Hard times can be great times for predators. Prey animals slow down when they’re underfed, making them easier feed for the beasts who eat them.
What’s true for gazelles and lions is true for businesses as well. While small and mid-sized wildcatters have been caught in a squeeze between creditors’ demands and falling prices for oil and gas, their operations are being bought up on the cheap by an oligarchy of deeper-pocketed energy companies better able to ride out the slump. Industry consolidation, it’s called.
Trends already in motion before the Coronavirus pandemic crushed much of the global economy have speeded up the consolidation of retail business. As health-oriented lockdowns have shattered face-to-face, brick-and-mortar commerce, an online market dominated by Amazon, Apple and a few other mega-brand names has only accelerated its growth.
Economists can tell you why industry consolidation usually produces higher prices for lower quality goods. But they’re only talking about stuff – shoes and socks and oil wells.
When it comes to the sale of credible information, the news business, industry consolidation is in full swing and the damage being done to news professionals and news consumers is as dire and identifiable as it is predictable. To the lions of Gatehouse and its parent New Media Group, or Alden Global Capital, the people of the pressroom or the newsroom and the people who depend on them for information are mere springboks and antelopes, snacks to be bitten and chewed.
Rick Edmonds is media business analyst for the Poynter Institute where he has done research and writing for the last fifteen years. His commentary on the industry appears regularly on Poynter Online. He also was co-author of the newspaper chapter of the Pew Research Center’s State of the News Media report 2004 through 2014. He is frequently quoted in articles on newspaper economic issues and new business models and has provided comment in the Washington Post, Boston Globe and on numerous NPR reports. At Poynter he has helped coordinate conferences on emerging non-profit news alternatives, the future of advertising and developing user-generated content.