It’s going to take time to sort out all of the implications of Gannett’s announcement this morning that it is spinning off its newspaper division, which is comprised of 81 daily newspapers, including The Des Moines Register and USA Today.
But here’s one likely scenario: a bust-up of the newly created print-only division by selling off the properties, including the Register, to buyers in their home communities.
The parent company, which has yet to be named, said it plans to retain Gannett’s broadcast and digital properties.
That is a crushing blow to the print operations, because it means that the digital properties, which are the only significantly profitable vestiges of what was once known as classified advertising, will no longer be available to the community newspapers.
The Gannett announcement said that CareerBuilder and Cars.com will be housed on the TV side of the split, removing them as profit centers from the print operations.
That shift, will make it even more difficult for the print operations, which are already suffering from losses of advertising and circulation revenue in recent years, to be profitable.
Without the digital properties, the future of print-only operations become much darker.
The most likely scenario for maximizing shareholder value on the print side will be to sell the newspapers. And since no investor in his or her right mind would buy all 81 Gannett newspapers, the best option becomes selling the newspapers to possible buyers in each of their home communities.
That’s what’s happened with newspapers in other bid chains that were forced out of business.