The sounds of silence: Postmedia buys Sun Newspaper chain and no one heard a thing

| April 6, 2015
Photo: Flickr/Ian Muttoo

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If a newspaper chain falls in the media forest, will anyone hear it?

On Wednesday, March 25 the competition bureau cleared the way for Postmedia to purchase all of Sun Media's print newspapers and digital properties. The $316 million-deal was the biggest media merger in recent history and put one company in charge of 175 Canadian newspapers, including both dailies in major cities such as Edmonton, Ottawa, Calgary and Vancouver.

Postmedia CEO Paul Godfrey gleefully admitted that ten years ago such a merger would not have been allowed and would likely have provoked a public outcry and calls for "another royal commission into the newspaper industry."

This time around, it sparked, well, nothing.

A review of the coverage of this event in media outlets including CBC, The National Post, The Globe and Mail, and the Toronto Sun revealed almost no critical commentary or even concern about the takeover.

In story after story, the deal was framed entirely as a business story, generally presented in a positive fashion (The Globe and Mail, and not surprisingly, the Toronto Sun, gave prominent play to Godfrey's snazzy Sun Media cufflinks).

In fact, most of the stories presented this massive concentration of media power into the hands of a single company as common sense, and inevitable. One Rotman School of Management professor said the decision just "made sense" noting there was no cause for concern among consumers since today anyone worried about things like "diversity of coverage and opinion" can simply find unlimited alternatives with a simple Google search, said Professor Ambarish Chandra.

"It's hard to believe this merger would have any adverse effect on consumers," he said.

Hard to believe? In fact, the takeover in itself is adverse to information seeking Canadians. It puts virtually every major newspaper (still the strongest and most effective engine of daily reporting in every city and town in which one exists) in the hands of one corporation. A corporation whose largest share holder is a giant, multinational hedge fund with little or no interest in quality journalism or the information needs of Canadians.

Golden Tree Asset Management's business model? It's a riff off the tried and true buy low, sell high. Golden Tree makes its money through the purchase of distressed companies whose assets are stripped and rationalized to ensure that the highly leveraged properties can repay the debt held by Golden Tree.

What does this mean? We've already seen it play out. Postmedia was created by Golden Tree in the wake of the hedge fund's purchase of the debt ridden CanWest chain. Since 2010, Postmedia staff have been slashed in half and assets sold off. The Parliament Hill bureau was shuttered in 2014. When CanWest bought out Southam News in 2000, their Parliamentary bureau was staffed with over 30 people. Since then, as reported by CTV, the bureau has been drastically reduced. Today, Postmedia says the chain now relies on the work of seven reporters and an editor from the Ottawa Citizen, and several national chain reporters and editors who cover politics.
We know where corporate consolidation leads.*

And Professor's Chandra's dreamy notion that local news and opinion is only a Google search away is pure fantasy. You can't search what doesn't exist. The responsibility for the vast majority of daily news coverage in cities and towns in this country falls to the local newspaper. And no one else. 

Reporting is work; and when you have fewer people working you have less news content. As more and more local news operations are "rationalized" to ensure Golden Tree's revenue flow the diversity of coverage and opinion goes nowhere but down.

Ironically, what Godfrey was gloating about -- the lack of outcry about the takeover -- and his unchallenged claims that it's good business and good for everyone is, we argue, symptomatic of the highly concentrated media landscape itself. This massive step toward further corporate concentration of media is normalized, viewed as both inevitable and good. But good for whom?

In the past, such mergers were carefully scrutinized and the concentration of control and the loss of diversity sparked widespread concern and debate. In fact, such changes sparked major investigations like the Davey Report of 1960 and later, the famous Kent Commission which was launched after two newspapers -- The Ottawa Journal and The Winnipeg Tribune -- were shuttered in the same week in 1980.

Today, they scarcely raise an eyebrow. There is virtually no mention of the impact of such moves on the public sphere, no debate on whether this will be good for readers and for citizens, for community and for democracy.

Only the Toronto Star story contained any critique and that was limited to a couple of comments buried deep in the copy. 

"Media mergers always raise concerns about loss of diversity, of editorial perspectives and fairness in news coverage due to the rationalization of news resources that are part of the reason for these mergers," Robert Hackett, professor of communication at Simon Fraser University, said in an interview in The Star.

Even Jeffrey Dvorkin who described the deal as "probably the least good outcome as far as the newspaper-reading public in Canada is concerned" called it virtually inevitable, saying the competition bureau, "had to allow it to happen."

Story after story contained claims that it was an exciting day for media and the deal offered benefits to advertisers. Almost incredibly, the competition bureau said their review showed "there would not be significant anti-competitive effects for readers or advertisers arising from the proposed transaction."

This in the face of the fact that Postmedia would own both dailies in four major cities in Canada. And this from a company well known for its cost-cutting and rationalization strategies that have led to layoffs in its newsrooms across the country and the centralization of much of its editorial production in one location in Hamilton, Ontario.

No, nothing to see here. Move along.


Paul Benedetti is a full-time faculty member in the Masters of Arts in Journalism Program at the University of Western Ontario.  He is the former Deputy Editor of, a site for Canadian journalists produced in co-operation with the Canadian Journalism Foundation. In 2010, he won a National Newspaper Award for Short Feature. He continues as J-Source Editor-at-Large and writes for various publications. 

James R. Compton is an associate professor in the faculty of information and media Studies at the University of Western Ontario. He is a former reporter/editor with the Canadian Press/Broadcast News wire service and member of the Digital Labour Group at Western, where he is the principal investigator of a SSHRC-funded study called "The Future of Organized Labour in the Digital Media Workplace.

* This paragraph original read: What does this mean? We've already seen it play out. Postmedia was created by Golden Tree in the wake of the hedge fund's purchase of the debt ridden CanWest chain. Since 2010, Postmedia staff have been slashed in half and assets sold off. The Parliament Hill bureau was shuttered in 2014. The entire Postmedia chain now relies on the work of four reporters from the Ottawa Citizen. We know where this leads.

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