‘The Men Who Are Killing America’s Newspapers’

For The Atlantic’s November issue, McKay Coppins reports on Alden Global Capital, the secretive hedge fund that controls more than 200 newspapers.

The Atlantic's November cover

Many people assume that local newspapers are dying because they haven’t been able to create a sustainable business model for the digital age, now that Facebook and Google command the advertising space. But that’s only part of the story. For The Atlantic’s November cover story, “The Men Who Are Killing America’s Newspapers,” staff writer McKay Coppins reports on the secretive hedge fund Alden Global Capital and its co-founders, Randall Smith and Heath Freeman, who have spent years gutting newsrooms and damaging democracy. “The Men Who Are Killing America’s Newspapers” is published today at The Atlantic, and is the cover story of The Atlantic’s November issue.

Coppins traces Alden’s rise, reporting new details on the two men who first began acquiring newspapers at the tail end of the Great Recession, and now control more than 200, including some of the country’s most influential: the Chicago Tribune, The Baltimore Sun, and the New York Daily News. Despite their influence, remarkably little is known about the septuagenarian recluse Smith and his 41-year-old protégé Freeman. Former Alden employees tell Coppins that the pair’s partnership seems to transcend business, with one calling it “a father-figure relationship.” Even as Alden’s portfolio grew over the years, Freeman rarely visited his newspapers. When he did, he displayed a casual contempt for journalists who worked at them. According to people who spoke with Coppins, on more than one occasion, Freeman asked aloud, “What do all these people do?”

According to industry experts Coppins interviewed for the story, Alden’s strategy for newspaper ownership is simple: gut the staff, sell the real estate, and jack up subscription prices while turning out a steadily worse product, indifferent to the subscribers it’s alienating in order to wring out as much cash as possible. One ex-publisher told Coppins that Freeman believed local newspapers should be treated like any other commodity in an extractive business. “To him, it’s the same as oil,” the ex-publisher said of Freeman. “Heath hopes the well never runs dry, but he’s going to keep pumping until it does. And everyone knows it’s going to run dry.”

Though famously reluctant to speak to the press, Freeman told Coppins that the papers Alden bought “were in many cases left for dead by local families not willing to make the tough but appropriate decisions to get these news organizations to sustainability”—a claim that ignores how many of the newspapers were profitable before they were purchased by Alden. As Coppins writes, “In truth, Freeman didn’t seem particularly interested in defending Alden’s reputation. When he agreed to the interview, I expected him to say the things he was supposed to say—that the layoffs and buyouts were necessary but tragic; that he held local journalism in the highest esteem; that he felt a sacred responsibility to steer these newspapers toward a robust future … but I had underestimated how little Alden’s founders care about their standing in the journalism world. For Freeman, newspapers are financial assets and nothing more—numbers to be rearranged on spreadsheets until they produce the maximum returns for investors.”

As Coppins writes: “This investment strategy does not come without social consequences. When a local  newspaper vanishes, research shows, it tends to correspond with lower voter turnout, increased polarization, and a general erosion of civic engagement.” At least one man, Stewart Bainum Jr., is quietly working to avoid that fate in Baltimore. After losing his bid for The Baltimore Sun to Alden, Coppins reports exclusively, Bainum is launching a new all-digital, nonprofit news outlet, The Baltimore Banner. Bainum told McKay that the Banner will launch with 50 journalists and an annual operating budget of $15 million, unprecedented for an outfit of its kind. The outlet will initially rely on philanthropic donations, though Bainum aims to sell enough subscriptions to make it self-sustaining within five years. While he’s aware of the risks, Bainum tells Coppins, “There’s no industry that I can think of more integral to a working democracy than the local-news business.”

The Men Who Are Killing America’s Newspapers” is published today at The Atlantic, and is the cover story of The Atlantic’s November issue.