The agreement reached between Gannett and GateHouse Media to merge the two newspaper chains may have hit a snag, according to an article in the New York Post. The Post article says that the share price of New Media Investment Group, the holding company that controls GateHouse, took a 33 percent hit following the Monday announcement of the deal, sinking the value of the transaction from $1.38 billion to less than $1.2 billion. The Post also cites sources that claim the deal could be derailed if the two companies can not bolster shareholder support. If the deal stays on track, the combined company, which is to be run under the Gannett name, will be led by New Media chief executive Michael Reed. It will be based in the existing Gannett headquarters in McLean, Va. According to a report in the Wall Street Journal, the two parties to the deal said they expect to shed from $275 million to $300 million in expenses annually. The new Gannett would publish more than 260 daily newspapers and more than 300 weekly publications.
Facebook is looking to get into the video-on-demand game. According to Variety, the company is launching a test to sell subscription VOD services directly to users. The test, which will roll out over the next few weeks, is only available to U.S. users and will initially include BBC and ITV’s Brit Box, CollegeHumor’s Dropout, MotorTrend App and Tastemade Plus. Users will pay the same price for each of the services as other platforms are charging: $2.99 per month for Tastemade Plus, $4.99 each for MotorTrend App and Dropout, and $6.99 for BritBox. No traditional television channels or streamers such as Netflux or Hulu are part of the test. Facebook has not said whether or not it will take a cut of the revenue during the test period. The company is also working on its own set-top device that would connect users’ TV sets to their Facebook profiles.
At the New York Times, revenues are up—but profits are down. The New York Times Company reported on Aug. 7 that while its Q2 2019 revenue showed 5.2 percent growth over the same period in 2018, its operating profit slid to $37.9 million from last year’s $40 million. New York Times Co. chief executive Mark Thompson attributed the drop to “continued investment into growing our subscription business.” That investment looks to be paying off, since subscription revenue jumped 3.8 percent from the same period last year. On the advertising front, digital ad revenue was up, while print advertising showed a 8 percent drop. However, print ads still top digital ads in revenue, with print bringing in $62.7 million and digital racking up $58 million.