Alaska’s digital startup takes over the daily

Promise, and potential pitfalls, as Alaska Dispatch and the Anchorage Daily News merge

One of the more fascinating local media experiments in America is playing out in Anchorage, AK, where, last week, the sale of the Anchorage Daily News was finalized. ADN, owned by McClatchy since 1979, was bought for $34 million by Alice Rogoff, a veteran media executive and wife of the billionaire David Rubinstein, who already holds a majority stake in the online-only news site Alaska Dispatch. The newsrooms have already merged, under the leadership of Dispatch editor Tony Hopfinger; soon, the websites will merge, too. The two outlets, once rivals, are now one.

The obvious question: Why?

“Simply to be able to gather up enough advertising and customer support resources to do far more journalism than the two of us separately have been able to do, on issues that Alaskans care about,” Rogoff told CJR.

Elsewhere, the sale has been framed as a case of a still-young digital outlet taking over the legacy print dinosaur (“Salmon swallows whale”: the Seattle Post-Intelligencer), or as another example of the trend of billionaires buying up newspapers at bargain rates (“Business moguls continue to shake up the world of newspapers, this time to the far north”: The New York Times.)

The Anchorage Press, a local alt-weekly, was more cynical, writing of the digital-native Dispatch’s move to print: “If you can’t beat ‘em, buy ‘em.”

The reality is somewhere in between. The deal would have been impossible without the deep pockets of Rogoff, an East Coast native who has long taken an interest in all things Alaska, and it allows the Dispatch team to take advantage of ADN’s established operations and perhaps gain some leverage with advertisers, rather than grinding away to compete with the paper. But it also wouldn’t have been feasible if the Dispatch, founded in 2008, hadn’t established itself as a credible source of state news and watchdog journalism.

And the deal does create an exciting opportunity for Alaska media—though not one without risks. If the leaders of the new operation can find a sustainable business model, manage the merger of two newsrooms in an insular media market, and sustain a high level of editorial energy even with one less competitor out there, the state could be better served then ever. But if they stumble, Alaska’s news consumers could be worse off than before.

The announcement of the deal came as a shock to most ADN staff, who weren’t aware that their newspaper was even up for sale. That’s because it wasn’t, until Rogoff made McClatchy an offer it couldn’t refuse: $34 million for a paper with a weekday circulation of just over 40,000, plus the building in which it’s housed (which Rogoff intends to sell, offsetting some of the cost). Compare that to The Boston Globe, which was purchased by Red Sox owner John Henry for twice that amount but has six times the circulation—not to mention the building and the Worchester Telegram & Gazette, both of which Henry intends to sell.

With Rogoff’s purchase comes turnover at the top. Pat Doyle, ADN’s publisher and president, has retired, as has the paper’s editor, Pat Dougherty. Rogoff is now the publisher, and Hopfinger, the Dispatch’s co-founder and executive editorand a former ADN reporterhas taken over for Dougherty, running the merged newsroom. (Managing editor David Hulen is staying on, though the top of the new newsroom’s masthead is otherwise dominated by Dispatch people.)

By the time they spoke to CJR, a few weeks after the announcement but before the deal closed, several ADN reporters were still understandably nervous about the changes. They were also hopeful about the future—especially those who were at the paper during McClatchy’s deep cuts to the budget and staff in the late 2000s (as documented by the Dispatch). Over the last year, ADN seemed to be coming back from those losses, hiring several reporters and adding sections. But having an owner willing to invest real money into the paper is surely welcome.

“I’m going into this with an open mind, I want it to work. I love the newspaper. And we put so much of ourselves into it,” said Lisa Demer, who has been at ADN 20 years as of this month.

“Long-term, I think Alice owning the newspaper is probably a good thing,” said Kyle Hopkins, a 10-year ADN vet.

While she has deep resources, Rogoff doesn’t intend to prop up the news organization as a philanthropic gesture. “This has to make money,” she said. Detailed figures are not available for either outlet, but the for-profit Dispatch operated at a loss—the result, Hopfinger says, of re-investing its revenue to build up its still-nascent newsroom. ADN, on the other hand, was profitable—and was making, Hopfinger says, more than the Dispatch was losing. “There’s a lot of profitability to work with,” he said.

And with a private owner who isn’t accountable to shareholders, isn’t trying to maximize profit margins, and isn’t saddled with millions of dollars of debt from the exceedingly ill-timed purchase of Knight Ridder, the new organization will, the theory goes, be able to spend more on its journalism. Those plans are reflected in the combined staff list, where 10 of the 20 reporter positions have Dispatch email addresses, while non-newsroom staff are overwhelmingly from the ADN side. And reporting manpower can be especially important in a state that’s twice the size of Texas, with parts only accessible by airplane. ADN had scaled back its coverage and become more Anchorage-focused as part of McClatchy’s cuts. No longer. Not only will reporters have the money to do more traveling for their stories; it’s also something Rogoff—a trained pilot whose occasional reporting forays by Cessna seem to get a mention in every Dispatch profile—encourages.

“If you don’t go out looking for these stories, you won’t find them sitting in Anchorage on the receiving end,” Rogoff said. “We need to just be doing a better job of asking the questions and collecting stuff from those areas. And there hasn’t been a real habit of doing that.”

Viewed more skeptically, ADN’s profits were possible only because of those earlier deep cuts—and bets that editorial investment in local news will pay off are no sure thing. “I think, at least short-term, it’s good for journalism in Alaska because [Rogoff] is going to spend a lot of money,” said Anchorage Press publisher Nick Coltman, who has decades of experience in the Anchorage media world, including as publisher to Hopfinger’s editor about 10 years ago. He’s just not sold on whether it will be sustainable: “At some point, you have to focus on the business end of it.”

Profitability aside, there’s the question of personality. Several people on the ADN and Dispatch staffs have worked at both outlets. Some moved from one to the other under pleasant circumstances. Some didn’t. Hopfinger began the Dispatch because he wanted Alaskans to have an alternative to ADN and the Press. He left ADN over a decade ago because didn’t feel that his editors supported some of the reporting he was doing. Now he is ADN.

Hopfinger conceded that “there may be people that find that they’re not up for this next chapter,” but added, “no layoffs are planned.” (This has been true in terms of full-time staff, though two reporters who worked at ADN on a temporary basis—and who once worked for Hopfinger—were no longer with the company on the Monday it merged with the Dispatch. Hopfinger did not respond to an email asking for the circumstances behind their departures. ) Additionally, one of the Dispatch’s co-founders is now a columnist for ADN. She’s also Hopfinger’s ex-wife.

For any ADN or Dispatch journalists who don’t, for whatever reason, stay on, there are a few other outlets, even in a relatively small market. “I’ll probably get some staff options from the Daily News,” Coltman predicted.

For others, the merger may be a nice reunion. Hopkins, the 10-year ADN vet, also worked for Hopfinger at the Press in 2003, in his first job in Anchorage. He said of his year at the Press: “Tony, who was younger than I am now, helped me make the switch to writing long, narrative stories. I’ve used those techniques—thinking about stories in terms of scenes and characters—ever since.”

Then there are the journalists, who, like Hopfinger, moved from ADN to the Dispatch, and are moving back again. Craig Medred was at ADN for decades before taking a buyout in 2009 and heading to the Dispatch. He’s a big fan of how Hopfinger ran the Dispatch’s newsroom (“a wild and crazy place” that reminded him of earlier times at ADN), and admits he has “very mixed feelings” about going back.

“All of the sudden our operation is going to become bigger and thus involve some bureaucracy,” Medred said. “Those things concern me. We’ve been light, mobile, and fast, and now we’ve kind of got armor we have to deal with.”

At the moment, the two editorial products are still distinct, so for readers, the most noticeable changes are still to come. is the most-read Alaskan news website, according to Alexa’s analytics. It will soon re-direct to McClatchy’s platform was proprietary, so rather than build a new site, all ADN content will migrate to Dispatch’s platform. Hopfinger hopes to finish the process by early July.

The future of ADN’s paywall, introduced in December 2012, is uncertain. Hopfinger says he’s not a fan of paywalls—in a local market, he thinks, they cost more in advertising revenue than you make back in subscriptions—but hasn’t made a decision yet.

And, if Hopfinger has his way, readers will see a lot more local news and a lot less national and international news. Twice the reporting staff means twice the articles, and print space comes at a premium. Why waste it on AP copy, both Hopfinger and Rogoff said, that’s already out of date by the time it hits customers’ doorsteps?

It remains to be seen if Hopfinger will be able to get out of ADN’s contract with The Associated Press, however. He has to give two years’ notice, at the cost, he says, of $175,000 a year. He’d rather not.

“We’re going to fight that,” Hopfinger said. “If it needs to be a legal fight, it’ll be a legal fight. But I think it’s ridiculous the amount of money The Associated Press charges … this is not part of our business plan and the way that I want to operate the news operation.” When it needed a wire service to fill in coverage gaps, Dispatch turned to the Christian Science Monitor. (“We have appreciated the Anchorage Daily News’ membership and will work with the new owners to help them make the best use of AP content,” AP spokesman Paul Colford said in an email.)

For that matter, what about the future of ADN in print? Already, some Alaskans can only get their ADN online—as it became too cost-prohibitive to ship the newspaper to some areas of the state, ADN scaled its distribution back. But about half the state’s population lives in Anchorage, so there’s still a big customer base that likes its paper.

While Hopfinger wouldn’t commit to anything, he said, “I wouldn’t imagine [print] would stop in, I would say, years. I don’t see that stopping … We’re not slashing the print product, that’s not what this is about.” That should be welcome news to ADN veterans like Demer, who said, “The print paper is super-important to this community today, right now.”

It seems more likely that the name of the paper will change before it stops printing. Hopfinger says he’s keeping an open mind on the title, but admits that he can see it being more reflective of a state-wide—rather than Anchorage-wide—focus.

Perhaps it’ll be something like … “Alaska Dispatch.” The name of a vast, expansive state, for a newsroom with big ambitions. There are plenty of potential pitfalls, but there’s a lot to look forward to—a great media story to watch, and a big opportunity to do great local journalism in a news market unlike any other.

“It’s hard not to be excited,” Medred said. “It’s really now what we do to take advantage of it.”

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Sara Morrison is a former assistant editor at CJR. Follow her on Twitter @saramorrison. Tags: , , , ,