Why Would Anyone Invest More In Gannett Now?

Brandes Investment Partners of San Diego last week filed with the SEC to say that it increased its stake in newspaper behemoth Gannett. This makes Brandes the company's biggest shareholder, at 11.25%.

And all most people -- including me, who worked for Gannett for 25 years -- can say is: "Huh? Why?"

The Internet is clobbering newspaper companies. Knight-Ridder collapsed. McClatchy's stock has been cut in half in a year. Gannett trades at less than half its 2004 stock price.

No newspaper company has shown any exceptional wisdom about how to remake themselves for the 21st century, Gannett included. The company has tried some interesting ideas around the edges, but there is no great vision coming from CEO Craig Dubow, no transformation on the horizon. Watching Gannett these days is like watching your grandfather age and starting to realize his health isn't going to go in a positive direction.

One comment on Gannett Blog (not affiliated with Gannett) makes an interesting point. My colleague Felix Salmon speculated recently that Google would be a good owner and preserver of newspapers. But there's another idea floating around: that newspapers are more like sports teams. No one owns a sports team -- whether the New York Yankees or the Durham Bulls -- to make money. Sports teams are a vanity purchase. They give a person stature in the community and, in a sense, a rich-person's hobby. Newspapers are about the only other type of entity in the same category.

So let local tycoons buy local papers and run them as their fiefdoms. The era of corporate newspaper ownership may be done for.

Which still doesn't tell us why Brandes would up its investment in Gannett -- unless it envisions selling the properties piece by piece.

Sadly...this brief video says too much...

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