Stop the presses

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July 31, 2006

Here are the developments following my “monopolies are forever” blog of last Friday:

1. Today, Monday, July 31, The Department of Justice decided, “to close its investigation” into the Singleton/Hearst monopoly deal. It said, in a terse two-page press release, “the Antitrust Division determined that the transaction is not likely to reduce competition substantially.” How in the world could the DOJ—even the DOJ of Bush and Gonzales— make such a finding on a transaction that in effect destroys daily competition in the Bay Area and establishes a Denver billionaire as the Baron on the Crag for the duration? It is obvious to anyone who knows anything about the history of local journalism just how bad this deal will be for the public, readers, advertisers, and the free press provision of the First Amendment.

2. Hearst has in effect thrown in the towel and says it doesn’t want to compete with Singleton—by announcing it is facilitating the deal by investing undisclosed millions of dollars in Singleton properties outside the Bay Area. Singleton is widely known as hating competition and doing everything he can to eliminate or coopt it. Justice did not even address this crucial point but did state: “The division’s investigation did not address the effects of potential future transactions involving MediaNews (Singleton) and Hearst. The Division is aware that Hearst has announced plans to invest in MediaNews—ostensibly limited to its non-California newspapers—and may be considering other collaborative arrangements with MediaNews involving San Francisco area newspapers. If and when any such arrangements is proposed, the Division will investigate whether it would adversely affect competition.” This crucial statement, wimpy as it is, was omitted from the Hearst coverage in its minimalist story on SF Gate on Monday—and omitted from the Contra Costa Times story.

3. The DOJ said that it did a “careful investigation” and interviewed more than 80 people, “including newspaper advertisers, subscribers, labor leaders, and industry experts.” Guess what? They didn’t interview anybody from the Bay Guardian or anybody from any other competitive papers to my knowledge. If anybody was interviewed, or knows of anybody who was interviewed, please let me know.

4. As you will remember, I sent my story of last Friday and a batch of obvious unanswered questions to the Hearst executives and staff, asking for answers or a statement or asking that they be answered in subsequent stories. They weren’t. Saturday’s Chronicle story, reporting that a federal judge denied a temporary restraining order in the Clint Reilly antitrust case, was again buried, this time on page 3 in the Bay Area section. There was nothing in the Sunday Chronicle. And, on Monday, when DOJ made its announcement, the story on SF Gate was again minimalist and didn’t even get in the key public interest points from the DOJ statement.

5. To make my point crystal clear: the Chronicle didn’t even report the critical point: were Reilly and his attorney Joe Alioto going to continue on with the case? Or was it all over, as their coverage tried to show. Reilly and Alioto plan to continue on with their case, as Alioto told us this afternoon.

6. Meanwhile, the Guardian has demanded that Justice, since it has closed its investigation, open its investigative files to the Guardian and the public. We are asking the publishers, who often bellow loudly for government to release documents, to support this proposal publicly. Alioto says he, too, has asked for the files and that he plans to start a website and perform the ultimate journalistic and public service: make everything public that he comes up with through the suit as quickly as possible. The Guardian will do so as well on this site at sfbg.com. Stay tuned. B3