across the country and merging newsrooms from multiple newspapers into one each in Vancouver, Calgary, Edmonton and Ottawa.

"We will continue to operate separate brands in each of these markets," Postmedia CEO and president Paul Godfrey said in a memo to staff Tuesday afternoon. "What is changing is how we produce these products."

The chain says two papers in those markets — 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 operate.

"Each city will have one newsroom," Godfrey said, and the two papers will be run by one editorial team.

At least 90 editorial jobs are being cut as a result of the process.

They partially break down as follows:

  • 35 in Edmonton.
  • 25 in Calgary.
  • 12 in Ottawa.
  • 5 at the National Post.

"We will also be introducing a buyout program in the Vancouver and Ottawa newsrooms as part of this one newsroom initiative," the memo said.

The chain's two Toronto-based newspapers — the Toronto Sun and National Post — will remain separate.

But the chain is centralizing its entire sports coverage through one desk based in Toronto, which will lead to some sports-related layoffs at the Toronto-based National Post.

Many of those affected took to Twitter to confirm they had lost their jobs.

Postmedia's finances have been sagging for several quarters under a large debt load, much of which was accrued when the company bought the entire Sun chain of newspapers from Quebecor in late 2014 for $316 million.

That move consolidated most of the English-language newspapers in Canada under the Postmedia banner, with the notable exception of the Toronto Star and the Globe And Mail.

"This is an enormous concentration of media control into a few hands," said Unifor president Jerry Dias. "Centralized news gathering and opinions, including in local news, do not add to the national debate that helps build a functioning democracy."

"With each quieted voice, our democracy suffers."

According to the company's latest quarterly earnings report, Postmedia has almost $700 million in debt on its books, and the company is now a penny stock — worth 15 cents a share on the TSX. In 2011, Postmedia was valued at more than $17 per share.

The company says it plans to cut costs by $80 million by the end of next year, up from a forecast of $50 million last quarter.

Postmedia's problems appear to have worsened since then. "Postmedia's problems are much deeper," Carleton University journalism professor Chris Waddell said. "Print advertising revenue is down 17 per cent year over year, while digital ads and subscription revenue are down by five or six per cent," he said.

A big problem for the chain, Waddell noted, is that Postmedia paid for the Sun Media purchase with debt loaned by U.S. backers. Those debts must now be repaid at a time when the Canadian dollar is worth much less, which means it costs more money to repay at a time when the chain has less cash overall.

"This is an organization that is losing money and losing a lot of money," Waddell said.

Canada's Competition Bureau gave its OK to the deal the following May, saying at the time the merger "is unlikely to substantially lessen or prevent competition."

On Tuesday, the bureau said the new plans aren't a good reason to re-examine the deal. "Subsequent business decisions of Postmedia related to its acquired assets such as the announced job cuts are not generally cause for the bureau to re-examine the transaction," a spokesman told CBC News.

With files from The Canadian Press

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