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Friday, April 22, 2005

US: billionaire investor Philip Anschutz shows interest in newspapers

In an article through Business Week, the innovative investor Philip F. Anschutz appears as a very important figure to watch in the media industry. Now worth an estimated $5 billion, Anschutz invests in high-profile businesses such as movies, sports teams, and daily newspapers. Anschutz typically searches for out-of favor assets and finds a way to build them into profit earning enterprises. For now, newspapers seem to compose one of his biggest investment interests. Given his unquestionable success in the past, his strategy of rebuilding struggling business may yield profitable results for the newspaper industry.

Specifically, Anschutz bought the revenue-losing San Francisco Examiner for $20 million in 2004. In the same year he also bought Journal Newspapers Inc., the publisher of three struggling dailies in suburban Washington D.C. Anschutz then re-launched the papers as free dailies, each under the Examiner masterhead. The papers now form the core of a new Denver based company called Clarity Media group. Thinking ahead, Clarity has already trade marked the Examiner name in at least 60 cities.

Through issues of the Examiner, Clarity hopes to defeat rivaling newspapers by targeting the readers most desired by advertisers: young, educated homeowners in affluent areas. Since its founding, Clarity has since doubled it daily print run. Yet the question of whether Anschutz will generate enough ad revenue to cover the publishing and distribution costs still remains. Clarity will not release the amount they intend on spending before they expect to see a profit. Accordingly, veteran newspaper analyst John Morton says "No effort to establish a new daily newspaper in a U.S. city has worked [in decades]. "

Though history shows a poor track record of newspaper startups, similar strategies practiced by Anschutz to buy and rebuild struggling business have proven very successful. The Anschutz Entertainment Group, which started when Anschutz and a partner bought a Californian hockey team in bankruptcy, is now the nation?s second-largest promoter of live events after Clear Channel Communications.

Many tarnished businesses lucky enough to have received Anschutz?s touch seem to have turned to gold. Hence, his potential impact within the newspaper industry is certainly something to watch in the coming years.

Source: Business Week

Posted by Andrea Steinberg on April 22, 2005 at 06:54 PM | Permalink

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Comments

Anschutz ill .. I would do the same if I had the money

Posted by: Nora at Jun 7, 2005 10:30:22 PM