First-movers and industry shakeups: How public newspapers define value

Abstract

With profitability for newspapers waning, publications are seeking new investments to bolster their bottom lines. At the same time, newspaper executives are experiencing pressures to generate new value from “first-mover advantages”—the company’s uptake of new products, processes, or markets. This research examines 4 years of 10-K filings from a sample of the United States’ publicly owned newspapers, finding that corporate newspapers expanded notions of value to encompass the impact of their newsgathering operations.

Keywords

newspaper chains public ownership strategy

Historically, the investment community in the United States has viewed newspapers as “cash cows” that yielded consistent and reliable returns (Soloski, 2019, p. 159). Sustaining this level of profitability in the digital age has become a challenging feat for public newspaper companies, however. Numerous newsprint properties have folded entirely (Soloski, 2019). The remaining survivors have sought out cost-containment strategies to neutralize their hemorrhaging bottom lines—most visibly witnessed in the endless rounds of downsizing that have decimated reporting staffs nationwide (Usher, 2010). Strategic mergers and acquisitions—particularly the $1.4 billion union of GateHouse and Gannett newspaper properties announced in mid-2019 (Arbel, 2019) and completed later that year—have further reshaped the media landscape through the formation of 21st-century corporate mega-chains (Soloski, 2015). While lay investors purchase stock in newspaper companies, the majority of shares are held by large-scale, institutional investors (Soloski, 2019). Under this structure, tradeoffs exist. Even though these companies have broader access to larger amounts of capital, they often bear a heavy burden to return a profit in hopes of satisfying investors (Picard & Van Weezel, 2008).

In addition to navigating these financial constraints, newspaper company executives are increasingly pressed to innovate their business processes. Given digital disruptions of how consumers obtain and share news (Poindexter, 2016), these companies are diversifying their energies into developing new products and business models—yielding new streams of revenue. To this end, American newspapers have launched a costly, everything-but-the-kitchen-sink approach to innovation—testing and prototyping new modes of content production, delivery, and engagement to (re)capture elusive audiences (Lehtisaari et al., 2018). Across all industries, firms historically have sought to obtain a “first-mover advantage” around innovation—racing toward experimental opportunities before their competitors arrive to them (Kerin et al., 1992). A tension exists, however, in that newspapers traditionally have been risk-averse operations (Sylvie, 2018). As a result, a push–pull dynamic has emerged between shareholder demands to provide return on investment and institutional take-up of growth opportunities that can create new value (Sylvie, 2018). To date, newspaper executives have generally communicated value through a financial lens—most visibly in annual reports. Journalists, on the contrary, have tended to see the utility of news in a different light. To practitioners, news production has largely carried value for the impact that stories can possess within their local communities (Powers, 2018). In either definition, failure to demonstrate the value of investing in the news can potentially restrict the amount of working capital to fuel business operations. With the high costs of internal innovation in the news industry today, such infusions of capital are incredibly precious.

Given the beleaguered business of newspapers as we enter the early 2020s, are newspaper executives expanding how they define value in efforts to sustain and stimulate heightened financial investment in the news? More specifically, do today’s C-suite occupants within public newspaper companies envision the value derived from journalistic production as a commodity, a civic good, or as a combination of the two elements? Defining and creating value remains a central consideration of the business model crisis for newspapers at this decade’s start. To date, academic scholarship has not fully explored how—in today’s era of financial flux—company executives are qualitatively presenting this argument, though. Addressing this gap in the literature, this study probes how newspaper company executives define value for their respective journalism organizations, as presented in public 10-K U.S. Securities and Exchange Commission filings produced by a sample of the nation’s public newspapers. This research concludes that newspaper companies in the late 2010s expanded how they define value to encompass the journalistic mission powering their newsgathering operations.

News Investment as a Value Proposition

Value, defined in the context of journalistic production, is “founded on the concept of worth, that something is useful, that it has importance, and that it can be used in an exchange” (Picard, 2006, p. 45). Newspaper companies have traditionally characterized value in economic terms, as financial gains or losses (Picard, 2006). In the last two decades, this economic notion of value for the newspaper industry has plummeted. Between 2004 and 2009, stock prices for the nation’s publicly traded newspaper companies nosedived, collectively shedding 87.4% in market value (Soloski, 2015). In the 2010s, the bottom lines of these firms continued to sag (Barthel, 2019). While newsprint circulation levels remained relatively flat during 2016–2017, newspaper advertising revenues (both legacy and digital) declined by 10% in that period (Pew Research Center, 2019).

The financial freefall of publicly traded newspaper companies can be predominantly traced to drastic alterations in how audiences obtain news—and more importantly, if and how they pay for it (Arrese, 2016). Given the current condition of “market failure” across the newspaper industry (Benson, 2018, p. 1067), corporate newspapers have been scrambling to identify new business models that can create new forms of economic value (Grueskin et al., 2011). In the 2010s, newspapers tried to bolster their bottom lines by launching paywalls (Pickard & Williams, 2014) or by creating premium access portals that offer niche content (Machin & Niblock, 2010), for instance. Other legacy print corporations have poured investment dollars into digital-native news startups (Kosterich & Weber, 2018). News outlets have even crowdfunded financial support from the audience itself (Jian & Usher, 2014). Unilaterally, none of these efforts (to date) has emerged as a solid and sustainable solution. Moving into the early 2020s, the economic value of news appears to be continuing its downward slide.

Journalists populating newspapers—on the contrary—have historically tended to view the concept of value differently than their C-suite colleagues. Through the process of newsroom socialization, newsworkers have developed a set of shared practices and ideals that guide the process of manufacturing news, including how the product they create is valued both internally and externally (Singer, 2004). Owing to the long-standing “wall” within newsrooms that separates the editorial and financial departments, newsroom practitioners do not regularly interface with the business side of the operation (Achtenhagen & Raviola, 2009). Strategic planning within newsrooms has typically been the province of editors and publishers, who are largely removed from the day-to-day workflows of rank-and-file reporters (Sylvie & Gade, 2009). Traditionally, newspaper company personnel have struggled in thinking tactically about industry innovation because the temporal cycles of news demand up-to-the-moment attention (Bressers, 2006). Adding even greater organizational complexity, senior managers generally are not the same individuals who own the publications (Picard & Van Weezel, 2008). In the aggregate, these structural divides interplay with how newsworkers think about the organization and its profitability (Sylvie, 2018). While journalists are not entirely blind to the financial health of their employers (newsroom staff downsizing is a notable exception), practitioners have been more attuned to the day-to-day demands of producing news rather than actively weighing how it is monetized (Sylvie, 2018). In conceptualizing value, newsroom practitioners have routinely accentuated journalism’s civic good over its commodity price (Willis, 1988). To practitioners, value can be conveyed as impact, measured by the “outcomes of journalistic work, such as increasing audience knowledge, spurring conversation, or changing policy” (Powers, 2018, p. 454). Simply stated, journalists have largely framed the value of their work around the impact it creates (Powers, 2018).

Differing visions of how senior managers and how newsroom practitioners conceive of value may be converging, however. Given the entry of philanthropic foundations in the early-to-mid 2010s, which are providing a much-needed infusion of capital for local American newsrooms (Scott et al., 2019), the notion of value-as-impact now increasingly interplays with economic, bottom-line performance assessments (Benson, 2018). These funders routinely seek documentation of how their donations have catalyzed broader, community-based results (Konieczna, 2018). In the late 2010s, foundations tended to favor newsroom projects that quantified acts of “engaged journalism,” or the improvement of community relations between news producers and consumers (Ferrucci & Nelson, 2019, p. 48). Impact can also be measured through the story’s reach, or the number of digital views that the news product garners within the community (Benson, 2018). Beyond philanthropic circles, newsrooms have also turned to donor support generated from the audience itself (Aitamurto, 2019). In deciding whether to financially back a local publication, crowdfunded financing often hinges upon whether audience members conceive that the newsroom project carries positive impact within their community (Jian & Shin, 2015). Taken together, these new avenues of financial support indicate an evolving business model that now undergirds journalistic production (Nelson, 2019). Scholars, however, have yet to fully uncover how these structural shifts interplay with conceptualizations of value.

Landing an investment for news often means that newspaper executives must next grapple with resource allocation, in efforts to create new value. In the late 2010s, editors and publishers possessed a dizzying array of resource-intensive production strategies (such as automated reporting, artificial intelligence/machine learning, augmented/virtual reality, and data journalism, just to name a few) that can become new potential sources of revenue and also require significant upfront investment. Journalists within news organizations actively advocate pursuing such entrepreneurial approaches to newswork (Vos & Singer, 2016). Newspapers that vocally champion innovation also attract industry acclaim and accolades, as well as attention from the philanthropic community, which can iteratively generate more capital for the business (Creech & Nadler, 2018). In this bewildering quest to integrate new revenue streams into day-to-day practice, newspaper executives have reported feeling paramount pressure to be first-to-market with innovative ideas (Sylvie, 2018).

The Pressure and Risks of Being a “First-Mover”

Accruing value (as evidenced by management and economics scholars) can also be used as a strategic, competitive advantage to edge out rivals (Adner & Kapoor, 2010). More specifically, companies—including newspapers—can seek to secure a “first-mover advantage,” or a “competitive head start over rivals” when developing a new product, articulating a new process to make the product and/or establishing a new market entirely before their competitors do (Kerin et al., 1992, p. 33). Because of environmental or technological changes, the firm is uniquely positioned to capitalize on the innovation—provided that the company has effective leadership and Research & Development efforts in place to effectively incubate the initial experiment (Lieberman & Montgomery, 1988). Ideally, the first-mover advantage should align with existing strategic priorities of the firm (Tetrault Sirsly & Lamertz, 2008). Historically, industries that have secured significant first-mover advantages—such as pharmaceuticals (VanderWerf & Mahon, 1997), automobiles (Monteverde & Teece, 1982) and airlines (Smith et al., 1991)—typically also had steep barriers to entry for their competitors (Kerin et al., 1992). By leveraging their scale and by beating the competition into the new space, incumbents can become well-known among consumers, who develop loyalty to their innovation and, in turn, to the business itself (Lieberman & Montgomery, 1988). In the journalism industry, newspapers have applied this first-mover approach to cultivate brand prestige as industry pioneers (Huang & Sylvie, 2010).

The race to bring an innovation to market first is encumbered with numerous risks, though (Robinson & Min, 2002). Before expanding into new spaces of revenue generation, firms must first consider if they have the necessary in-house skills to successfully pivot their businesses into new directions (Kerin et al., 1992). First-mover status rarely endures permanently. In the transition to the new opportunity, corporations often fall short because of unforeseen environmental variables (Kerin et al., 1992). Competitors may subsequently enter the market or simply free ride on the innovator’s progress (Lieberman & Montgomery, 1988). In other cases, the original instability that enabled the opportunity ultimately resolves itself with industry-wide technological progress (Lieberman & Montgomery, 1988). Long-term success generally requires significant recalibration of the company’s operations (Lieberman & Montgomery, 1988).

To date, newspaper companies have been widely characterized as risk-averse, wary of taking the bold leaps of faith required to become first-movers (Sylvie, 2018). The newspaper industry, in its migration from print to digital, had a textbook first-mover opportunity on their hands. However, most American newspapers leapfrogged from newsprint to the web with little consideration as to whether providing free content online could prove a permanent, sustainable business model (Bressers, 2006). Technological change, as exhibited in this platform transition from print to digital, can efface competitive advantage within a company or across an industry, thereby redefining how value is acquired and assessed (Afuah, 2000). Prior research has suggested that rather than innovating as first-movers, the majority of newspapers in the digital age have been more likely to imitate the approaches of their competitors (Mierzejewska et al., 2017). The few firms who were the first to agilely shift toward converged newsrooms that monetized digital-only content were rewarded with increases in online advertising revenues, subscriber volumes and pageviews, however (Pavlik, 2013).

To pursue first-mover advantages, corporate leadership must weigh the potential value of the prospective innovations, while mitigating the inherent risk. If they are unable to convince investors to come and take the leap, executives may encounter difficulties in securing sufficient financing to not only sustain the operating costs behind day-to-day production but also to innovate into new arenas of revenue generation. Given the entrepreneurial culture of modern newsrooms (Vos & Singer, 2016), in which teams are inclined toward experimenting with new modes of crafting content, delivering information and engaging audiences, acquiring such investments stands essential to funding the resource-intensive operation of newsgathering today. Companies—including the newspaper industry—must first convince shareholders that return exists for their investment. Firms actively bridge this knowledge gap through the targeted outreach of investor relations—communications designed to convey their company’s value to current and potential shareholders (Laskin, 2009).

Communicating Value to Investors

Historically, a firm’s financial disclosures were written for an insider audience of savvy readers, in efforts to persuade them to invest in the company (Parker, 1982). In the late 20th century, companies began dedicating more resources to investor relations targeting broader and wider audiences (David, 2001; Lord, 2002). Following Enron’s corporate collapse at the turn of the 21st century, accounting oversight from the U.S. Securities and Exchange Commission (SEC) significantly expanded (Cohen et al., 2010). Passed by Congress in 2002, the Sarbanes-Oxley Act mandates that publicly traded companies must be subject to more rigorous, verifiable audit procedures, as well as submit more extensive regulatory filings with the SEC (Cohen et al., 2010). In efforts to restore shareholder confidence on Main Street post-Enron, today these documents—particularly annual 10-K filings—must be written in plain language that can be more accessible to the general public (Cohen et al., 2010). According to the SEC, annual 10-K filings submitted by corporate leadership act to “provide a comprehensive overview of the company’s business and financial condition” (U.S. SEC, 2009). Companies routinely pair these required SEC documents with annual reports that resemble glossy magazines—replete with photos, graphs, charts, and pull quotes—that help tell the company’s “story” through its culture, values, and history (David, 2001, p. 207). Corporate leaders use these documents (SEC filings and annual reports) both to contextualize past events and to justify corporate decision-making (Jones et al., 2017). Companies that are financially imperiled tend to take a more futuristic approach in their narratives, prioritizing the potential of forward-looking ventures, instead of discussing past failures (Kohut & Segars, 1992).

To date, few studies have fully examined how corporate newspapers define and communicate value. The limited number of prior works focused on the newspaper industry and its economic health have probed profitability largely through a quantitative perspective, looking exclusively at revenue generation (Edge, 2014; Grueskin et al., 2011). Little scholarship has used public documents, such as 10-Ks, to probe conceptualizations of value. While Cawley (2019) explored the newspaper industry’s annual reports as narratives, the study was limited to newsprint publications in the United Kingdom. Cawley (2019) found that “recognition of news’s societal value, as a positive externality, was weakly embedded in the reports” as newspapers transitioned from print to digital (1043). The study’s data, however, are drawn from the early 2000s and 2010s—a time period predating the entry of alternate sources of funding for journalism, such as foundation or crowdsourced support, that often prioritize value as impact. Filling this gap in the literature, this study identifies how a sample of American public newspapers talk about the value they create. A primary research question guided the study’s design, data collection, and analysis:

Research Question 1:How do American public newspaper companies define value for shareholders?

Study Design and Methods

To better understand how investment in the news is presented as a value proposition, this study examines Form 10-K U.S. SEC filings (hereafter referred to as 10-Ks) of selected American public newspaper companies across a 4-year period, spanning 2015 to 2018. Examining several years of public, financial documentation for these companies enabled the researcher to understand how value has been longitudinally presented by the firms. This study’s sampling frame is drawn from the SEC’s Electronic Data Gathering and Analysis Retrieval (EDGAR) database. As of Spring 2019, the regulatory agency classified 95 publicly traded companies in the database as “newspapers: publishing or publishing & printing” businesses. From this sampling frame, the researcher first eliminated from analysis companies that were no longer considered active (as of Spring 2019). The researcher then eliminated companies that primarily printed specialized publications (such as law/business journals or niche financial news), as well as companies with significant global subsidiaries and/or extensive international newsprint properties. As a result, this study’s sample encompasses 10-Ks from seven firms, including: A. H. Belo Corporation; Gannett Co., Inc.; Lee Enterprises, Inc. The McClatchy Company; New Media Investment Group Inc (holding company for GateHouse Media Inc.); The New York Times Company, and Tribune Publishing Company. (It should be noted that Tribune Publishing, during the study’s content capture period, was briefly rebranded as Tronc, Inc. For consistency and clarity, this company is referred to as “Tribune Publishing Company” throughout this study’s narrative). In total, this study encompasses 28 SEC filings. In reviewing the 10-K filings (on average = 127.14 pages, SD = 31.38), specific attention was dedicated to Part I of the 10-K filing, which delineates the business operations (Item 1), risk factors (Item 1A), and properties of the firm (Item 2). Collectively, this section is often referred to by company executives as the “Management Discussion and Analysis” or MD&A portion (Bodnaruk et al., 2015). This section was selected for analysis because it is largely written in narrative, whereas other portions of the 10-K rely most heavily upon quantitative assessments of financial performance. Analyzing the risk factors contained in the MD&A, in particular, can help identify how and to what degree newspaper companies are pivoting toward new conceptualizations of value. For the newspaper companies under examination, the MD&A within the 10-Ks averaged 23.21 pages (SD = 17.32).

The researcher viewed the discourse contained within the 10-Ks as accounts—narratives that help explain the motives behind decision making (Scott & Lyman, 1968). Such public accounts are generally used for maintaining a person or entity’s positive image (Waring, 2007). Prior research in journalism studies has explained how accounts are used by news media companies to establish journalistic legitimacy (Singer, 2007), to issue corrections (Kampf & Daskal, 2014) to memorialize the past (Kitch, 2002) or to repair tarnished perceptions (Borden, 2012). In other disciplines, scholars have viewed investor relations documents (including annual reports and 10-Ks) as accounts, or “linguistic devices used when an outcome, action, or decision is assessed by the stockholders of a company” (Sandell & Svensson, 2016, p. 9).

To analyze the data, the researcher began with an open reading of the texts (in this case, the MD&A of the 10-Ks) in efforts to better understand how newspaper companies use accounts to talk about the concept of value (Sandell & Svensson, 2016). In conducting an open reading of the 10-Ks, this study adapted three dimensions from Sandell and Svensson’s (2016) typology of accounts in the context of investor relations. First, the author captured when corporate leaders used accounts to explain that failure had external causes, for which the firm may or may not take responsibility. Second, the author captured when corporate leaders used accounts to highlight the firm’s in-house problems—addressing that past failure has internal causes, for which the firm is taking active measures to correct. Finally, this study captured when corporate leaders used accounts to refocus attention—shifting discussion toward future opportunities for financial gain rather than focusing on past failure(s). This methodological approach aligns with van Dijk’s (1998) use of discourse analysis to illustrate in-group and out-group dynamics in journalistic practice. In the context of communications research, van Dijk (1998, p. 33) proposed that discourse analysis can be a useful methodological tool to assess narratives that “emphasize our good properties/actions, emphasize their bad properties/actions, mitigate our bad properties/actions and mitigate their good properties/actions.” Beyond examining the lexical facets employed, van Dijk (1998, p. 33) stated that such discourse can be viewed through the broader lens of “impression management,” an approach that considers how authors use texts to explain their own conduct, as well as the conduct of their competitors. Driven by a discourse analysis of accounts, this study helps shed light on conceptualizations of value by a sample of public newspapers in America.

Balancing Risks and Rewards

Large-scale, publicly traded companies (including most newspaper chains) are required to identify external forces, or “risk factors,” (contained in Part I, Item 1A of the 10-K filing) that may impair the firm’s profitability, or the ability to create new value. Across all years examined, six of the seven newspaper companies encompassed in this study provided voluminous detail on the multitude of pressure points within their operations that may ultimately stifle value creation. (The McClatchy Company, exempted from this SEC requirement by its smaller company size, did not formally report on “risk factors” in its 2018 10-K). Most prominently, all firms reporting “risk factors” indicated that technological change in the newspaper industry—even in the late 2010s—continued to interplay with their ability to make a profit. Beyond digital disruption, the six publicly traded newspaper companies identified additional perceived roadblocks toward creating value, such as the volatile cost of newsprint, as well as unpredictable, environmental hazards (a cyber attack or data breach, for instance) that may hamper their profitability. Multiple companies identified that maintaining their brand reputation in the era of eroding media credibility has emerged as a “risk factor.” The companies also articulated fears that new ways of reaching news consumers in the today’s fragmented media market may simply fail to gain traction.

In addition to enumerating the limits of profitability, companies must also explain how they are mitigating these risks. Within Part I, Item 1 (“business” section) of the 10-Ks examined, the companies extensively document in narrative their steadfast stewardship of shareholder investments—including how they are addressing the notion of risk. In response to the business model crisis for newspapers, each company included in this study’s sample vowed that their management team was internally spearheading efforts to diversify revenues, so that newsprint is no longer the sole vehicle for driving profit. In its 2018 10-K, The New York Times, for example, highlighted its expansion into new platforms beyond newsprint, such as podcasting, as well as its new television show, “The Weekly,” which has aired on FX and Hulu (2018). To incubate solutions for creating new value, several companies had also developed spin-offs and/or subsidiaries to directly handle innovation. New Media Investment Group Inc. (2018, p. 1), for instance, touted in its 2018 10-K its investment in GateHouse Live—the company’s “events and promotions business.” Other firms acquired startups as complements to the core business. In their 2018 10-Ks, both Belo and Gannett reported acquiring and/or securing voting interests in marketing solutions companies specializing in search engine optimization and software-as-a-service, for example (2018). All firms reported significant spending on research and development efforts to build their technological infrastructure. Beyond these strategies at managing and mitigating risk through first-mover opportunities, the newspaper companies in this study have sought in their 10-Ks to also convey how investors should conceive of their company’s value.

(Re)Defining Value

Within the MD&A of the 10-K, publicly traded companies generally provide a “business strategy” section, in which they detail an overall vision for their firm and its future. Across the period of the study’s content capture (2015–2018), five of the seven newspaper companies included in this study’s sample expanded content (generally encompassing several paragraphs of text) dedicated to journalistic mission in this “business strategy” section. (The McClatchy Company, it should be noted, has included an extensive, separate “Maintaining Our Commitment to Public Service Journalism” section in its 10-K filings during the study’s content capture period. New Media Investment Group did not visibly make significant language alterations related to journalism impact in its “business strategy” section during 2015–2018).

In 2015, Belo conveyed its value to shareholders in sheer economic terms. The company reported that “A.H. Belo is committed to producing positive net income and cash flow and creating value for shareholders over the long-term through stock price appreciation and dividends” (p. 8). By 2018, Belo’s team had revised this section of its 10-K, placing greater visibility upon the company’s newsgathering operations. The company’s 2018 10-K states that:

A. H. Belo is committed to producing quality journalism and providing innovative marketing solutions for its customers, as well as creating value for shareholders over the long-term through stock price appreciation and dividends. (2018, p. 7)

In the period under examination, Gannett’s 10-K filings similarly placed greater visibility upon the company’s journalistic mission. In 2015, its 10-K states that:

We [Gannett] are committed to a business strategy that drives returns for shareholders, delights audiences through a robust user experience and engages with consumers to strengthen the brands of advertising partners and drive revenue. (p. 4)

By 2018, this section had been restructured, with mentions of shareholders eliminated from the opening of its strategy section. The document indicates:

Gannett’s vision is to become essential to consumers and marketers seeking meaningful connections with their communities across print, digital and other channels. We are committed to a business strategy that drives audience growth and engagement by delivering deeper content experiences to our audience while offering the products and marketing expertise our advertisers desire. (2018, p. 8)

In its 2015 10-K, the New York Times Company identified that its strategy is founded upon “strengthening The New York Times brand through innovation” (22). This firm further championed its newsgathering operations and profitability in 2018, when the company stated its strategy revolved around “providing journalism worth paying for” (p. 27). The 2018 10-K filing states that:

We believe that The Times’s original and high-quality content and journalistic excellence set us apart from other news organizations, and that our readers are willing to pay for trustworthy, insightful and differentiated content. (The New York Times Company, 2018, p. 27)

Lee Enterprises added a new strategy section to its 2018 10-K, illustrating the centrality of newsgathering to its mission. As stated in the company’s 2018 10-K:

We drive frequency and engagement with our products by delivering valuable, intensely local, original news and information that we believe in many cases our audiences cannot otherwise readily obtain. (Lee Enterprises, Inc., 2018, p. 3)

Between 2015 and 2018, public newspaper companies also increasingly emphasized in the 10-Ks the public good that comes from their newsgathering operations. Companies referenced industry awards won by journalists at their newsprint properties—particularly prestigious Pulitzer Prizes. Extending this discussion, The New York Times Company 10-K states that:

We continue to focus on expanding our audience reach and strengthening the engagement of users by making The Times an indispensable part of their daily lives. And we continue to communicate the value of independent, high-quality journalism and why it matters. (The New York Times Company, 2018, p. 27)

Conclusion

In the late 2010s, numerous American public newspaper companies (as witnessed across 4 years of their 10-K SEC filings) expanded how they define value. Beyond economic concepts of value, the firms are also accentuating how their newsgathering operations also lend value to the communities they serve. Borrowing from visions of how journalists have historically assessed value (Powers, 2018), corporate newspapers are advocating in their 10-Ks that the journalistic mission itself also provides worth. Value, in this context, can be derived from producing information that benefits citizens in democratic life. This heightened prominence of journalistic mission in the 10-Ks may be traced to seismic shifts in the underlying business model for news—most notably the entry of philanthropic foundations and crowdsourced contributors who often measure value as impact (Benson, 2018). More research is needed, however, to identify how and to what extent these new financial players (particularly nonprofit funders) are altering how corporate newspapers conceive of their own value.

At the same time, these documents contextualize how public newspaper companies carefully weigh potential innovation against inherent risk. The 10-K filings detail a litany of perceived risks that may, in isolation or in concert, act to inhibit potential future success. Aligning with prior research on investor relations communication (Sandell & Svensson, 2016), the 10-Ks act as “accounts” that identify external causes for failure, while also explaining internal measures taken to address these shortcomings. Given the newspaper industry’s financial pressures at hand, company executives must strategically and cautiously weigh the ability to pivot toward new forms of value creation as first-movers against the associated risks involved. The newspaper industry has been historically risk-averse, however (Sylvie, 2018). But if corporate executives can surmount these institutional hurdles, the innovations produced may promote long-term loyalty to news brands, thereby stimulating the company’s profitability (Huang & Sylvie, 2010).

To this end, newspapers are pursuing first-mover opportunities that fit with their “business strategy” or mission/vision (Tetrault Sirsly & Lamertz, 2008). The documents also demonstrate that companies are experimenting with a limited set of new initiatives, in efforts to gain a head start over their rivals. The small subset of innovations identified in the 10-Ks may reflect the increasingly entrepreneurial culture of today’s newsrooms, populated with journalists eager to experiment with ways to (re)capture readers (Vos & Singer, 2016). Taken together, this study further establishes that corporate newspapers are expanding ideas of generating value from their day-to-day operations, in hopes of bolstering their bottom lines.

Following from this study, future research is needed on how the institutional priorities for value creation are subsequently communicated and implemented in the newsroom. In particular, a blind spot in the literature exists regarding strategic planning and resource allocation by senior managers within news organizations, and how these executives interface with editors and reporters around institutional innovation. This scholarship (likely, ethnographic in nature) can address a shortcoming of this study, which relied upon the self-reported narratives of the companies studied. These documents most likely diminish perhaps the most understudied issue in journalistic culture: failure (Belair-Gagnon et al., in press). To preserve competitive advantage in the marketplace, it is also possible that these companies limit detailed description of first-mover opportunities within their 10-Ks. In-depth interviews with news company leaders could potentially probe the reasoning behind constructing the 10-Ks as public-facing “accounts.” At the same time, this study is also limited by its focus upon public newspapers, which are required to transparently report filings with the SEC. This study cannot be generalized to the newspaper industry at large, as private companies may carry divergent approaches to risk and return (Soloski, 2019). Delving into these companies would prove difficult, however, as they are not mandated to discuss or disclose their investments publicly. Broadly speaking, more research is needed on the business side of newspaper operations altogether. This study provides an initial entry point into this discussion.

Despite industry disruption, public newspaper companies largely portray a slow and steady approach toward potential innovation. Incrementally though, this study advances that newspaper executives are expanding how they see value within their organizations. As technological change continues to reshape journalistic practice in the 2020s, public newspapers will continue to evolve in how they define and create value for economic stakeholders.

Footnotes

ORCID iD

Jan Lauren Boyles

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