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Herald-Sun becomes a link in chain 

News of the Durham Herald-Sun's sale last week to Kentucky-based Paxton Media Group was met with some nostalgia, but little surprise, as our local media market follows the national trend toward consolidation. There aren't many locally owned newspapers left in the United States. Most are owned by chains and managed out-of-state. The News & Observer is one of 12 major metro daily newspapers owned by the McClatchy Corporation in Sacramento; The News & Record in Greensboro is one of 24 papers owned by Landmark Communications. The Fayetteville Observer is the only remaining independently owned metro newspaper in North Carolina with a circulation over 50,000.

But Paxton is hardly comparable to most newspaper chains. Of the 29 newspapers it owns, The Herald-Sun is the largest, with a circulation of 50,000. Its other papers have an average circulation of 30,000. It also owns more than 100 free and specialty publications and an NBC TV affiliate in its hometown of Paducah, Ky. And most of Paxton's papers are in small towns throughout the Southeast and Midwest where there is no competing publication.

McClatchy was negotiating to purchase The Herald-Sun; had they been successful, they would have had a lock on the Triangle newspaper market.

"Anytime a newspaper that was family-owned converts to corporate owned, there should be cause for concern," says Jock Lauterer, director of the Carolina Community Media Project at UNC's School of Journalism and Mass Communication. "A chain by its very nature is more interested in the bottom line than I think most independent owners will be," he says. "Make no mistake about it, things will change." But he says the paper's readers aren't likely to notice, at least at first. "I think you're more likely to see nothing right away, no changes at all." Management changes happen gradually, he says.

One thing didn't change with the announcement of the sale: the low profile of the Rollins family, which has owned the paper for 109 years. And there was little discussion of the historical role the Rollins' have played in Durham--unlike the attention paid to the Daniels family when they sold The N&O.

Chain ownership is more cost-effective in that it allows for a consolidation of resources. Paxton owns six other newspapers in North Carolina, including the nearby Daily Dispatch in Henderson and The Sanford Herald. Those papers could see some of their printing operations, production and other back-end operations consolidated.

The bigger question is, what will happen in the newsroom? Editorial operations are costly--they're the one part of the paper that spends money rather than earning it.

Again, Lauterer says we're unlikely to see dramatic changes. "In regards to newsroom fears, The Herald-Sun is a successful, profitable, going venture. If it ain't broke, why fix it? Why would Paxton come in with a wrecking ball and tear up a perfectly fine paper? I don't think that's going to happen," Lauterer says.

The Herald-Sun focuses on local coverage. So does Paxton's other papers, Lauterer says. "As newspaper chains go, they're one of the better ones," he says. "While they might be bottom-line oriented like any other group, they do profess to care about issues surrounding community involvement and civic life, what I generally refer to as community journalism."

The Herald-Sun's Orange County edition, The Chapel Hill Herald, is another costly branch of the media company. It is the dominant daily newspaper in that market, but is widely believed to operate at a loss and competes with the twice-weekly Chapel Hill News, owned by McClatchy. Lauterer says he thinks the Orange edition faces no danger. "I think Paxton would be crazy to abandon the market," he says. "If anything, they should come on stronger."

Years ago, Lauterer co-founded The Forest City Daily Courier in Forest City, N.C. Years after he had left the paper, his former partners sold it to Paxton. He said they increased circulation, ad rates, subscription price and undertook a redesign, ultimately making it a better paper.

Not all of Paxton's acquisitions in North Carolina have gone so smoothly, however. Its purchase of 50 percent of shares in The High Point Enterprise in 1999 led to a hostile partnership with Randall Terry, whose family had been part owners of the paper since the 1920s. Terry accused Paxton of trying to cut local content; Paxton sued Terry and co-director Charles Odom, claiming they mismanaged the paper's finances. After Terry died of cancer earlier this year, Paxton became sole owner of the Enterprise. In October, it shut down ESP, its entertainment weekly, laying off 20 people.

The Herald-Sun improved markedly after The News & Observer moved aggressively into the Durham and Orange county markets in 1993. But The N&O has been pulling back in the western Triangle as it intensifies its focus on Wake County and expansion into Johnston County. The Herald-Sun could take advantage of that retrenchment--but if Paxton reduces editorial spending, The N&O could seize that opportunity to move back into Durham and Chapel Hill.

In its written announcement of the Herald-Sun acquisition, company president David Paxton said he plans to continue the traditions of the E.T. Rollins family, which has owned the Herald since 1895. The Paxton chain has been owned by the same family for four generations and dates back to 1896. "Like the Herald Company, ours is a family-owned newspaper company. As we have grown we have sought to combine the best elements of local, family ownership with the advantages and operating efficiencies of a larger organization."

The new ownership goes into effect early next year.

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